Meta has rolled out a new feature that simplifies the conversion process for Amazon sellers.
Shoppers in the U.S. can now link their Facebook and Instagram accounts to Amazon, enabling them to buy products advertised in their feeds without having to leave the mobile apps.
Why we care. Maurice Rahmey, co-founder and co-CEO of Disruptive Digital, described the new feature as “the most significant ad product of the year.” Explaining why the rollout is such a big deal, he said on LinkedIn:
- “Better targeting and optimization: Meta will now be using information sent from Amazon and stores offering Buy with Prime to show consumer’s ads.”
- “Better conversion rates: Consumers will be able to check out more quickly on ads when they connect their account.”
- “Better ads creative personalization: Meta will tailor an ad’s messaging and product page based on whether a user is a Prime member or not and alter additional information such as real-time pricing and shipping estimates.”
How it works. Meta users can now click on ads in Facebook or Instagram, taking them to a shop-like experience within the apps for easy purchases. Using their linked Prime accounts, consumers can buy products without entering card details.
Benefits for advertisers. Rahmey explained that this new collaboartion could prove to be a significant revenue opportunity for Meta, Amazon and advertisers:
- Better ad signals. “Meta gets more ads signal from the top ecommerce store on the web and more attributable conversions to increase client investment.”
- Increased transaction fees. “Amazon gets more transaction fees driven directly from the greatest discovery ads engine on mobile meaning more sales on their platform vs other retailers.”
- More conversions. “Merchants get to expand their conversion volume with an additional sales channel and 1:1 measurement between their likely top ad platform and retail partner.”
Why now. Following Apple’s privacy changes in 2021, which made it tougher for social media companies to target users, Meta faced a major hit to its ad revenue. This, combined with a tough digital ad market, caused Meta’s stock to drop by 64% last year.
After three quarter of revenue declines, Meta bounced back in terms of ad revenue earlier this year, which the company attributes to its continued investments in AI. With that in mind, it’s little wonder the tech giant is exploring additional ways to improve ad revenue by collaborating with retail giant Amazon.
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What Amazon is saying. A spokesperson for Amazon said in a statement:
- “For the first time, customers will be able to shop Amazon’s Facebook and Instagram ads and check out with Amazon without leaving the social media apps.”
- “Customers in the U.S. will see real-time pricing, Prime eligibility, delivery estimates, and product details on select Amazon product ads in Facebook and Instagram as part of the new experience.”
Deep dive. For more information on Meta’s ad revenue performance, read our report on the company’s third-quarter success after it surpassed expectations to increase profit by 23%.
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