It’s also what United Natural Foods, Inc., a publicly traded wholesale distributor for food and grocery items, has invested in, launching its own retail media network this spring called the UNFI Media Network. It developed the platform with Swiftly, a technology company that powers retail media networks.

Who owns your data?

Third-party data is information about consumers that a retailer or advertiser acquires through an entirely separate source. On the internet, that’s often done through third-party cookies. Third-party cookies are code used on websites that can live on in web browsers across multiple site visits. They essentially track user activity and inform targeted advertisements delivered to those users. Google had planned to phase out third-party cookies, but it recently announced it will not do so.

The intuitive alternative to third-party data is first-party data. First-party data is what retailers and advertisers acquire directly and voluntarily from consumers. It can include an email address or phone number that a consumer uses to sign up for a loyalty program, or the information that a consumer uses to complete a checkout on an ecommerce order. That’s the kind of data that powers retail media networks and advertising.

Both kinds of data allow retailers and advertisers to personalize digital ads based on consumers’ shopping behaviors.

“One of the things that we thought was so important about Swiftly versus other retail media platforms out there is that the retailer retains 100% control of the information and data of that shopper, of that loyalty subscriber,” Louis Martin, UNFI president of wholesale, told Digital Commerce 360. “They don’t have to give that away.”

What is an example of retail media advertising?

Sean Turner, cofounder and chief technology officer at Swiftly, showed Digital Commerce 360 examples of what retail media advertising can look like. Sharing his screen on a web-based call, Turner showed three kinds of personalized ads the UNFI Media Network can display using Swiftly technology.

1. Personalized pricing promotions

In the example above, the consumer has shopped at a Hen House location. The prices in the promotion are specific to the Hen House location where that consumer typically shops. Swiftly operates in the first-party cookie list identity space, Turner said.

“So we’re not cookie-ing users to try to track and target users,” Turner told Digital Commerce 360. “I’m actually getting explicit opt-in identities with a first-party login with the user’s email address, phone number into these retailer apps. And when we go and we target users, we’re actually able to target them using a data clean room, target these same shoppers off-platform in a privacy-compliant and cookie-less way.”

A data clean room “leverages the hash of your email address, so you’re not sharing any of the raw data, and it couldn’t be used to reverse-engineer-your email address,” he explained. It matches two people “without ever having to exchange any personally identifiable information,” he added.

He compared the process to a digital version of circular print ads. A local grocery store can send printed coupons and pricing — often on newsprint paper — to consumers and potential consumers near it. But because many shoppers are more inclined to check prices on their phones and computers than go through traditionally mailed circulars, companies like UNFI and Swiftly use retail media advertising capabilities to reach potential customers.

“If I just show you an ad and you’re out on the internet and it just says, well, hey, apples are $0.98 a pound, I don’t know where to go,” Turner said. “I don’t know where to buy it. I’m gonna probably just ignore that ad ’cause it’s not gonna register with me. But if it’s the retailer that you go to every week that’s branded that ad and it’s like, hey, these are the deals at that retailer, well, guess what? We’re seeing very, very high average return on ad spend for these ads.”

2. Product-based promotions

Another Swiftly-powered retail media ad highlights a specific product, as opposed to a pricing promotion.

Turner also showed Digital Commerce 360 a different use case for personalized retail media advertising. In the image above, the retail media ad shows Alexia-brand onion rings. Clicking on the ad takes users to a recipe page featuring the product.

Clicking through the Alexia onion ring ad takes online shoppers to a page that promotes a recipe featuring the product, as well as what other ingredients a shopper should purchase to make the recipe as shown.

“I’ve got all the products featured right below that, so it makes it super easy for me to add these to my shopping list or to add it to an ecommerce cart and actually go and buy the product,” Turned said. “You’ve got a pretty good, complete story there.”

3. In-app mobile advertising

Swiftly powers the retail media technology for St. Louis-based grocery retailer Dierbergs’ mobile app. Upon opening the app, a user might see an ad to make s’mores.

An ad on the Swiftly-powered Dierbergs mobile app calls users to make s’mores.

When a user clicks the ad, she is taken to a list of products that an advertiser or advertisers promote to complete the recipe in their call to action. In this case, those would be Hershey’s, Kraft and Mondelez.

The Dierbergs app shows which products to buy to make s’mores, based on the companies advertising.

The app then displays the products with pricing based on the location where the user shops. Additionally, it shows which aisles a user can go to in the store to find the products. Both of those details update automatically, as the retailer’s app is linked to its point-of-sale system.

