Walmart amends adtech agreement with Trade Desk which might benefit Amazon

Adtech firm Trade Desk (NASDAQ:TTD) could be at risk of losing one of its most valuable clients, Walmart (NYSE:WMT). TTD shares were down nearly 6% before midday on Thursday.

According to a report by The Information, citing sources, the retail giant last year renegotiated its agreement with Trade Desk and now has the option to use ad-buying platforms of other firms.

Under the previous agreement, which lasted for four years, Trade Desk was the exclusive technology provider to advertisers buying spots on the Web using Walmart shopper data for targeting.

The report said the move might benefit direct rival Amazon (NASDAQ:AMZN), which has recently ramped up its efforts to handle the sale of ads across the web and has been offering advertisers incentives to woo them away from Trade Desk.

Sources told the tech news outlet that Trade Desk’s high fees frustrated Walmart, which led them to renegotiate the partnership.

According to the sources, Trade Desk charges Walmart’s advertisers in double digits to use the technology.

In comparison, Amazon charges advertisers only 1%, which was recently brought down from 5% and 7%.

A Trade Desk employee told The Info that Walmart jealously guards its shopping data to prevent it from falling into Amazon’s hands.

The employee said Trade Desk has built a separate version of its technology for Walmart on Microsoft Azure, albeit a large portion of its business runs on Amazon Web Services.

Another person familiar with Walmart’s thinking said the retailer could also potentially acquire an ad-buying platform or possibly build its own ad-buying platform from scratch.