Home Commerce Amazon Is The Latest Major Ad Platform Going All-In On Machine Learning Tech

Amazon Is The Latest Major Ad Platform Going All-In On Machine Learning Tech

SHARE:
Comic: A.I. Ad Campaign

The new hot trend in platform advertising is to put the machines in charge of everything.

It’s true of Google, true of Meta and, even more so as of this week, it’s true of Amazon.

On Thursday, the Amazon DSP rolled out a system-wide upgrade to its machine-learning and predictive algorithms, Neal Richter, the group’s director of data science engineering, told AdExchanger.

Richter said the upgrades include new capabilities with data fed by large language models (Mmmm … that’s some yummy jargon), which are in turn built on prior machine learning-based tech developed for the Amazon ad business. These models were already in use to expand online advertising addressability, but will now also support predictive analytics and campaign planning.

The upgrades were in development for a year and a half, and this is the first major overhaul of Amazon’s predictive algorithm in that time.

But the new machine learning ad products are not Amazon’s answer to Performance Max, Google’s black box AI buying tools, or Meta Advantage+ Shopping Campaigns.

Other walled garden platforms with machine learning-based ad products “withdraw control and transparency” for the advertiser, Richter said.

Amazon’s machine learning upgrade will now be a core function of the DSP for all advertisers, which means the product enhancements will not pull back on campaign transparency or analytics reporting.

The ability to bake predictive conversion analytics into its machine learning algorithm is a big advantage for Amazon. Google’s PMax and Meta’s Advantage+, which Richter is nodding at without naming, are both attempting the same trick, which is to connect ad impressions to sales. But those products include drastic reductions to campaign controls. Advertisers, for example, don’t choose their media, bid prices or creative, and also have no transparent attribution. This is because Google and Meta must preserve their own first-party data while combining it with someone else’s purchase data.

The Amazon DSP isn’t combining purchase data with anyone. It’s simply Amazon.

Subscribe

AdExchanger Daily

Get our editors’ roundup delivered to your inbox every weekday.

“The backbone of our performance is how we measure ROAS and CPA, in real terms, on the store,” Richter said. “We have a direct connection with the cash register, so to speak.”

And don’t expect another 18-month wait before the Amazon DSP puts out its next piece of machine learning-related news.

More announcements will be coming this year, Richter said. “I think of this as just the starting gun.”

Must Read

Comic: Welcome Aboard

Google’s Ad Network Biz Dips, But Search Brings Home The Bacon

By next year, Google will have three separate business lines – Search, YouTube and Cloud – with an annual run rate to generate at least $100 billion, CEO Sundar Pichai told investors.

Comic: The Last Third-Party Cookie

Cookie-Related Quips To Get You Through Google’s THIRD Third-Party Cookie Delay

If you’re looking for a think piece about what Google’s most recent third-party cookie deprecation delay means for the online ad industry – this isn’t it. 😅

Comic: InstaTikSnapTokTube

The IAB Predicts Social Video Will Overtake CTV This Year

The IAB projects digital video ad spend will rise to $63 billion in 2024, representing a 16% increase from last year. Of the three video ad categories the report breaks out (social and online video and CTV), the clear winner is social video.

Privacy! Commerce! Connected TV! Read all about it. Subscribe to AdExchanger Newsletters
Pictograph of graph, mug of beer

Inside AB InBev’s Strategy For Tapping Into First-Party Data

Pour one out for third-party data. These days, AB InBev’s digital marketing strategy is built squarely on first-party data.

4A’s Measurement Committee Says New Currencies Aren’t Ready For Prime Time – Yet

The 4A’s measurement committee, a working group for marketers and media buyers to discuss their opinions and concerns about video ad measurement, has some thoughts on the status of alternative TV currencies.

How Chinese Sellers Are Quietly Reshaping US Consumer Habits

American consumers are buying more and more online products directly from Chinese manufacturers. It’s an important change, though many online shoppers are unaware.