Simon Thorne, managing director, Flashtalking by Mediaocean, looks at the impact on multi-channel advertising following Amazons decision to close its ad server
By Contributor
Published: November 1, 2023
Simon Thorne, managing director, Flashtalking by Mediaocean, looks at the impact on multi-channel advertising following Amazon's decision to close its ad server
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Amazon has come a long way from its early days. A tech business trajectory that's so prevalent it borders on clich , the company has grown from a garage-founded online bookseller to the tech behemoth it is today. And no arm of the tech giant has grown as rapidly as its ad business, even outgrowing Amazon's profit powerhouse, AWS, earlier this year. Amazon's advertising business reached over $30 billion in revenue in 2023 and is expected to reach $70 billion by 2027, so October's news that it would be selling its ad-serving platform down the (Amazon) river came as a huge shock to some.
Amazon's ad server is an optional service used by its advertisers to manage and measure campaigns, and despite announcing that it will be sunsetting the service just a few months after expanding its features in June, Amazon continues to invest in future ad tech infrastructure, such as Amazon DSP, Amazon Marketing Cloud, and Amazon Publisher Services.
The changing role of the ad server But while Amazon's advertising business has been a skyrocketing success for a number of years, the organisation has found itself backed into a challenging position after sweeping changes within the ad industry. Ad servers were created to enable advertisers and agencies to generate a standardised tag, which is then delivered to numerous publishers, without having to make bespoke ads for each of them. Advertisers also needed an independent platform to verify impressions and clicks, which compiled performance from all publishers into one report. Ad servers have therefore become synonymous with a single source of truth - centralising measurement and ensuring that conversions between different publishers and, subsequently, channels are not duped.
However, the single source of truth concept has become increasingly problematic as the ad industry has evolved. Third-party cookies are due to be eliminated before the end of next year, and there has been a significant rise of so-called walled gardens , where platforms now keep strict control of their ecosystem and the data that resides within. It isn't possible to use impression tracking on Facebook, third-party tracking on YouTube is unavailable, Google anonymises referral URLs for organic search, Apple now limits its app tracking, and paid search increasingly uses parallel tracking. What's more, CTV and audio are delivered to devices and platforms where conversions simply don't happen.
And there are more channels today than ever before, including display, mobile, social, audio, CTV, DOOH, and more, with consumers expecting consistent and personalised messaging at every single brand touchpoint. With all these factors at play, perhaps Amazon's decision to wind down its ad server for good was not so much of a surprise after all.
An independent, holistic solution It's clear that to meet these expectations in a changing market, ad server platforms need to address the challenges advertisers face today and in the cookie-less future. The outdated single source of truth application is constrained, and the ecosystem is only getting more fragmented. In today's complex, multi-channel advertising space, ad servers need to activate campaigns and creative assets in all channels and walled gardens, but also add value beyond that.
Requirements now include personalisation, verification, and the optimisation of creative to tailor brand messaging to the consumer. Advertisers need help in planning, launching, managing, and reporting their campaigns across all of their channels, and they need this service to be consistent and streamlined. What's more, given the growth in CTV advertising - spend is expected to rise by over 50% between 2022 and 2025 - there is an increasing need for ad servers that can fully accommodate the format. These ad servers also need to be MRC-accredited to detect sophisticated invalid traffic (SIVT) in CTV as well as mobile and desktop formats.
The industry is also seeing advertisers increasingly seeking solutions that aren't owned by or biased towards big tech platforms. Given this shift, marketers and advertisers are looking for independent ad servers with omnichannel offerings - able to integrate across display, mobile, social, video, and connected TV channels. For ad servers, this is the dawn of a new era as a true activation partner.
Advertisers looking to harness omnichannel creative activation need a solution that prioritises automation, cookie-less measurement, and personalisation. This will allow them to simplify their ad operations, consolidating point solutions like their standard ad servers, social ads platforms, video ad servers, and creative personalisation systems into one platform. This way, advertisers can communicate their brand's message in a way that stays consistent and relevant despite today's fragmented media ecosystem. With tools that harness AI and creative ad tech to personalise and keep campaigns engaging, advertisers can make their content work harder and keep growing their brand.
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Simon Thorne, managing director, Flashtalking by Mediaocean, looks at the impact on multi-channel advertising following Amazons decision to close its ad server
