How Amazon’s Ad Business Could Threaten Google and Facebook | Hacker News Reader

How Amazon’s Ad Business Could Threaten Google and Facebook

wsj.com

103 pointstim_sw75 comments

Since their ad program was released, I've been running ads on Amazon as well as ads on the other platform for both clients and myself.

Amazon's ad platform has always had fewer features, a crappier interface, worse third party software available, and has at times run by confusing rules that aren't fully documented.

None of that matters because it's 4-10x+ more cost effective and doesn't require a large budget or a sophisticated account structure to generate profitable sales in volume. In general the American people have demonstrated a preference and that preference is that more than half of them want to buy stuff on Amazon and not on other websites. Trying to get people to buy stuff on a non-Amazon website is rolling the stone uphill. It doesn't hurt that basically the entire middle class demographic in the US subscribes to Prime. If you sell physical things to customers online there is no better way to do it at this time.

There are many issues involved in selling stuff on Amazon (and being an Amazon customer) but those problems really pale in comparison to the business model of running your own store on non-Amazon fulfillment and paying GooFaceBannerAd to drive traffic to your website that would really prefer to be going to Amazon.

Does it have cookies to help you measure conversion? How does the implementation compare to Facebook Pixel or GA / GTM?

Yeah but those belong to Amazon. It's nothing like the FB pixel etc. and you get much less information than a good GA setup. It also depends on whether Amazon owns your products (Vendor) or if you own the products still (Seller). You get different sets of metrics based on that and also whether or not you pay extra for the fancy suite of metrics.

Thanks for sharing @j-c-hewitt, I was wondering about the vendor and seller distinction. I saw there were case studies of an insurance company increasing its quote requests. I suppose they're not listed as vendor on Amazon.

What metrics are there in the fancy suite?

https://www.operationroi.com/2017/09/amazon/understanding-am... (not my article but describes what it gives you)

So, you are saying while the general theory is that people want to buy stuff on Amazon but using the GooFaceBannerAd you are able to drive traffic to your non-Amazon store and sell stuff to people?

Edit: As I am getting downvoted let me clarify to the query. I am a bit confused as the post seems to suggest getting people to buy stuff from non-Amazon site has been difficult.

In which case I wonder how effective it is to bypass Amazon ad system and getting people to your own site. Or am I misunderstanding the post and the ad connects back to amazon product page.

It is confusing. No I'm referring to the internal Amazon ad system that the article mostly refers to. If you search around Amazon with your ad blocker off you'll see results with "Sponsored" next to them.

Thanks for the clarification. You are using these banner ads to drive traffic to a non-Amazon site or re-direct people back to Amazon product page? Because selling stuff on former seems difficult.

We see (or are forced to see) ads on Google, Facebook et al. is because they are free to use services for consumers. Eventhough that bother some us so much that we use all sort of ad blocking plug-ins at our disposal to stop seeing those pesky ads. I pay for my Amazon Prime membership and for every product I purchase on Amazon.com. Last thing I want is getting bombarded by obnoxious ads. while shopping for my next two-day delivery of Topo Chico water bottles there. Unless Amazon decides to roll out a steeply discounted Prime membership program, I would be a very unhappy customer seeing ads on a paid platform.

Ads for Amazon is like Walmart choosing what product to be put on display and where. It is an established business.

I echo some of your sentiment. If Amazon is truly as customer obsessive as they branded themselves, they would avoid putting cheap ads out there. Since their click rate is going to be so high, those ads will be very expensive indeed, which I would assume to be quality ads as well.

Quality ads would be like "hey see that you are buying Topo Chico. Why don't you try these new flavors as well at a discounted rate?". Instead of "Buy Nestle water" ads. Or something very unrelated. Basically a win-win situation for both parties.

But to be honest I would be very much reluctant at seeing a lot of ads. They do this already with "Sponsored" products and most of the time it serves as distraction instead of convincing buyer into even at least clicking their ad.

This is what I never understood in online ads. You're looking to buy, say, a North Face jacket but the price is a bit higher than you're willing to pay, so you close the tab.