The product detail page shows an image, pricing and the duration of the promotion. It also shows where to find the product in the user’s preferred store location.

The user can add the product to an ecommerce cart or to a list for physical shopping by clicking the plus symbol in green on the product detail page.

Dierbergs app users can add products to their shopping lists or digital carts.

The app sorts the products that consumers add to their lists to display by aisle, making in-store shopping more efficient.

Impact on regional and independents retailers

Retail media advertising is a critical capability for smaller retailers, Martin and Turner both told Digital Commerce 360. Any retailer working with UNFI or brand that sells to those retailers can participate in the UNFI Media Network, Martin said.

That includes some of the largest consumer packaged goods companies (CPGs), he said. Those CPGs typically come in with a checklist of expectations. That’s because they have the resources to understand what goes into advertising at that scale, he added.

“The flip side is we also have a universe of suppliers who don’t have that infrastructure,” Martin said. “They are small, natural organic suppliers. In many cases, they may be all the way down to still doing stuff in the garage of their home to maybe having one or two production facilities and able to supply to just a few.

“Well, they’re not the ones that can go to Walmart and get on the media platform because one, if Walmart turns it on, they’re not going to have the scale to keep up with it. But two, they don’t have the administrative infrastructure to engage. And so we’ve tried to make that very easy for that type of supplier by you can just simply go on our website and with a few clicks, sign up, put your brand on it.”

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The UNFI Media Network launched in May 2024. It extends digital marketing capabilities to more than 30,000 retail customer locations and about 11,000 brand partners, the distributor said.

Louis Martin, president of wholesale, United Natural Foods, Inc. (UNFI)

UNFI already offered what it called “professional services” to its clients. That included helping clients design the layout of a new store, shelving units, getting deals on refrigeration equipment, or getting better rates on credit card machines bought through the company.

What became clear was that retail media was a service UNFI’s independent and regional clients “were not getting full access to,” Louis Martin, UNFI president of wholesale, told Digital Commerce 360.

UNFI owns some retail banners, including Cub and Shoppers Value.

Why did UNFI start a retail media network?

There are a variety of reasons these independent and regional grocery stores were not getting full access, he said. One of those reasons is the scale at which the retailer can buy and sell product.

“If you’re a small independent grocer or a bodega or a mom-and-pop store with three to four or five outlets, you probably don’t have the bandwidth or infrastructure in place to be negotiating with Kraft on what they’re going to bring into your store,” Martin told Digital Commerce 360.

Another example is that a grocery company could have different store banners through which it sells, but they use different types of technologies, making it challenging to have a single point of entry to “that universe of retailers because they were all in different places,” he said.

As a result, he added, UNFI identified that developing a retail media network would create value for the grocery distributors and store operators it serves. In a sense, UNFI and those companies it served were “sitting on the sidelines as Walmart and Kroger and Amazon and Target were building their infrastructure for retail media.”

“Well, we wanted to make sure our customers had an ability to play in that space,” Martin said. “And not only did we think that internally, but a whole lot of our customers were coming to us and saying, ‘Help me think about this.’ We need to be able to compete and provide this to our consumers in our stores so that they have more tailored and differentiated shopping experiences — because we’re not going to beat Walmart on price, but we can offer a much better shopping experience, and this is a way to do that.”

How does a company develop a retail media network?

At first, Martin said, UNFI planned to build its retail media network capabilities in-house. And it began to do so.

But the distributor realized “really quickly” that developing such technology wasn’t its core capability. And its customers couldn’t wait for the time it would take UNFI to develop it, Martin explained. That led to UNFI meeting with technology providers figure out which retail media platform best matched its goals. Among those providers was Swiftly, which had the added benefit of having already been working with UNFI customers, Martin said, allowing the distributor to get references it felt were credible.

What is an example of a retail media network?

Retail media networks are a type of advertising platform where retailers can sell ad space on their own digital channels to third parties. Advertisers can target their ads using the retailer’s first-party data on customers, including information from loyalty programs. Then, advertisers can place ads on the retail media network provider’s websites, within mobile apps, or in stores via screens and displays. Those options provide an alternative to other targeting methods, such as those that rely on third-party cookies.

The on-site — or on-platform — component allows retailers advertising through the UNFI Media Network to “create a tailored shopping platform” via desktop and mobile.

