Advertisers who purchased spots on Amazon.com Inc.'s NFL telecasts are sizing up the platform's potential, and determining how best to exploit it.
It is an important test for Amazon as it ventures into live sports and tries to become a digital advertising powerhouse.
For some, the appeal is Amazon's promise of "attribution," the idea that the company can show that ads led to an increase in brand awareness or online store sales, including on Amazon.com. Marketers crave that data and have gotten uneven results in television.
For others, the draw is an affluent audience—National Football League games can only be viewed by subscribers to Amazon's $99-a-year Prime service.
"It's an opportunity to partner with Amazon and to understand, over the course of the season, Amazon consumers, NFL content and how they may or may not interact within Amazon's core platform of e-commerce," said Tom McGovern, president of Optimum Sports, a sports media and marketing agency owned by ad giant Omnicom.
Sling TV, which sells an online package of cable-TV channels and sees potential overlap with Amazon's streaming audience, was among the advertisers that bought an Amazon NFL ad package. Other advertisers include Showtime, Gillette, Pepsi and Hyundai.
"Part of the incentive is that these Amazon Prime users are affluent; they're folks that purchase things online, and we think and we're pretty sure that they're also more likely to watch streaming," said Warren Schlichting, executive vice president of marketing, programming and media sales at Sling TV and parent company Dish.
Amazon sought $2.8 million for a package that included inventory in each of its Thursday night games, as well as other ad inventory across Amazon's platform. There were skeptics among advertisers and not everyone went all in: Some advertisers paid around $1 million less than the original asking price, according to people familiar with the deals.
The online retail giant generated $1.1 billion in U.S. digital ad revenue in 2016, a small sum compared with Google's $29.4 billion and Facebook Inc.'s $12.4 billion, according to eMarketer. But the e-commerce giant is viewed on Madison Avenue as an emerging rival to the socalled duopoly, due to its powerful data and deep pockets.
"We're very happy with advertiser response and are sold out," said an Amazon spokeswoman in a statement regarding its NFL streaming effort.
Amazon paid $50 million for the rights to stream 10 Thursday night NFL games, alongside CBS and NBC, which are splitting the season schedule. Amazon has access to 22 spots per game, including pre-, post- and in-game ads—inventory that on traditional TV goes to local broadcast stations.
Some ad buyers were skeptical about Amazon's ability to attract a big NFL audience, describing the buy as an "experiment."
After its first game on Sept. 28, Amazon said that the average world-wide audience watching Thursday Night Football on Prime for at least 30 seconds was 372,000. In the second game Amazon aired, the average audience grew to 391,000. By comparison, CBS and NFL Network's television coverage of the two games averaged about 15 million viewers, according to figures from CBS.
Some advertisers rebuffed Amazon's ad packages, largely due to the requirement to buy non-NFL Amazon ad inventory such as display and video ads on Fire TV, Amazon.com and Amazon Prime's TV shows.
In some cases, media buyers that didn't have clients that sell products on Amazon were also uninterested, because the Amazon data and research promised as part of the ad deal would be less valuable to them.
An Amazon spokeswoman said, "We don't share pricing or package details as a matter of policy—but can tell you that we offered a range of options at various price points depending on advertiser objectives, which may include additional Amazon media placements."
BY ALEXANDRA BRUELL