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10 minutes of expert insights every weekday. Your morning ritual for staying ahead in retail media.
Amazon's Agent Door Only Swings One Way
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[00:00:00] Kiri Masters: Amazon is a company that has always contended with contradictions. By being obsessively focused on the customer experience, things like lowest cost, best service, such [00:00:15] policies inadvertently impact brand suppliers. Because of its ubiquity, most brands don't feel like they have much of a choice but to sell there anyway.
[00:00:26] And surprise, those that choose not [00:00:30] to end up having their products available to purchase anyway, most recently with Amazon's Buy For Me shopping agent. In another contradiction, Amazon also built one of the ad industry's leading DSPs, a [00:00:45] front door to buying media across the open web, but it won't let rival DSPs touch its own ad inventory.
[00:00:54] We've all got used to these contradictions in terms, this [00:01:00] frenemy infrastructure, but still every so often the bold-faced audacity of it still catches me by surprise.
[00:01:10]
[00:01:11] Kiri Masters: I had one of those moments last week when I listened to [00:01:15] Christine Russo's What Just Happened podcast, where she had on Justin Honaman, who is AWS's Global Head of Retail, Consumer Goods, and Restaurants, To talk about agentic commerce, and one thing that Honaman [00:01:30] mentioned perked up my ears when he described what he called off-site search, where a shopper begins a product hunt inside an LLM rather than on a retailer's site, and he suggests that this is a problem that [00:01:45] retailers ought to be solving.
[00:01:47] This is what he said on the podcast. When you hear retailers talking about off-site search, this is where a shopper might start their search on a Perplexity or a ChatGPT or Anthropic's platform, and then they're searching for product across sites, [00:02:00] and how do you ensure discoverability?
[00:02:02] He went on to frame this as a shared frontier that the retail industry should be tackling together. But of course, it isn't. Of all the companies in retail, Amazon is the one [00:02:15] opting out of the very behavior that it's describing
[00:02:18] So here's the contradiction. It is agents going out and agents kept out. Going out is Amazon's Buy For Me service, which most of you know by [00:02:30] now sends Amazon's own agent onto other retailers' sites to transact on a shopper's behalf, including the sites of brands that have deliberately, consciously stayed off of Amazon.
[00:02:43] The burden of [00:02:45] refusing access falls on the brand, which has to email Amazon to a dedicated address to opt out. coming into Amazon, the posture flips. In November of last year, [00:03:00] Amazon sued Perplexity, alleging that its comet browser disguised automated sessions as ordinary Chrome traffic to shop on customer accounts.
[00:03:10] ~This has since been paused. So this is far from settled, but the reasoning is the part~
[00:03:10] ~In March, in March of this year, a federal judge granted Amazon a preliminary injunction. Since~
[00:03:10] In March of this year, a federal judge granted Amazon a [00:03:15] preliminary injunction, which has since been paused on appeal. So this matter is still ongoing. But the court found that Comet accessed accounts with the Amazon user's permission, but without authorization by Amazon. Amazon's [00:03:30] winning argument is that the agent acting on a shopper's explicit instruction is still trespassing if that platform didn't sign off.
[00:03:38] But if you apply that exact same logic to Amazon's own agent walking onto [00:03:45] a brand storefront, and the argument obviously falls down. When the agent is Amazon's, the customer's permission is enough. When it's someone else's, it isn't. Perplexity argued in court that the suit was never [00:04:00] really about security, that agents bypassed the ads that Amazon shows human shoppers, and ad revenue was the actual motive.
[00:04:10] Amazon, meanwhile, has blocked dozens of outside agents, pretty much everyone [00:04:15] that you can imagine or think of, and the list keeps getting longer and longer.
[00:04:19] All of this alongside building Rufus or now Alexa Shopping, its own shopping assistant, which Amazon says drove close to twelve billion [00:04:30] dollars in incremental sales last year. So they're blocking for others while building their own Miracle Ads is the only retail media [00:04:45] solution designed for both one P and three P Marketplace brands. Why does that matter? Marketplace sellers demand a seamless advertiser experience that still offers full funnel ad formats, and retailers [00:05:00] need a flexible solution that allows you to scale your media business.
[00:05:04] Learn more@miracle.com. That's M-I-R-A-K l.com.
[00:05:12] Now regular listeners know [00:05:15] my view here that retail media is the monetization layer that sits on top of whatever surface a shopper uses to reach a transaction. Now read through that lens, Amazon's behavior is entirely coherent. [00:05:30] This is not just a case of the left hand doesn't know what the right hand's doing.
[00:05:34] By blocking inbound agents, it defends amazon.com as a surface that Amazon owns from end to end. The Buy For Me agent reaches into someone [00:05:45] else's surface and pulls the transaction back into the Amazon stack. Now, on the advertising side of the house, the DSP also does the same to other publishers
[00:05:57] Amazon's DSP is the only [00:06:00] way to buy Amazon owned and operated inventory on amazon.com, on Prime Video, on IMDb, et cetera It also allows you to buy inventory across the open web and on other connected TV [00:06:15] properties. But no other DSP can sell Amazon owned and operated ad inventory.
[00:06:21] So the one objective that spans across all of these activities is to own the path from shopper to checkout wherever it [00:06:30] runs. The trouble and the concern for Amazon is that the path is splintering faster than any one company can wall it off. At Google I/O last week, Google introduced Universal Cart, a checkout [00:06:45] that works across Search and Gemini with YouTube and Gmail to come, and noted that people shop across its services more than a billion times a day.
[00:06:56] And the subtext here is that none of those journeys [00:07:00] have to begin on amazon.com. Now, the Amazon versus Google piece is definitely a piece of its own, and I will get to it soon. But for now, the thing to notice is actually a little simpler.
[00:07:14] Brands are [00:07:15] being told to make themselves discoverable in third-party LLMs and to welcome agents onto their own sites in order to do so. The largest player in the room is telling them to do both while actually doing [00:07:30] neither themselves. Back when I ran an Amazon-focused marketing agency called Bobsled Marketing, the advice that I gave to our clients, which were mid-market brands, more than any other piece of advice was [00:07:45] this. Watch what Amazon does, not what it says.
[00:07:49] The two often don't line up, and they don't here either. What Amazon says is that offsite search is a shared problem for [00:08:00] retailers to solve together. What it's actually doing is defending its own surface and reaching into everyone else's
[00:08:07] That is the behavior to watch
[00:08:10]