In UNFI’s case, it’s not limited to UNFI-owned channels, Martin told Digital Commerce 360. Its retailer and supplier partners will be able to advertise off-platform in, for example, the Wall Street Journal as well as on Facebook and other social media platforms, Martin said. What differentiates it from other digital marketing is that they are targeting not just generic consumers from a marketplace or area. Instead, they can target individuals who they know are members of a loyalty program within UNFI’s system.

Based on that, he said, advertisers can “understand with a closed loop” if consumers convert from looking at a product via retail media advertising and then going to a UNFI-affiliated store or supplier website or app.

How does it work?

Retail media networks can work in different ways. For the UNFI Media Network, one way is through suppliers and brands couponing digitally. Another is being part of a retailer’s loyalty program.

Whereas some companies feel they’re devaluing their brand’s equity through couponing, Martin said, there are workarounds that still benefit both the advertising brand and the consumer. One example is that a brand can opt to donate a certain amount of points to a grocery store’s loyalty program if a consumer purchases the brand’s product. The consumer then accumulates points from that purchase that can eventually convert to dollars they can spend on groceries.

“But you did it through a series of transactions,” Martin said. “You didn’t do it because Heinz ketchup happened to be cheap that week, and so there’s a lot of interesting ways to reinforce that loyalty and that activation.”

Grocers and brands selling in UNFI Media Network-affiliated stores can also use in-store digital advertising. For example, some grocery stores might use digital screens on the doors in their refrigerated and frozen sections, highlighting specific products or displaying video advertisements.

It then becomes “plug and play based on what the retailer wants and prioritizes,” Martin said.

That could mean ads prioritizing categories, a retail banner, a loyalty program or in-store activity.

First-party data and user privacy

All this factors into the personalized advertising UNFI Media Network displays. But it’s also based on consumers’ shopping activity.

“What you’re going to see and what gets promoted to you is going to be very much tailored to meet those buying patterns and to help reinforce what you’ve already demonstrated are your preferences or your priorities as a consumer,” Martin said. “And more importantly, through our network, not only are you tailoring it, but one of the things that we thought was so important about Swiftly versus other retail media platforms out there is that the retailer retains 100% control of the information and data of that shopper, of that loyalty subscriber. They don’t have to give that away.”

Other retail media platforms, Martin said, declining to name them, will give companies access to the technology in exchange for user data. Those platforms, he said, are “interested in then using that data to create last-mile delivery connectivity.”

“Well, we’re not in the last-mile business,” Martin said. “We’re in the [business of] helping our shoppers, our business, our retailers grow their business in store. So we actually are able to deliver on the promise that you retain your shopper loyalty data. It is yours. It is private to you. We don’t need to see it to activate the programming that we have and we are able to provide the right ROAS [return on ad spend] analytic analytics to the suppliers without having to sacrifice that privacy either.”

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Retailers, among other advertisers, had already been exploring how third-party cookies’ elimination would alter targeting capabilities based on activity in Google’s Chrome web browser. That journey has opened up new opportunities for alternatives. Examples include those offered through retail media networks that leverage first-party data on customers.

In a July 22 blog post, however, Anthony Chavez, a vice president working on Google’s Privacy Sandbox initiative, explained that his company is changing course.

Google’s decision to cancel third-party cookies deprecation

“Instead of deprecating third-party cookies, we would introduce a new experience in Chrome that lets people make an informed choice that applies across their web browsing, and they’d be able to adjust that choice at any time,” Chavez wrote. “We’re discussing this new path with regulators, and will engage with the industry as we roll this out.”

Google originally started its Privacy Sandbox project to explore options for user privacy on the open web. Up until this week, that vision did not include third-party cookies, the code used on websites that can live on in web browsers across multiple site visits to track user activity and inform targeted advertisements delivered to those users. Along the way, the Privacy Sandbox team has been working with industry and government representatives to craft new solutions.

“Throughout this process, we’ve received feedback from a wide variety of stakeholders, including regulators like the UK’s Competition and Markets Authority (CMA) and Information Commissioner’s Office (ICO), publishers, web developers and standards groups, civil society, and participants in the advertising industry,” Chavez said. “This feedback has helped us craft solutions that aim to support a competitive and thriving marketplace that works for publishers and advertisers, and encourage the adoption of privacy-enhancing technologies.”

Timeline for third-party cookies deprecation

Ultimately, Google decided that its favored path will mean implementing these new settings within Chrome and without pushing ahead with cookies deprecation. That process began after a formal announcement in 2020, eyeing 2022 for full deprecation. In April, the deadline was moved into 2025 as Google acknowledged the CMA’s need to review proposals, as well as “ongoing challenges related to reconciling divergent feedback from the industry, regulators and developers.”

