Amazon’s Kindle Ads Drive Interest, while Search Delivers Results

Amazon’s sheer size (65 million unique visitors in April) gives it a powerful soapbox from which it can pitch virtually anything to its captive audience. Many of the tens of millions of U.S. consumers that visit its homepage each month have undoubtedly noticed the site’s ongoing, fervent promotion of its popular Kindle ebook reader. Since the original Kindle launched in late 2007, Amazon has marketed Kindle almost without interruption on its homepage.

Amazon continues to update and test new advertising messages for Kindle, and on any given day cycles a couple different ads on the site. In May, these Kindle ads generated over 60 million ad impressions and since the start of the year, the ads have seen steadily increasing clickthrough rates, with expected spikes corresponding with new product introductions. The highest clickthrough rates were reached the week ending February 14th following the introduction of the 2nd generation reader. In total, 3.4% of homepage visits that week resulted in shoppers clicking to see the new Kindle.

These efforts, coupled with largely positive reviews, have helped drive high consumer demand for Kindle. Kindle interest has grown steadily over the past 18 months, with recent jumps attributable to the 2nd generation launch in February and the announcement of the larger-format DX reader last month. Over a million consumers shopped for the updated Kindle during its first week on the market. Luckily for both consumers and Amazon, the company seems to have worked through production bottlenecks and accompanying stock-outs that plagued the original device’s launch.

The fact that the Kindle homepage ads have remained so prominent for so long is a clear sign that Amazon believes they are working in driving consumer interest. Given the value of the real estate the ads occupy (500 x 300 pixels), something else would have long ago replaced them had they not generated sufficient results for the company. From a broader perspective; however, how well are the ads performing relative to other referral sources such as search and email in driving interested consumers to consider a Kindle purchase?

In May, the homepage ads drove nearly 45% of all visits to the Kindle product pages, while another 26% of traffic was referred from other places within Amazon (banner text links, on-site search, category navigation, etc.). Search engines (such as Google) and Amazon’s email campaigns drove 6% and 5% of traffic, respectively.

From a post-click engagement perspective, search engines drove the highest level of Kindle engagement and purchase intent. Searchers averaged over 5 minutes on the page learning about Kindle, versus just 3 ½ minutes for consumers referred through the homepage links. Search also performed best at driving consumers to purchase. This is understandable given that searchers are by definition looking for the product to begin with rather than reacting to a marketing message placed in front of them. 4.3% of consumers referred via search engines added the Kindle to their shopping carts, slightly higher than homepage and other Amazon referred traffic sources. Email, on the other hand, fared poorly with consumers spending considerably less time viewing the product and relatively far fewer demonstrating immediate purchase intent

With Kindle, Amazon seems to have a created a product that corrects for many of the problems that slowed consumer adoption of earlier attempts at ebook readers. If consumers continue to clamor for these devices, I wouldn’t expect Amazon’s Kindle ads to disappear from the homepage anytime soon.

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About Matt Pace:
As VP of Retail and Consumer Products at Compete, Matt Pace is responsible for leading a team of client services professionals who deliver digital intelligence and insights to clients in the retail and consumer packaged good industries. Before Matt joined the Compete Team he was a CPA and senior auditor with Deloitte & Touche. Follow Matt on Twitter @mattpace.