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What Does the Sizmek Deal Mean for Your Amazon Ad Strategy?

How does Amazon's acquisition of ad tech company Sizmek's ad server and creative platform help it in the digital ad race against Google and Facebook? By IT June 28, 2019
What Does the Sizmek Deal Mean for Your Amazon Ad Strategy?
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At the end of May, Amazon signed a deal to acquire the Sizmek ad server and Sizmek’s Dynamic Creative Optimization (DCO) platform after Sizmek filed for bankruptcy earlier this year. The acquisition has since become official and, according to Amazon and Sizmek, both Sizmek properties will continue to operate separately from Amazon Advertising for the time being.

Sizmek is an ad tech company that provides integrated solutions to clients across the entire customer journey, with a specific focus on five key dimensions of predictive marketing — campaigns, consumers, context, creative, and cost. The platform operates in over 70 countries and boasts over 20,000 advertisers and 3,600 agency clients. 

Amazon’s announcement of the acquisition mentions that Sizmek and Amazon Advertising have a significant amount of mutual customers and that both parties are dedicated to serving their customers with excellent service.

Although Feedvisor research indicates that more consumers start their search for new products on Amazon over search engines, and are more likely to go to Amazon over a search engine when looking for a specific product, Google is still heavily outpacing Amazon in the digital advertising space. 

However, this deal will enable Amazon to gain ground against the storied duopoly of Google and Facebook — eMarketer predicts that for the first time the two leaders’ combined share of the U.S. digital ad market will drop this year.

Sizmek’s ad server, which can place advertisements across the web, and DCO, which allows ad personalization through data, give Amazon more tools to leverage as they continue to scale, innovate, and improve their advertising offering with both manual and automated improvements. 

The dynamic creative platform opens the door to potential behavioral or geo-targeted advertisements, which could be a unique competitive differentiator for Amazon. The company can use its consumer information to attract advertisers to its platform to create customized versions of each ad placement based on user wants and needs. Amazon would also be able to use the tool to track if an advertiser’s product was purchased after a consumer saw an ad for it, a reporting tool that advertisers will want in order to accurately track transactional ROI.

With its own ad server, Amazon is strategically building out its ad stack and enhancing overall product stickiness and adoption. With an ad server at the center of its offering, Amazon will make it easier for its advertisers to use other elements of the ad stack — and may even result in incremental advertisers moving their ad budgets over from Google to Amazon.

The deal may allow Amazon to work with advertisers who do not operate on Amazon and are interested in access to Amazon’s vast amount of data and consumer base. As adoption for Amazon’s advertising platform is still in its early days, this move represents the company’s commitment to growing as a digital advertising leader.

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