Now, you go elsewhere on the web and you see ads for that particular jacket, but there's no incentive for you to click on the ad because you already know the price is too high.

But if the ad says: "hey, 10% off on this jacket in the next 30 minutes with coupon code xyz" then yeah you might click on the ad, buy the jacket and in the end, the customer, the retailer and the ad agency are all winning.

If you could manipulate coupon codes like that then why would anybody pay full price (if it wasn't urgent)?

Not everyone is that savvy or willing to put in the effort.

There are people who save ridiculous amounts with traditional coupons, but not many people are willing to put in the effort or make the sacrifices to to that, so they still work for the companies.

I bet a lot of people would still pay full price. I mean, Gap has 30% off coupons every week like clockwork. 40% off is pretty regular, too, so why would anyone pay full price? Well, I bet a lot of people do.

In a retail environment, the choice of product position on a shelf or display is often not entirely the random choice of the retailer; the producer may be paying for that. IN publishing, where I work, there's a system known as 'coop' (cooperative marketing) in which the publisher credits the bookseller in exchange for favorable positions on a table or other visible spot (it's legal as long as the deal is clear to all and terms are offered to all). Normally these sorts of promotional considerations are hidden from the consumer. Recall that back when Amazon was still primarily a bookseller, they had actual category editors who chose books to be featured on the category's opening page.

So just having paid advertising is just an extension of this. As Amazon acts less like a department store and more like the operator of a bazaar with thousands of merchants hawking their wares in the street, I guess it makes sense.

The ads are already there and have been for a while.

I much rather see ads on Amazon.com than anywhere else. I'm there in the market, I'm walking into the store and see ads for products, that's expected. I go in with a consumer mindset.

Everywhere else is the problem, I don't like being treated like I'm at the store every minute of the day, online and offline. I'm not looking to buy anything when I browse the internet, when I commute, when I'm at home and the phone keeps ringing to sell whatever, when I'm picking the kids at school and people keep trying to engage in sale talk and push flyers. It's exhausting.

Amazon is the place I'd least like to see adds. I want the environment where I'm making the purchasing decision to be the one with the least psychological manipulation.

Amazon needs to spend its money on improving its search, ranking, and review systems to customers can find the products they want themselves, not on adtech. Amazon's search is trash and it's always been trash. It's 2017, why does sort-by-ratings still rank products with a one 5-star review over products with 1000 reviews and an overall rating of 4.9 stars. There are better algorithms out there [1]. It also needs to put serious effort into fixing its fake reviews problem and counterfeiting problem.

Amazon's core search and shopping experience hasn't improved much in at least 10 years, possibly more. That needs to change.

[1] https://www.evanmiller.org/how-not-to-sort-by-average-rating...

Amazon already forces you to see what are effectively ads. Every page you visit has suggested items based on either similar search results, purchase history, current page content, content other users purchased after viewing a product, etc.

They just don't look like ads because they are indistinguishable from the rest of the amazon interface.

Facebook was more likely to threaten Google. But I think they failed, amazon won't be a threat.

Ps. A possible big competitor is not not considered a threat in this context. Just as Facebook is a big competitor to Google, but failed to be a threat

For me, Amazon will be because the nature of their advertising is intent-based, like Google's. What Facebook has always struggled with is the context of the adverts (by their very nature), whereas Google and Amazon's advertisers already have the user's intent right there (searches for services/products).

What use is intent if you know every single intimate detail of a person's private life.

Judging by the ads I get on Facebook: a lot.

With the difference that Amazon queries are a subset of Google's queries. When using the same keywords, you should add "buy online" / "shop" on Google.

And some people on HN just don't want to buy on Amazon because of counterfeit products. Ads on Amazon will probably make it worse.

Facebook also has a search-engine (with a search-bar), and for all we know, 95% of the population may be using it.

Facebook's search is so bad it almost feels like it has been abandoned by their product team.

I think it may even be worse than Reddit's search.