“As this moves forward, it remains important for developers to have privacy-preserving alternatives,” Chavez stated this week. “We’ll continue to make the Privacy Sandbox APIs available and invest in them to further improve privacy and utility. We also intend to offer additional privacy controls, so we plan to introduce IP Protection into Chrome’s Incognito mode.”

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Analysis and Rankings of the Top 1000 Online Retailers

Digital Commerce 360’s Top 1000 Report is the ultimate guide for retailers, and technology providers of ALL sizes to drive growth online

Here’s a sample of the Food & Beverage category data:

Here’s a sample from the report:

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In her role, Wilson will oversee Lowe’s retail media network, which is branded as the One Roof Media Network.

Lowe’s ranks No. 11 in the Top 1000, Digital Commerce 360’s database of North America’s online retailers by web sales. The retailer is in the Hardware & Home Improvement category.

Jennifer Wilson’s duties as Lowe’s chief marketing officer

Jennifer Wilson, senior vice president, chief marketing officer at Lowe’s | Image credit: Lowe’s

“Jen’s extensive marketing, merchandising and home improvement experience positions her well for this expanded role,” said Marvin Ellison, chairman and CEO at Lowe’s, in a statement released June 11. “She’s consistently moving Lowe’s forward, as recently demonstrated by the successful launch of our MyLowe’s Rewards loyalty program and Lowe’s retail media network.”

Wilson’s promotion was made effective as of June 10. She will report to Bill Boltz, executive vice president of merchandising at Lowe’s, according to details the retailer released.

She will take the lead at Lowe’s One Roof Media Network in a year when other competitors, including Home Depot and Walmart, are also building out their retail media capabilities. In March, Google announced Lowe’s as the first beta partner for its own off-site retail media solution. That beta program will leverage Google’s Search Ads 360 product for offsite retail media campaigns, thus extending the reach of networks — like the one Lowe’s operates — to additional third-party channels.

In addition, Wilson will work on strategic brand and product marketing, as well as growing a customer experience integration organization within Lowe’s.

“Jen brings a data-driven approach and is helping us develop a deeper understanding of the customer,” Ellison said.

Wilson’s background in marketing and at Lowe’s

Wilson’s most recent title at Lowe’s was senior vice president, enterprise brand and marketing. Before that, she served in vice president positions, with portfolios including integrated marketing, merchandising and paint. Prior to Lowe’s, she also worked in marketing and advertising for agencies including Luquire George Andrews, St. John & Partners and Akhia.

“I am humbled and excited for the opportunity to continue elevating this great brand by leading a talented team of people who are customer and data obsessed,” Wilson said. “Working together with the exceptional talent across the business, our goal is to continue to unlock value for our customers while delivering business results for Lowe’s.”

Currently, she also holds a board of directors seat on the Ad Council.

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Cookies have long been an essential piece of online advertising, mainly because they track a consumer’s activity across the internet so advertisers can serve them relevant ads. They power what the research firm eMarketer estimated would be a $600 billion annual online advertising industry in 2023.

Now, Google is phasing them out after years of concerns over privacy. Meanwhile, cookies’ retirement has been repeatedly pushed back. Most recently, Google delayed its plans to enact the phaseout by the end of 2024 into early 2025 after restricting cookies for 1% of all Google Chrome users in January.

“We recognize that there are ongoing challenges related to reconciling divergent feedback from the industry, regulators and developers, and will continue to engage closely with the entire ecosystem,” the tech giant said in an April blog post. 

That gives retailers some more time to fine-tune their plans.

How do retailers use third-party cookies?

Cookies are a tool retailers use to reach consumers and show them relevant advertisements. They’re used to keep consumers logged in to a retailer’s website, identify them and serve them ads. 

For example, cookies allow a retailer’s website to maintain a consumer’s shopping cart if she closes and later reopens the website. Moreover, they allow advertisers to show ads related to products a consumer was already looking at. 

Google’s cookie deprecation refers to third-party cookies, the kind that are used to serve these curated ads.

Despite the long lead time for the phaseout, advertisers still lean on cookies. A 2023 Adobe survey of 2,667 marketing and customer experience leaders found that 75% rely heavily on cookies. 45% spend at least half their advertising budgets on cookie-based targeting.

Nevertheless, 51% of those surveyed also qualified cookies as a “necessary evil,” suggesting that they’re on the hunt for a better solution. Even so, 49% said they don’t have access to enough resources to rethink advertising strategy in a post-cookie world.

