Amazon Prime Video is gearing up for significant changes aimed at its advertising strategy starting in 2025. Known for its vast array of movies and television shows, the streaming service is set to increase the number of ads viewers see, marking another chapter in the fierce competition among streaming giants like Netflix and Disney+ for advertising dollars.
The announcement stems from insights shared by Kelly Day, Amazon's Vice President of Prime Video International, during her discussions with media outlets, including The Financial Times. Day noted, "Prime Video’s advertising load would ramp up a little bit more in 2025," which hints at potential changes to the way ads will be served during viewers' streaming experiences.
Currently, Prime Video has implemented what Day described as a “very light” ad load, which consists mostly of advertisements running before and after streams. Viewers haven’t had ads interrupt their shows, but this gentle introduction appears set to change. While the specifics of how the additional ads will manifest—whether they will appear mid-show—are still under wraps, it’s clear Amazon is planning to leverage its vast reach.
According to recent data quoted by Day, Amazon can access approximately 19 million viewers monthly just in the UK, representing nearly one-third of the population. On a global scale, Prime Video can reach about 200 million people, over half of whom are located within the U.S., which positions Amazon favorably as it enhances its advertising inventory.
Amazon's ambitions appear partly fueled by its success since launching ads on Prime Video earlier this year. This move has garnered over $1.8 billion in upfront advertising commitments, with substantial gains seen across its ad-supported tier. Such substantial traction indicates advertisers are recognizing the platform's capacity for reaching significant audiences.
The shift toward interactive and “shoppable” ads on Prime Video is something advertisers are likely to find appealing. These new formats will allow viewers to engage directly with the content advertised, for example, by adding items to their Amazon shopping carts right from the ad without leaving the show. This feature aims to create seamless marketing experiences, blending entertainment with e-commerce. Day emphasised this potential, stating, "We have not changed our plans to have meaningfully fewer ads than linear TV and other streaming TV providers, and evaluate advertising volumes to help deliver a great customer experience."
Although Amazon has entered the ad arena with caution, they seem to be pleased with the response so far. Day shared, "It was actually gone much, much smoother than we anticipated," noting customer churn—particularly the number of subscribers dropping their service—has been much lower than predicted since ads were introduced. Less than 20% of customers opted for the ad-free version, underscoring viewers' general acceptance of the advertising approach.
This increase in ad load is also notable considering the broader industry shift toward monetizing streaming services through ads. Rivals like Netflix and Disney+ have also adopted their ad-supported tiers recently, echoing similar strategies to boost revenue after many streaming platforms realized mere subscriptions were not delivering profitability.
What’s interesting, though, is how Amazon’s approach diverges from Netflix. Where Netflix pivoted to introduce cheaper ad-supported alternatives to its viewer base, Amazon opted for the opposite—a higher-priced ad-free tier. This unique stance has drawn some competitive criticism from rival services. Critics argue it's counterintuitive, especially since many viewed ad-supported streaming as primarily targeted at price-sensitive consumers. Nevertheless, Day confidently affirmed, "We know it was a bit of a contrarian approach to take. But it’s evidently played well for us. It’s exceeded customers’ expectations on what they might get from ads."
Adding to the competitive atmosphere, multiple streaming platforms are now begrudgingly accepting the new normal of ad-supported video-on-demand, as created by Amazon and others. The market is flooded with advertisers seeking to gain visibility on thriving platforms. Day and her team believe this financial influx could finally allow Amazon to create more significant original content by easing the money crunch through ad revenue.
Yet, many industry watchers remain cautious about the saturation point for ads within the streaming environment. While Amazon asserts it will have “meaningfully fewer ads than linear TV and other streaming TV providers,” the balance between consumer experience and advertiser satisfaction will be gradually tested as more ads make their way onto screens. Critics suggest too many ads might risk alienation among viewers who have grown accustomed to uninterrupted viewing experiences.
A major driver of audience retention will be the quality of content. Day highlighted Amazon’s plans not only to increase advertising but also to expand its content offering, including live sports like the NFL's Thursday Night Football, which has averaged approximately 15 million viewers per game. This synergy between sports viewership and advertising revenue means Amazon can capitalize on prime viewing times when audiences are most engaged.
With the upcoming rollout of these advertising changes, many will be watching closely to see how Amazon balances these interests. For now, the company seems intent on solidifying its place within the ad-supported streaming market, aiming to shake things up and possibly draw the attention of advertisers who may feel stifled on platforms crowded with traditional ads.
So, get ready, 2025 is on track to be quite the year for Amazon Prime Video. More ads will lead to novel and interactive experiences, with hopes of not just increasing revenue but also enhancing the way viewers engage with content. This change could potentially reshape how advertising and streaming coalesce, meaning the viewers’ experience - and wallets - might just feel the influence of this significant shift.
