This month, the advertising industry is focused on two major media buying showcases - last week's digital-focused NewFronts and the upcoming television-focused upfronts - providing an opportunity to examine the evolving advertising landscape. Despite privacy challenges, threats from popular platforms, and the impact of artificial intelligence, digital ad spending is still expected to grow about 10% in 2024 and 2025, driven primarily by continued growth in retail media and connected TV, according to a recent report from Advertiser Perceptions.

As advertisers shift budgets to these two channels, traditional media groups and retailers with owned media networks are continuing their multi-year efforts to connect content and commerce. These new deals aim to leverage technological developments in both areas, combining the scale and brand-building power of CTV with the data-driven, performance-oriented capabilities of retail media.

"Media and ad tech companies need to build relationships with retail media platforms or risk missing out on one of the few large and rapidly growing segments of the digital advertising market," said Eric Haggstrom, director of business intelligence and head of forecasting at Advertiser Perceptions, in a statement related to the report.

With only days until the upfronts, Disney and NBCUniversal have already announced such deals, while Amazon - a leading retail media player with growing video ambitions - has been building anticipation for its first upfront event.

Consumer data takes center stage

In recent years, partnerships between media companies and retailers have steadily increased, driven by the proliferation of media networks and Google'sagain delayed third-party cookie deprecation plansand the anticipated signal loss. First-party data is at the core of retail media propositions and the advertising platforms developed by major media players, which aim to integrate content across channels.

NBCUniversal - a leader in targeting, measurement, and the future of streaming - announced a new partnership with Instacart this week, continuing itsefforts to turn television into a commerce-enabled performance marketing channel. The expanded partnership is expected to launch on streaming in Q2 and then expand to linear TV, allowing CPG advertisers to leverage ad exposure and purchase data to reach consumers active in the market and measure campaign effectiveness.

"Advertisers are increasingly prioritizing strategic audiences, and through this partnership, CPG brands will be able to connect with the next generation of grocery shoppers in a highly engaging environment," said Alison Levin, president of advertising and partnerships at NBCUniversal, in a statement.

NBCUniversal is Instacart's first official streaming partner, as the latter continues to build out its advertising platform, such assupporting Google Shopping adsand partnering with third-party verification providers - efforts that helped Instacart earn the Media Rating Council'sfirst advertising accreditation. The latest agreement helps CPG brands connect with high-intent consumers and prove campaign effectiveness through closed-loop measurement, said Tim Castelli, vice president of global advertising sales at Instacart.

"Consumers can see CPG ads on streaming and receive products within an hour through Instacart," Castelli said in a statement. "It's a win-win for consumers and brands."

"Media and ad tech companies need to build relationships with retail media platforms or risk missing out on one of the few large and rapidly growing segments of the digital advertising market."

- Eric Haggstrom, Advertiser Perceptions

Similarly, Disney Advertising today (May 8) announced a partnership with Walmart Connect to provide advertisers with enhanced audience targeting and closed-loop measurement capabilities for their brand campaigns on CTV inventory across Disney+ and Hulu, according to details shared with Marketing Dive.

The proof-of-concept project will launch in Q2 with initial advertisers spanning categories including CPG, consumer electronics, telecom, automotive, apparel, and beauty, before expanding to all eligible advertisers in the following months. The partnership allows Walmart Connect advertisers to apply the retailer's first-party shopper data for targeting and measurement in programmatic buying, leveraging Disney's audience graph to help marketers better understand purchase intent and outcomes.

"Disney is committed to bringing innovative solutions to advertisers, leveraging unique and actionable first-party data-driven insights and proving effectiveness through the most transformative technology," said Jamie Power, senior vice president of addressable sales at Disney, in a statement. "Walmart has incredible data insights on planning and measurement, combined with the most impactful streaming environment - a winning combination for advertisers."

Walmart Connect saw 22% revenue growth in Q4 2023, having previously touted its performance with video platformsRoku, TikTok, and TalkShopLiveand has beguncourting non-endemic brandsacross automotive, entertainment, financial services, quick-service restaurants, and travel industries. As part of the agreement, Disney will join Walmart Connect's partner lab, which NBCUniversal joined last year.

According to Nicole Perrin, senior vice president of business intelligence at Advertiser Perceptions, partnerships like the expanded NBCUniversal-Instacart deal and the new Disney-Walmart Connect agreement are likely to proliferate due to data signal loss caused by industry and regulatory changes.

"Media sellers are facing at least as much pressure as ever from advertisers to help them reach the right audiences and prove that advertising works," Perrin said in email commentary. "Organizations that have their own first-party consumer data to use for targeting and measuring ads will look to partner with media sellers in ways that are privacy-safe for consumers while protecting the organization's owned data assets."

Amazon's shadow

If Walmart'sproposed acquisitionof smart TV maker Vizio clears regulatory hurdles, it could become an even bigger player in the convergence of retail media and CTV - but it won't be alone. Amazon's advertising business continues to grow, driven primarily by product ads on its e-commerce marketplace, and it introduced ads on Prime Video in January,with early results encouraging, according to last week's earnings call.

Amazon's continued focus on Prime Video, along with live-streaming service Twitch and ad-supported streaming service Freevee, comes as the company prepares for its upfront debut on May 14, after years of showcasing at NewFronts. Ahead of the presentation, the company yesterday (May 7) announced three new streaming TV ad formats to enhance interactivity and shoppability on Prime Video.

The new formats will be available in the upcoming broadcast year, including shoppable carousel ads that can be browsed during ad breaks, interactive pause ads with "add to cart" and "learn more" overlays, and interactive brand trivia ads offering brand storytelling and multiple customer engagement opportunities. The introduction of living room remote capabilities expands the availability of ad formats "far beyond QR codes," according to details shared with Marketing Dive.

"...streaming ad budgets are expected to see fierce competition in 2024, but modest growth."

- Eric Haggstrom, Advertiser Perceptions

"We are developing innovative experiences to help brands better engage with customers, while transforming streaming advertising through our differentiated reach, first-party signals, and ad tech portfolio," said Alan Moss, vice president of global advertising sales at Amazon Ads, in a statement. "Ads in Prime Video offer advertisers an unparalleled experience to achieve any full-funnel marketing goal - whether awareness, consideration, or conversion."

The new formats allow advertisers to reach Prime Video's ad-supported coverage of over 200 million global customers on average per month. Interactivity is quickly becoming standard in the CTV space, with Amazon's interactive ads driving 10 times more product page views and conversions than non-interactive formats, according to company research. The new capabilities, along with what else Amazon may showcase at the upfronts, could lay the groundwork for future incremental ad spending.

"In the long term, we believe Amazon will be able to attract incremental streaming budgets from SMBs advertising on its platform, but we expect minimal contribution in 2024," said Advertiser Perceptions' Haggstrom in his latest forecast. "These assumptions could be quickly overturned in the coming months, but expect fierce competition for streaming ad budgets in 2024, with modest growth."