Seattle: A chain of physiotherapy clinics wanted new patients. They targeted people near their offices and nearby areas who had recently bought new kneecaps, knee braces or infrared lamps recently on Amazon.
A credit card company were in search of new customers to buy their credit card, they targeted people who recently had done shopping transactions using the card of other banks on the Amazon site.
A financial service provider was keen to promote its business that included retirement plans, they targeted people of the age group between 40 -50 who have recently bought a personal finance book from Amazon.
These advertisers mentioned above found their target audience through Amazon’s advertising services. This advertising service knows better, the consumer buying habits through its predictive analytics that includes a complicated algorithm. The predictive analytics of Amazon provides price optimization, personalized recommendations and anticipatory predictions on what customer will buy.
Co-founder of Quartile Digital, Daniel Knijnik claims that “Amazon has a straight forward database – they know what you buy”. It’s a dream of every advertiser to target the right audience.
The advertising services is a third major pillar among all the Amazon businesses including the eCommerce and cloud computing. The worth of Amazon’s advertising business is about $125 billion, more than the estimations of companies like Morgan Stanley, Nike or IBM. The advertising company is more focusing on selling display or video ads across the web and gaining a strong ground on the industry leaders - Facebook and Google.
Apart from knowing what people buy, Amazon also knows where people live, through their delivery addresses they provide while ordering a product, and which credit card they use. Amazon is also aware of the age of their kids, from baby registries and which customer is suffering from a cough, from the cough syrup recently ordered for two-hour delivery.
The company would also offer an option of self-service for brands and ad agencies where they can take advantage of its data on shoppers.
Most of the ad agency offers different ways to target the audience. A brand selling running shoes for men may turn to search for people who the company believes are men and interested in running or taking part in marathons based on their browsing history. The company may even turn to Facebook and look for people who are in the men’s running group.
The retail giant Amazon has many features that are similar to those of Facebook or Google, like targeting customer based on their search history, interests and demographics. But Amazon has a unique way of working by removing the guesswork and targeting people who have already bought running shoes on Amazon.com.
Amazon offers great flexibility to the advertisers by giving access to the self-service system where they can run their own targeting campaigns on Amazon websites or other websites on a range of investment levels. Users of the self-service system get the flexibility of choosing from hundreds of automated audience segments.
Amazon has also been developing different ways where the brands can target their own customers. Advertisers get the flexibility to upload their own customer lists. Here Amazon will match with its database and then show ads to those customers.
Based on the shopping behavior Amazon shows different ads to different people. People who have done a lot of research on a particular product may see an ad that featured positive product reviews. Also, people who have just added the product to cart on the previous night have the chances of receiving the product on a more discounted rate.