Amazon will begin selling ads to developers to promote their Alexa skills and apps on the platform, according to a report from Bloomberg on Wednesday.
According to Bloomberg, Amazon is “inviting developers to advertise their apps” on Alexa in the form of pop-up ads on the screens of the company’s Echo Show smart displays. The goal is to hold developer interest, which gravitates more toward smartphone apps, while making a new revenue stream. Bloomberg said the former is the priority.
Amazon VP Aaron Rubenson, who works on developer tools, told Bloomberg that paid ads are “something that developers have asked us for.” But it’s likely not something customers have asked for—at least not directly.
After eight years, there are currently about 130,000 Alexa skills (apps, essentially), according to Amazon. The more people who use Alexa’s unique features, the more committed they’ll be to the service. This is particularly important for emerging tech, such as Amazon’s smart displays, which are still proving their value to consumers.
Surveys have shown that people primarily use their Echo devices for simple tasks, like looking up facts or as a timer, Bloomberg said. Keeping customers engaged with Echo products long-term has been a concern for Amazon, Bloomberg reported in December.
When we tested the Echo Show 15, we wished there was an easier way to navigate its features. The device provides Alexa tips and suggestions through an Alexa Suggestions widget and a section of the Home screen that sometimes shows “trending” or new Alexa skills. However, the random nature of these suggestions ultimately made them confusing.
Amazon also has a consumer-facing blog that showcases Alexa’s newest features, but a website can’t force information onto people the same way a pop-up ad can.
Amazon just hasn’t been able to come up with a streamlined, effective method of advertising Alexa skills in a way that will consistently reach users. Instead of solving that problem on its own, it seems the company is asking developers to spend their own money to inform users about Alexa skills and for Echo Show users to deal with ads.
Amazon is reportedly increasing the amount of money it gives to developers for in-app purchases and subscriptions from 70 percent to 80 percent if they make under $1 million. Those developers will also be able to get a 10 percent cash rebate, and Amazon may throw in credits to be used for ads and more down the line, Rubenson told Bloomberg.
For developers of Alexa skills that don’t make revenue, Amazon is looking to increase payouts if those skills are particularly refined or popular, Bloomberg reported.
Fortunately, Echo speakers, which are a bigger product for Amazon than Echo Show displays and include its best-selling hardware in the form of the Echo Dot, are safe from intrusive ads for now.