The real question is does intent matter for Facebook these days. If I am browsing around to buy something, companies leave cookies that aalow them to retarget wherever you go and since you spend a lot of time on Facebook, you will be retargeted there anyway.

I still believe that Facebook could take the niche "garage sale" market from Ebay. My wife used to sell on Craig's List quite a bit but the majority of the activity has moved to Facebook. Facebook could take and process payments, if they can for garage sale items I am not aware of it, quite easily and from there move into third party sales to provide Amazon with some heavy competition. As it stands friends I know are migrating from facebook to instagram to get away from political and weird/shock meme content. It could be something that kept the 35-45 demographic from decaying.

...all anecdotal.

Neither Google or Facebook can really do consumer sales. To do consumer sales you have to treat everyone as a potential customer. Google and Facebook really only pay attention to customers who have already agreed to spend a significant amount of money.

They could pay attention to the person doing the selling, whose customer is the buyer. Swap-meets are generally one-way markets; much less swapping and more of a marketplace to sell (cheap) goods.

eBay is better positioned than Facebook because most everything I have ever seen sold on Facebook is garbage and was never something I would have thought to buy.

Facebook has a different ad network than Google. Google is really good for intent-based advertising (Shopping for example) and Facebook is really good for prospecting (finding new buyers).

Neither are threats to either. The only way google or facebook or amazon loses anything if they lose customers visiting their properties. Amazon isn't even entering google or facebook's domain.

This is just another in a long series of "i hate google/facebook/social media" propaganda pushed by the media on HN.

There hasn't been a day without an anti-google/facebook/social media post on HN for months now. You can use the waybackmachine to check for yourself. It's incredible.

I use AMS for my publishing business. Amazon sales were up 73% the first year I started using it, although in the same year I also launched several new products that did well (and did not benefit much from AMS ads).

Yes, the UI blows, there are various unfathomable policies ("One or more of your products doesn't meet the financial threshold established by Amazon and is no longer eligible for advertising" - this for one of our top-selling titles), and the reporting leaves a lot to be desired, but at the end of the day it works.

The same cannot be said for Facebook ads (waste of time and money for what I sell), Google AdWords (hurt by its own popularity and ridiculous policies such as this one: http://www.digitalmediamachine.com/2017/10/google-kills-my-a...), and LinkedIn which is fleecing small-business clients with sky-high CPCs that don't perform.

I fear, however, that the popularity of AMS may cause the same fallout as AdWords - loads of buyers rushing in, driving up rates and driving organic results off the page.

Hello!

I used to working on the AMS self-service advertising team as a developer.

Note all opinions are my own.

When I first joined the advertising team, I was unsure about a product that can have a seedy sort of reputation on the web. But I was very pleasantly surprised how much we care about the customer experience in regards to ads at Amazon.

The end goal is always to show the customer the best item for purchase, and Retail would always set a high bar for the Ads team. This has in-turn caused us to invest a lot into ensuring the relevancy of our ads is top notch, we do not want to display ads which are ineffective - this hurts both the retail customer and the advertiser.

Nothing would get approved without vigorous testing to ensure the ads had a neutral or positive impact on the retail customer.

While I don't doubt your personal integrity, I am sure a Google or Facebook employee would claim the same. After a while, organizational incentives start nudging you in a direction optimal for the company and not necessarily optimal for the user. It starts in slow imperceptible increments and before you know, your product is ad-infested sub-optimal UX.

Except ads aren't Amazon's primary business or revenue stream. They're incentivized to do exactly what the OP stated.

Or so one would think. But you can try for yourself and see how ad-infested Amazon has become.

To throw a few random examples, I just tried (from Mac / Chrome / Incognito / Signed-out mode), I searched for "sensodyne toothpase". Entire page is full of ads and I have to do a full scroll to see organic non-ads results. Same for "biodegradable trash bags". Almost the same situation for "qtips" though there were 2 partial images of organic search results. Its almost as if I am searching on Google (and no, thats not a compliment).

Not to demean you, personally, but you sound like every other bright eyed ad-team member I've ever spoken with. Have you worked at other "top-tier" advertising platforms like AdWords, or Facebook, or Yelp?

