Amazon released a statement announcing the acquisition of Sizmek. The online advertising company declared bankruptcy in early 2019, and discussions with Amazon began shortly after. The deal makes sense for Amazon as it plans to bulk up its “other revenue” category that’s already substantiated by Amazon Advertising. Continue reading to learn about Amazon and Sizmek and what we expect to see moving forward.
What We Know About Amazon’s Acquisition of Sizmek
Financial terms of this deal haven’t been released, but Amazon made this move to better serve its advertisers. The deal includes Sizmek’s ad server and Dynamic Creative Optimization (DCO) solution. At first, the Amazon Advertising and Sizmek teams will work separately, but they do have mutual customers.
Sizmek’s ad server will help Amazon gain more visibility into consumer data. Ad servers automate the process of requesting, bidding, serving, and reporting ad campaigns. Currently, Amazon only has insight into its own customer data. Access to Sizmek’s ad server will allow Amazon to work with additional data points and create a more holistic view within its offering.
Amazon’s access to Sizmek’s DCO solution will likely help improve and expand dynamic ads. Although Amazon has dynamic ads, they can only be used in campaigns for advertisers who sell on Amazon and drive traffic to an Amazon product page. Over time, we expect to see dynamic ads become available to non-endemic advertisers and drive traffic to new places on and off of Amazon.
What Does the Acquisition Mean for Amazon and Google Competition?
This acquisition pushes Amazon into a better position to continue to compete with Google. For example, as a result, Amazon is poised to gain new clients from Sizmek. These new clients will work with Amazon either because they don’t want the hassle of switching advertisers, or they have an aversion to Google.
While gaining new clients is a perk of the deal with Sizmek, added revenue isn’t the only driver. Now that Amazon owns Sizmek’s ad server, it won’t have to rely on someone else’s technology to deliver a solidified advertising offering. An ad server will strengthen Amazon’s advertising offering, and potentially make other elements of Amazon Advertising attractive enough for advertisers to leave Google completely.
Amazon acquires Sizmek Ad Server and DCO solution and proves how serious it is about solidifying its advertising offerings and establishing itself as a leader in the advertising space, particularly in its continued battle with Google. We look forward to learning how this acquisition will evolve and develop in the months to come.
In the meantime, if you have any questions or need a resource for Amazon Advertising, we’re here to help.