Retail media networks present an alternative strategy 

Retail media networks are shaping up to be part of the solution for some of the largest retailers. They are a type of advertising platform where retailers can sell ad space on their own digital channels to third parties. Advertisers can target their ads using the retailer’s first-party data on customers, including information from loyalty programs. Ads can be placed on retailers’ websites, within mobile apps or in stores via screens and displays.

They’re advantageous both as a way of targeting ads and as an additional revenue stream for retailers. 

Many retail media networks are explicitly courting retail advertisers with the threat of a cookieless future. 

“For Walmart Connect, Walmart DSP will provide a solution to huge challenges that brands and agencies teams will face with the cookie deprecation process,” Jonathan Fasano, head of product at Walmart Connect Mexico said in April.

Walmart Connect is Walmart’s retail media network.

“Brands will begin to seek media with vast amounts of consumer purchase data, and we already have it through Walmart Audiences, which will also enable us to understand new audiences and potential new buyers for different categories,” he continued.

Target’s Roundel retail media network has similar information on its website.

“When the cookie apocalypse hits, it will wipe out the current way the industry has built audiences and the performance measurement capabilities used to measure the effectiveness of those audiences,” the website says. “If you don’t have real database and identity resolution tools at the ready to build targeted audiences and measure closed-loop media performance, you will suddenly find yourself relying on pre-digital proxies and methods of measurement.”

It presents the solution of advertising to Target customers through Roundel.

Albertson’s, Macy’s, Best Buy, Home Depot and many others also have retail media networks.

Other strategies as third-party cookies are phased out

Advertisers have proposed other solutions for ad targeting after cookies are finally phased out.

For example, the advertising company Criteo suggests tracking consumers with alternative IDs as a replacement for third-party cookies. These are “browser-based technology which seeks to emulate the functionality of the third-party cookie in a privacy-safe way,” Criteo says.

Alternative IDs work in two ways. The first, deterministic IDs, are based on consumers’ personal information after obtaining their consent and using first-party data. Conversely, probabilistic IDs attempt to identify consumers without any first-party data using signals like IP address, device type and operating system.

Generative artificial intelligence (AI) may also play a role. Using zero- and first-party data to personalize experiences for consumers can be challenging and costly to scale up. Supplement retailer GNC is using generative AI to turn that data into “hyper-personalized” recommendations, former chief information officer Scott Saeger told Retail Touchpoints.

Data clean rooms are another approach touted by Amazon and Walmart. They allow two actors — for example Walmart and an advertiser — to share their first-party data for more insights and precise ad targeting. The benefit of data clean rooms is that they can maintain privacy on the original data set.

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“It’s an endless pit,” said Ahmed, who is also the CEO of textile company Artistic Denim Mills and founder of denim brand DL1961.

Orme shows users a feed of videos based on their interests, much like on TikTok and Instagram Reels. What’s different, though, is that each video displays at least one product users can buy, and they can do so before scrolling to another video.

Whereas influencers often get paid one-time fees, “there’s no ROI for us,” Ahmed said. “All the digital managers [were telling us,] ‘You have to invest!’ And we said enough is enough. We have to create a system which is an ecosystem for influencers, brands and the shoppers so that the CMOs and the owners can see where the money is going.”

He told Digital Commerce 360 that’s what led him to start Orme with co-founder Robert D’Loren. The social commerce marketplace went live in April 2024. D’Loren, who is also chairman and CEO of Xcel Brands Inc., described the marketplace as the intersection of shopping, entertainment and social media.

D’Loren said Orme intends to compete with TikTok Shop, for example, by taking a different approach to how users make money on the two marketplaces.

“Their models are based on ad dollars. … We’re not out to sell ad dollars,” D’Loren said. “We’re out to get 100 million people sharing and earning. It democratizes all of this.”

‘Flip the model’ by which influencers get paid

D’Loren cited data from consulting firm McKinsey & Co. saying that worldwide conversion rates from influencers are “at best 3%,” and conversion rates in affiliate marketing are less than 1%.

“Therein lies the problem,” D’Loren told Digital Commerce 360. “When you have such low conversion rates, and since the change in the privacy rules where you really can’t follow your customer around the internet anymore, digital marketing doesn’t quite work either. So customer acquisition cost has become prohibitively expensive. And there’s no solution for it. The only right solution would be to flip the model. Transition it from a pay-to-play model to a pay-for-performance model.”

