Amazon Prime Video advertising to increase further from 2025

Kelly Day, Amazon Prime Video's vice president for international markets, revealed in an interview with the Financial Times that the company plans to offer more ad space to advertisers from 2025.

Amazon to increase number of advertisements on Prime Video
https://www.ft.com/content/f8112991-820c-4e09-bcf4-23b5e0f190a5

Amazon will “ramp up” Prime Video ads in 2025
https://arstechnica.com/gadgets/2024/10/amazon-prime-video-is-getting-more-ads-next-year/

Starting in January 2024, Amazon Prime Video will begin showing advertisements in regions such as the United States, Canada, and the United Kingdom .

Advertisements start being distributed on Amazon Prime Video, what is the length of the ads and Amazon's revenue prospects? - GIGAZINE

When the ads were added, The Wall Street Journal found that the change meant that Amazon Prime Video users were spending an average of two to three and a half minutes watching ads per hour, but the introduction of ads did not result in the dramatic drop in subscriber numbers that Amazon Prime Video executives had feared.

Regarding the automatic switch to an ad-free plan if customers didn't pay extra, Day, the Amazon Prime Video vice president, told the Financial Times, 'We know it was a bit of a contrarian approach, but it worked out better than we expected. We've seen much lower cancellations than we expected, and we haven't seen any signs of a surge in dropouts or cancellations.'

Day declined to say how many people have paid the extra fee to subscribe to the ad-free plan, but said it's less than the 20% that some analysts have estimated.

Amazon is seeing positive results from adding more ad inventory as users are tolerating the ads, and Day said, 'You're going to see a bit more advertising load going into 2025.'

Day also confirmed that 'shoppable ads' will be added to Amazon Prime Video from 2025. Shoppable ads include ads that display product ads during pauses in videos and allow users to take actions such as 'add to cart,' as well as brand PR ads that play during video playback and allow users to purchase from there.

Amazon Prime Video will soon start showing ads for Amazon products during pause - GIGAZINE

Advertising is a profitable area for Amazon, with digital advertising revenues increasing 20% year-on-year to $12.8 billion in the second quarter of 2024. Although advertising costs are reportedly lower than those of its competitor Netflix, Amazon's ability to quickly force the majority of its subscribers into ad-supported plans gives it an advantage in appealing to advertisers.

Ars Technica, an IT news site that covered this issue, commented, 'As long as users continue to pay for advertising subscriptions, streaming services will continue to explore how much advertising revenue they can get from viewers. If Amazon increases the amount of advertising it places in 2025, the movement to test how much advertising users can tolerate will become even more intense.'