Macy’s reported quarterly earnings Wednesday, and they were not as bad as expected. The department store is attempting a turnaround after years of flagging sales — closing more than a hundred stores and updating hundreds of others. Macys offered an optimistic sales forecast for the rest of the year, though it said tariffs are expected to eat into margins.

It’s also trying to grow a part of the business that’s immune to tariffs: selling ads on its website. It’s a practice that’s become increasingly important for many retailers as they attempt to imitate Amazon’s success. Now Macy’s is partnering up with the e-commerce giant to do just that.

Macy’s has been selling digital ads since 2020. That can take the form of sponsored search results, after-purchase offers, or traditional banner displays.

Of course, no one has done this kind of thing longer or bigger than Amazon. So Macy’s has announced it’s partnering with Amazon to sell ads for it.

“They've really developed a huge suite of Amazon advertising tools that are much more sophisticated than many others,” said Brad Jashinksy, an analyst at Gartner.

Amazon launched its third-party ad service in January and Macy’s is the biggest brand yet to sign on. The e-commerce giant’s scale presents benefits but also risks for retailers.

“It seems a bit counterintuitive,” said Tim Hanlon at Vertere Group.

That’s because it means sharing sales data with a potential competitor. But as more retailers jump into the ad business, attracting ad buyers has gotten harder.

“The problem is they're all acting in their own vacuums, their own silos, and a brand is now challenged to figure out ‘Jeez, how do I advertise in all of those retail environments?’” said Hanlon.

Many brands already advertise through Amazon’s platform, since it’s the third biggest in the U.S. after Google and Meta. So consolidating ad buys for multiple retailers could be a new way for Amazon to dominate.

“This is a well-worn strategy for Amazon to try to become the enabler for entire industries,” said Andrew Lipsman, an independent analyst for Media Ads and Commerce.

Sometimes, Lipsman said, it works great — like Amazon Web Services. Other times it’s been a bust, like the attempt to license in-store touchless payment systems, which never really caught on.