As opposed to one-time fees, influencers who facilitate product sales on Orme can receive different percentages of those sales. If a user or influencer makes a video and shares it, then someone purchases directly from that video, the user receives 6% of the sale.

“Someone can pick up [that] content and share it on Instagram or any social network or platform,” D’Loren said. That user gets paid 2%. The person who shared it gets 6%. “That’s how this whole thing works.”

In other words, if 50 people share a creator’s video, and those 50 people each make at least one sale, the creator makes 2% of each product sold through her content, plus 6% on any sales made directly from her own video. The 50 users who shared the video then get 6% of each purchase made from their shared video.

Orme has launched with seven merchants and more than 1,000 users who downloaded the app in its first week without using any email campaigns, D’Loren said in a recent Xcel Brands earnings call with investors. Xcel Brands announced $2.3 million in net revenue for its fiscal fourth quarter ended Dec. 31, 2023. That’s a 44% decrease from its Q4 2022, down $1.8 million.

Xcel launched Orme as “a joint venture with a technology company in which Xcel owns a 30% interest in this new video and social commerce marketplace,” D’Loren told investors on the call.

How does Orme work?

Similar to TikTok and Instagram Reels, Orme users can swipe up within the app to view videos. Also, as on TikTok, there is a vertical list of buttons on the right side that allows users to click on a brand or user’s profile page. That page shows other videos the users or brands have made, as well as items they sell, saved recordings of shows they’ve produced, any live shows they’re hosting, and any upcoming events they have planned.

An Orme video from Longaberger, which manufactures and distributes houseware items, displays one of the brand’s wooden baskets.

The video above displays a basket from retail brand Longaberger. Xcel owns Longaberger, as well as other brands including Halston, Judith Ripka and more. Among the other options in the buttons on a video are a button to save a video, “like” it, add its products to one’s own store on Orme, and a “shop” button. A distinguishing factor between Orme and TikTok (and its in-app TikTok Shop) is that the video portion and ecommerce shop portion are not separated.

Clicking the “shop” button on the Longaberger video shows what products a user can purchase directly from that video page.

Users can then check out directly from the video page without being taken to a different part of the app or being redirected to an ecommerce website.

The checkout page on Orme slides up to temporarily cover the video a user is watching. Once a user completes her purchase, she can continue to scroll where she left off.

What happens to an order after checkout?

When a consumer completes a purchase on Orme, the app’s APIs (application programming interfaces) connect directly with the merchant, inserting the order into their system and triggering the merchant’s customer relationship management (CRM) system. In this case, that means an order placed on Orme for a Longaberger basket will appear in Longaberger’s ecommerce system. Longaberger is then responsible for sales tax, fulfillment and post-purchase communication.

“For all practical purposes, it’s their customer,” Ahmed said.

He added that these merchants don’t want to part with their customers.

And everything has to happen in real time, Ahmed said. That means Orme needs API connectivity to automatically update product information and changes to pricing, inventory, descriptions and imagery.

“And we did that without navigating the customer away from the video,” D’Loren said. “Most platforms take the customer away and they put them on the ecom site. That doesn’t happen on Orme. But the whole back end and the customer journey stays exactly the way it is with the vendor today. We didn’t want to disrupt that customer journey experience in any way, shape or form.”

How do users get paid on Orme?

Marketplaces sometimes hold a merchant’s money for up to 60 days, Ahmed said. TikTok says it initiates payout to sellers one to eight days after an order delivery date. It adds that “the exact number of days is determined based on your shipping performance.”

Orme pays its merchants their share of a sale immediately, splitting the payment at checkout, Ahmed said. Merchants like Longaberger get 75% of the total sale price, and 25% goes to Orme. From that 25%, the marketplace pays:

• Influencers it credits with getting the consumer to convert (the above-mentioned 2% and 6% referral rates).
• Credit card processing fees (Orme currently uses Stripe for this).
• The shoppers, who can choose to keep their referral earnings in their Orme account and use them like a cash-back system.

“That’s 10% they would have spent anyway,” D’Loren said. “So what are they really paying? 15%.”

TikTok announced it will take increase its fees to 8% this year on most items, from 2% plus $0.30 per sale, The Information first reported.

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The retailer will formally present the new interactive ad types at a presentation on May 14.

Amazon introduced ads to Prime Video, its streaming platform, in early 2024. For an extra $2.99 per month, Prime members can opt out of seeing ads. Amazon said Prime Video with ads has an average monthly reach of 200 million consumers. The retailer’s advertising business shows specific ads to consumers, targeted based on its trove of customer data.