Do you think anyone on the AdWords team feels differently about their product? That's why their public statements are so convincing, because they believe them.

Maybe Amazon's situation is different. Alls I'm saying is that I have no way of knowing.

Ads is free money from Amazon. After all they have the best possible traffic one can imagine: clear shopping intent queries, with customer shopping history. They just need to put up the billboards, the money will follow. Maybe not Google scale, but free money, what not to like?

Several things... for example: as a seller advertising on Amazon, you are sharing all your profit metrics with a potential competitor who has a history of stepping in with their own proprietary branded products where they see significant profits to be made.

Maybe I'm biased, but personally, I never ever clicked on any ads showed up along my google search query, even if they are relevant. I just can't get rid of the nagging feeling that: "there gotta be better deals else where (e.g. on Amazon?)" or "The merchant paid Google a premium to show up along side my search results, the price can't possibly be the lowest". Am I the only one feeling this way?

We changed the URL from http://archive.is/ZdCQL.

Please post the original link. It's fine to include a link to an archived version in the comments. Users frequently do that as a favor to other readers. But please don't submit archive links to begin with, because they obscures the source of the article and mess up the data.

which data?

Probably dupe check and other things that rely on the correct domain.

Things like this: https://news.ycombinator.com/from?site=wsj.com. Nothing too surprising, but surprisingly essential to the coherence of the site.

What about domains that are instaflagged? For example, I tried posting a Breitbart article [0] about a conservative blogger at Google, because in this one case I felt like it was the best "primary source" to get the discussion started. It was auto-killed like every article on Breitbart. [1] So I resubmitted via archive.is and actually got 6 upvotes [2], showing there was at least some interest in the topic that would never had surfaced if I used the original link.

[0] https://news.ycombinator.com/item?id=16103017

[1] https://news.ycombinator.com/from?site=breitbart.com

[2] https://news.ycombinator.com/item?id=16246184

I'm hellbanned because HN doesn't like my views. Sometimes my comments do go through for whatever reason.

You're banned because you've serially abused HN and broken the site guidelines many times. If you don't want to be banned on HN, you're welcome to email hn@ycombinator.com and give us reason to believe that you'll follow the rules in the future.

Have we really arrived at a place where "conservative blogger" is an accurate description of a person who:

* "isn't exactly allergic to the stuff" (re: white nationalism)

* wrote "Not all humans are born the same, of course, and the innate character and intelligence of some is more suited to mastery than slavery. For others, it is more suited to slavery. "

* asked "What's so bad about the Nazis?"

* etc

I'm not sure if it's liberals or conservatives who should be offended by that. Hopefully both.

The interesting part of that article was that his views were sufficient to silently land him on a “do not visit” list at Google HQ, which implies that Google is tracking people who hold such opinions and adding them to such lists.

No great conspiracy here. Any mid to large org maintain such lists. If you fire someone who is wasting the orgs time, do you then want him to show up/get hired/be entertained by some group in the next building/next campus etc who have no idea what the story is?

The guy is not an ex-Google employee. This event was named in the Damore lawsuit as evidence of discrimination against political views because all he was guilty of was blogging things someone at Google had a problem with.

It doesn’t make you uncomfortable to know that even if you’ve had no previous interactions with Google, you may be tracked and added to a list of undesirables? Who controls the list, who has power to add people to it, and what else are they doing with this list? What if they’re looking at his search history too? Would that be okay?

As long as the list is used for "people who will/won't be invited to speak at Google HQ", and not used to influence search results, I have zero problems with it.

Google are a private company with no requirement (barring legal strictures) to allow anyone onto their campus. If they want a list of undesirables, they can have one. Same as you've probably got one for your house.

This guy is clearly not conservative or liberal, he just seems crazy. However to escort him out seems astonishing and I am OK with discussing it

Exactly these so call "conservative" views are actually hard right ones if not oughtright fascist ones. In UK terms the national front or EDL.

