It aims to make video pay by applying the techniques of e-commerce
around a high-speed train carrying a former Miss World and a gang of spies through the Italian Alps, shopping is surely the last thing on viewers’ minds. Yet should they press pause, they will see an option to buy items from the show: the heroine’s gold necklace, her red dress, or the teetering stilettos in which she is improbably running rings around the villains. Only her exploding perfume is not yet for sale.
old hands are snooty about Amazon’s video efforts, and understandably so. Despite a reported budget of $300m, making it the second-priciestseries in history , “Citadel” received lukewarm reviews and failed to crack the top ten most-streamed shows in America . Critics see it as emblematic of the company’s high-spending, low-impact record in video. This year Amazon will blow $12bn on streaming content, second only to Netflix . It has had some hits, including “Reacher” and “The Boys”.
The most obvious motive for Amazon’s video experiments is to increase the value of the Prime bundle, which keeps members shopping on the e-commerce site. But video has the potential to become a moneyspinner in its own right, in two ways. Among streamers, Amazon is uniquely well placed in the advertising game. Whereas Netflix acknowledges that it is mainly limited to generic “brand” advertising, Amazon has enough information on its customers, through its e-commerce site and its Fresh grocery stores, to serve highly personalised ads. What’s more, it can measure the effectiveness of those ads, by observing viewers’ subsequent behaviour in its shops.
Tom Harrington of Enders Analysis, a research firm, likens the approach to Amazon’s strategy in retail. The company began by selling its own products, before opening its marketplace to other traders. These days two-thirds of sales on Amazon.com are made by third parties, with Amazon taking a commission—a much higher-margin business than selling its own wares. Its aim is to be the same kind of “landlord” in video, believes Mr Harrington.
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