“Amazon Ads continues to reimagine the streaming TV experience with interactive ad formats that are seamlessly shoppable and help advertisers meaningfully connect with customers,” said Alan Moss, vice president of global ad sales for Amazon Ads. “We are developing innovative experiences to help brands better engage with customers, as we work to transform streaming advertising through our differentiated combination of reach, first-party signals, and ad tech.”

Other streaming companies have also introduced shoppable ads recently. Amazon’s statement puts the new ad formats in direct competition with others, saying, “These formats go far beyond QR codes, making it easier for viewers to connect with brands while enjoying the premium streaming entertainment content they love.”

Amazon ranks No. 1 in the Top 1000, Digital Commerce 360’s ranking of the largest North American online retailers. It is also No. 3 in Digital Commerce 360’s Global Online Marketplaces Database, which ranks the 100 largest such marketplaces by third-party GMV.

Amazon’s new ads on Prime Video

It shared three new formats advertisers can purchase on Prime Video. 

1. Shoppable carousel ads: Retailers can present their products as a lineup that customers can browse through during commercial breaks and add to their carts using the remote. The advertisement automatically pauses when a consumer interacts with it and restarts once the interaction is over.
2. Interactive pause ads: Translucent ads will appear on screen when viewers pause a show or movie. The imagery will include “add to cart” and “learn more” buttons. These advertisements can extend engagement over a traditional ad break because they remain on the screen as long as the video is paused, Amazon said.
3. Interactive brand trivia ads: Amazon said these advertisements give consumers a chance to shop while being entertained with trivia about the brand. They can also be used to teach consumers about products and services and give out rewards, like Amazon credits with eligible purchases. 

Amazon said that interactive ads are more valuable for advertisers based on a study it conducted. In the study, advertisers ran both interactive ads like those mentioned above and non-interactive ads. The interactive versions drove higher conversion and 10 times higher product page views than the alternative. 

The growth of shoppable video 

Shoppable ads are a growing ecommerce option for some of the largest online retailers. It’s not Amazon’s first foray into the area, either. It tested shoppable ads during the first-ever Black Friday NFL game it streamed in 2023.

Meanwhile, competing streamers are also incorporating the advertising option. In January 2024, Disney announced a beta program on Hulu. Consumers can make purchases through the new Gateway Shop in Hulu while maintaining their viewing experience, Disney said at the time. 

Viewers see personalized advertisements for products that are sent to phones through push notifications or email. Since the launch, Disney has grown the interactive shopping features in streaming, it said.

“Our goal is to help audiences connect with the brands they love with the least amount of friction, without disrupting the content they’re streaming,” Jamie Power, senior vice president of addressable sales at Disney Advertising, said in January.  

Disney is No. 92 in the Top 1000. Walmart (No. 2) and Home Depot (No. 4) are also experimenting with shoppable TV. Walmart inked a deal with NBCUniversal in November to place shoppable ads on the streaming platform Peacock. The ads gave consumers the chance to buy Walmart items featured in select Bravo shows. And Home Depot released a branded-content series with Vizio in 2023.

Most recently, TelevisaUnivision announced a partnership with Shopsense AI to integrate shopping across its streaming channels. It launched four shoppable collections along with the Latin American Music Awards.

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The agreement means that Kroger Precision Marketing will allow Yahoo DSP advertisers to place ads in front of Kroger’s audience. The retail media platform is powered by Kroger’s first-party and purchase-based data.

Kroger ranks No. 6 in the Top 1000, Digital Commerce 360’s database of North America’s leading retailers by online sales. Kroger is also first in the Top 1000’s Food/Beverage category.

Why Kroger’s first-party data is important to Yahoo

“Using first-party data is crucial to future-proof against third-party cookie deprecation, and applying Kroger’s retail data will help to ensure addressability for our advertisers,” said Elizabeth Herbst-Brady, chief revenue officer at Yahoo. “This new offering not only reinforces our privacy-safe approach, but also demonstrates our commitment to interoperability and allows advertisers to activate high-quality data across campaigns through the Yahoo DSP.”

The first-party consumer data that retail media networks use has gained interest as Google prepares for third-party cookie deprecation. The search giant plans to implement full deprecation on Chrome in early 2025. Other browsers have taken steps to block third-party cookies as well, limiting their utility in tracking users across different websites and activities.