Danmore did not want to say set up a group of googlers into field sports (hunting Shooting and Fishing) did he.

Would you really, really please not take HN threads on generic ideological tangents? They are invariably train wrecks, and the trains here wreck easily.

https://news.ycombinator.com/newsguidelines.html

As far as I understand the HN mod team tries to reduce politically discussions as much as possible. For my taste they are doing a great job at this because it protects the community from tearing apart. There are so many places that had once interesting discussions and now have morphed into political shouting matches - for me Twitter is a main example of that. I personally like that culture on HN and I am trying to contribute by flagging any politically charged topics no matter if they are leaning left or right.

I also like that culture, and hate political spam on HN, but I found this article relevant due to its relation to Google. In general, politics that intersect with tech tend to generate fairly extensive and generally mature HN discussions. See James Damore, Susan Fowler, etc. for examples.

In this case, I actually would not consider Breitbart to be the best source to report from (owing to their strong political bias).

The source of this complaint is the James Damore lawsuit filing here (https://www.scribd.com/document/368692388/James-Damore-Lawsu...). You can find the portion mentioning Curtis Yarvin on page 37. That would be the best primary source to link to.

(Even the lawsuit description is problematic to me, as the "influential conservative personalities" mentioned -- Alex Jones, Theodore Beale, and Curtis Yarvin -- all come from the "alt-right" / conspiracy-oriented / "neo-reactionary" side of conservatism. There's no indication that this list also includes other influential conservative personalities like, say, George Will and Charles Krauthammer, so at first the description in the lawsuit seems overly broad. But the lawsuit text provides more context than Breitbart did, IMHO.)

If the site is banned, as breitbart.com is, then you should either find another article on the topic, or failing that, email us at hn@ycombinator.com so we can take a look. I'd never rule out making an exception, but would probably want to post a comment in the thread explaining the situation to readers.

As for why breitbart.com is banned, one need look no further than this subthread. Posting from it is bomb-throwing whether you intend to or not, more or less regardless of the content. I suppose I should add that no, this is not because of political bias, it's because of anti-flamewar bias. There are sites with opposite politics which are banned for the same reason.

Can you share a list of banned domains?

I'm afraid not, because most are spam and we spend enough of life answering "why is my site banned" emails already.

Why is there not a true rival to Google Adsense?

The winner-take-all dynamics of the internet.

What would this look like compared to something like Kaiser Permanente?

Did you perhaps mean to ask this in the other Amazon thread right now?

https://news.ycombinator.com/item?id=16264662

Yup

I call BS, it's a bubble ad network.

The chances are users will be happier with a product through natural selection ( eg. better/trustwurthy reviews), than products through ads.

Although, Amazon could earn more in short term, users are less satisfied and they lose money long term.

What happens if Chinese vendors buy all the ads and set a lower price ( which they can). Then most buyers won't be satisfied on Amazon ( terrible English) and they start using AliExpress ( cheaper and same shipping terms after eg. 1 year of Chinese vendors that dominate Amazon). This "free money" could be their downfall.

Already technical users here on HN don't want to use Amazon for the risk of receiving counterfeit products.

Amazon is in complete control of the ads they show. Quality of ads is a huge goal of anyone working on an ad network trying to compete with Facebook or Google.

> Quality of ads is a huge goal

How you do that is part of the lifecycle of an Ad platform. The ephemeral "quality of ad" is completely subjective and will forever be inadequately measured (to anyone's satisfaction for very long). Eventually all ad networks are subject to market pressures in pursuit of margins. Third party ads eventually arise from the existing technical implementation of ads (tons of untrusted code running in js and vpaid applications), even when "prohibited". There's nothing special about Amazon's platform. Lots of platforms have been the "new hot thing" with "total control".

>Already technical users here on HN don't want to use Amazon for the risk of receiving counterfeit products.

Are you talking about low quality or counterfeit? Personally I don't care about counterfeit, but I do care about quality. In any case, Amazon already has been tackling it to some extent.

http://www.businessinsider.com/how-amazon-fights-counterfeit...

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