From product placements to pause ads: About Amazon’s take on OTT advertising

As India’s OTT ecosystem matures beyond its pandemic-fuelled growth spurt, platforms are shifting gears to reimagine both storytelling formats and monetisation strategies. On 17 June, Amazon introduced advertisements on Prime Video, a premium OTT platform that has long operated on an ad-free subscription model.

But the brand has been experimenting with advertising for a while now, and this new development was already in the works, with initial reports surfacing months ago.

With the new ‘limited ads’ format introduced on Prime Video, Amazon’s flagship OTT platform now mirrors the hybrid subscription approach of MX Player, the mass entertainment streaming service it acquired last year. 

Both platforms now offer a spectrum of monetisation models, reflecting a strategic pivot designed to meet evolving consumer expectations while enabling scalable brand engagement.

Hybrid monetisation models gain traction

Speaking to afaqs! about Amazon's advertising strategy on its OTT platforms, Girish Prabhu, head of Amazon Ads India, says the goal of advertising is not just to increase impressions but to deliver relevant, memorable brand experiences. 

"In OTT, you're not just scrolling through content, or flipping through newspapers, etc. You’re immersed in a story. That makes it possible to create more interesting ad formats, such as integrating a product directly into a scene," he explains.

Amazon is increasingly focused on creating native, commerce-connected experiences across its video platforms. Prabhu points to examples on MX Player where viewers can see an Amazon product listing just below the video player.

With a single tap, they can add the product to their wishlist or cart. "We want to tap into that impulse. Rather than letting the viewer think about it and come back later, we make it possible to act right away," he says.

Karan Bedi, director and head at Amazon MX Player, adds that the industry is moving past a binary view of AVOD versus SVOD. Platforms are now adapting hybrid models that let users choose their own balance of content access and advertising exposure.

"The idea is to give consumers as much choice as possible. These models are just potential ways for consumers to make their own decisions," he says.

Bedi stresses that premium storytelling demands time and capital, and it is becoming increasingly clear that ad revenues must be part of the monetisation mix. "Creating great content takes effort and investment. And these hybrid models are key to provide such services sustainably, without compromising on the quality of content and storytelling," he adds.

The rise of micro dramas and new formats

This flexibility in monetisation also opens doors for experimenting with content formats. One such innovation is the rise of short-form narrative storytelling. MX Player has launched micro dramas though MX Fatafat: episodic shows with each instalment lasting just one to two minutes. 

These are fully developed narratives designed for quick consumption, with one to two minute runtime, and 60-70 episodes per season, with investments going into quality writing, directing, and production, to ensure high quality content experience, as per Bedi.

He adds that such snackable formats are tailored for moments in the day when viewers may not have time to engage with long-form content. "Sometimes you have an hour to spare, sometimes five minutes. When you only have a short window, you’re unlikely to resume a half-hour show. That’s when micro dramas fill the gap," he says.

This approach has allowed Amazon to diversify storytelling across its video ecosystem.

While Prime Video continues to focus on high-production dramas, documentaries, and licensed global content, MX Player experiments with reality shows, Asian serials, and highly contextual regional content. The recent expansion into micro dramas adds yet another layer of variety to MX’s catalogue.

"MX is mass entertainment. We have reality shows that run daily for 60 days, Korean dramas that stretch into hundreds of episodes, and now micro dramas that deliver high impact in short durations. Prime Video, on the other hand, offers premium content and deeper narratives," reveals Bedi.

AI-led targeting and real-time contextual ads

On the advertising side, Amazon’s approach is powered by machine learning to ensure contextual relevance and minimal disruption.

Prabhu explains that rather than rely solely on traditional ad breaks, the system looks for natural pauses in the user journey, such as video pauses or episode transitions, to introduce brand messaging.

"Pause ads are one such moment. If someone pauses a video, they are already indicating a break in attention. That’s when we can deliver a relevant brand message," he says.

The goal is to maximise brand recall without interfering with the viewing experience. "If we don’t think an ad will be relevant for a viewer, we won’t show it. It's better to have them move on to the next episode than interrupt the experience unnecessarily," Prabhu adds.

This level of precision is especially valuable as advertisers look for measurable outcomes over broad reach. 

Expanding the content universe

With a clearer monetisation engine and richer data insights, Amazon is doubling down on content investments across both platforms. Bedi shares that new titles are in the pipeline that reflect diverse genres and formats.

These include a reality drama called Rise and Fall, a procedural legal series, and Made in India, a documentary spotlighting legacy Indian brands. 

Bedi observes that Indian audiences today are more invested in character-led narratives than ever before.

"There’s an old saying that films are about stories, and TV is about characters. What we’re seeing now is a lot more character-led content is on the rise, that sustains across multiple genres," he says.

The goal, he adds, is to serve viewers across every possible viewing moment and mood. Whether it’s a weekend binge on Prime Video or a quick watch on MX Player between tasks, Amazon aims to be present with the right content in the right format, and increasingly, with the right advertising message.

"You might be watching micro-dramas during a commute or an eight-episode series over the weekend. Whatever the context, we aim to match content and commerce in ways that feel seamless and engaging," says Prabhu.

With two OTT platforms now running hybrid models and a growing arsenal of AI-led ad formats and micro content, Amazon appears well positioned not just to adapt to India’s shifting digital video economy, but to actively shape it.