Access to Kroger Precision Marketing, which the grocer operates with the retail media company 84.51°, will leverage Kroger’s customer data. In addition, in cases where advertisers use both Kroger and Yahoo’s platforms, they will be able to attribute store sales at Kroger locations based on media exposures from the Yahoo DSP.

Leveraging retail media network strengths

“Advertisers on average see 6.5x higher return on ad spend when using our precision audiences,” said Cara Pratt, senior vice president of Kroger Precision Marketing. “By expanding our availability through the Yahoo DSP, we’re delivering even more meaningful messages and measurable brand impact.”

That impact is something that many other retailers are currently pursuing. Their motivation stems in part from Google Chrome’s forthcoming third-party cookies deprecation.

Albertsons, Walmart, Macy’s and others have all announced major retail media network updates, launches, and partnerships in 2024. The networks bring in revenue, in addition to driving sales of products that advertisers are already selling through the networks’ owners.

Kroger Precision Marketing, which debuted in 2017, already offers self-service advertising for digital contexts. It also sells managed-service advertising in work with publishers, as well as programmatic advertising.

Kroger previously announced plans to let advertisers from another DSP, The Trade Desk, reach Precision Marketing audiences in 2023.

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“The first quarter ended on an upswing,” said Niraj Shah, Wayfair CEO, co-founder and co-chairman. “Our revenue was down just under 2% year over year for Q1, which marks our sixth straight quarter of share gain. Shoppers are increasingly choosing Wayfair, with year-over-year active customer growth once again positive and accelerating compared to last quarter.” 

Wayfair ranks No. 10 in the Top 1000, Digital Commerce 360’s ranking of the largest online retailers in North America. Digital Commerce 360 categorizes it as a Houseware & Home Furnishing retailer.

Wayfair Q1 revenue and other results

U.S. net revenue slightly outperformed total revenue, declining 1.0%. It continued to make up the bulk of revenue, accounting for $2.4 billion of the $2.7 billion total revenue. Meanwhile, international revenue declined 5.8% to $338 million. That was on top of declining in each quarter of 2023.

The retailer recorded a net loss of $248 million for Q1. That was an improvement over the net loss of $355 million in the year-ago period. 

Wayfair cited some promising data about customer behavior in the quarter. Active customer count increased 2.8% year over year to 22.3 million at the end of March. Orders per customer also grew slightly, to 1.84 from 1.81 in Q1 2023. Repeat customers placed 7.7 million orders in Q1, an increase of 1.3% year over year. Those were 80.5% of total orders.

However, total orders delivered in the quarter fell 1.0% to 9.6 million. Average order value also fell slightly, from $287 to $285.

Wayfair’s brand refresh

Wayfair is in the midst of a brand refresh, the retailer told investors in a May 2 earnings call.  

“This is the most substantial evolution to our brand strategy, creative expression, and marketing presence since 2018,” Shah said.

“Our logo has become the foundational brand element that defines our entirely new storytelling platform, the Wayborhood,” Shah said of the campaign.

The advertisements feature influencers and celebrities including Shawn Johnson, Kelly Clarkson and Lisa Vanderpump. Shah said the goal is for these ads to become as well-known and synonymous with Wayfair as the gecko is to insurance company Geico. 

As part of the brand refresh, Wayfair will also open its first retail store later in May. The 150,000-square-foot store will be located in a Chicago suburb, Wayfair said. The store is an experiment, Shah said, to see what works before scaling up.

“We don’t necessarily expect that you get that right out [of] the gate. You probably have to iterate some. And so, that’s why we’re not opening 20 stores at once,” he said.

Suppliers introduce new products

Wayfair said that the state of supplier relationships is in a good place compared to recent years.

“For the first time since pre-pandemic, we’re seeing suppliers introducing large groups of new products into their catalogs as they look to build momentum for the next stage of growth,” Shah said. “Across the board, we’re hearing their enthusiasm to partner with Wayfair and substantial interest to lean in behind our entire offering — joining our curated brands, being featured in our promotional events, leveraging our fulfillment solutions, taking advantage of supplier advertising, and having shelf space in our stores.” 

Wayfair has grown its number of suppliers and diversified where it sources products from. That can help mitigate challenges from tariffs or other economic factors, it said.

Wayfair results

For the first quarter ended March 31, Wayfair reported:

• Total net revenue declined 1.6% to $2.7 billion.
• Net loss was $248 million.
• Active customers increased 2.8% to 22.3 million.

Percentage changes may not align exactly with dollar figures due to rounding.

Check back for more earnings reports. Here’s last quarter’s Wayfair update.

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