Dive Brief:

• Amazon is enabling merchants to send email marketing messages to a wider swath of customers through a Tailored Audiences tool unveiled at its Accelerate conference.
• The idea is to help sellers reach loyal, high-spending and new shoppers beyond those that choose to follow their pages. The platform will help brands track email performance metrics such as click-through rates, delivery rates, opt-out rates, sales and conversions.
• Tailored Audiences is currently in beta but Amazon said the program, which is available at no cost through its Seller Central portal, will go wide to U.S. sellers early next year. Opening channels for sellers to market directly to customers comes as Amazon contends with cooling e-commerce growth and makes a bigger push into digital advertising.

Dive Insight:

Amazon is expanding email marketing capabilities for sellers to help them foster stronger loyalty and attract new shoppers into the fold. While Tailored Audiences won’t be widely available in the U.S. until next year, the beta comes as marketers lock in their holiday strategies, which could provide fertile testing ground ahead of the rollout. The tool was one of several marketing-related announcements made at Accelerate this week.

Consumers have previously been able to “follow” their preferred brands on Amazon to receive notifications about special deals and shopping events through a Brand Follow feature. Tailored Audiences lets sellers send similar email messages to a broader set of customers for the first time.

The offering is a response to a desire expressed among brands to “increase customer lifetime value,” Amazon executives said. Amazon is expected to capture nearly 40% of e-commerce sales in the U.S. this year, a double-edged sword for merchants that account for more than half of its physical product sales but need to stand out in a growing sea of goods.

The platform has long had a complicated relationship with sellers, and Tailored Audiences could be a way to win favor with the third parties that keep its e-commerce juggernaut chugging. It could also frustrate customers who don’t necessarily want emails piling up in their inbox.

Along with making the email marketing perk free, the e-commerce giant plans to roll out custom HTML content and more robust templates to help campaigns pop.

“With these capabilities, Amazon is helping to put more control into the hands of brands around how they market to their customers,” said James Gossling, director of e-commerce at Sports Research, in a statement attached to the news. “These email marketing capabilities are exactly what we’re looking for to keep our customers coming back.”

Amazon has recently introduced other ways for sellers to gussy up their presence on its site. The company pointed to a Premium A+ Content tool that allows merchants to integrate richer media modules, including video, image carousels and Q&As, into product pages. Brands using the feature have seen sales increase by up to 20%, according to Amazon.

However, the broader e-commerce business is slowing following a frenzy earlier in the pandemic. Online retail sales at Amazon dipped 4% year over year in the second quarter to $50.86 billion, the second straight quarter of declines. Meanwhile, ad sales have remained a strength and were up 18% over the year-ago period to $8.76 billion in Q2.