Broadcasters and brands are increasingly leveraging ad-funded entertainment (AFE) partnerships to reach fragmented audiences and bypass traditional budget constraints. Recent industry examples, such as ITV's collaboration with M&S and Expedia's shoppable OTT platform, illustrate how branded content can drive direct commercial outcomes while providing new IP funding sources for producers.
The success of ITV and M&S signals a transition for broadcasters from passive ad-inventory sellers to active commercial partners. By integrating retail data and shoppable technology, streamers are creating direct-to-commerce loops that traditional linear advertising cannot replicate. This shift addresses the dual pressure of shrinking production budgets and audience fragmentation, allowing brands to act as publishers while broadcasters secure high-quality IP. In a B2B context, the ecosystem is moving toward a model where content success is measured by conversion metrics rather than just reach. Watch for ITV’s digital advertising revenue growth, which climbed 12% in 2025, as a benchmark for the scaling of these integrated AFE models.
The expansion of ad-funded entertainment (AFE) coincides with a broader push by broadcasters to diversify revenue as linear advertising faces sustained pressure. Per Enders Analysis in March 2026, ITV’s traditional advertising revenue fell 5% in 2025, even as its digital and studio divisions grew. To counter this, ITV has executed a 'More Than TV' strategy, which successfully resulted in two-thirds of total group revenue now originating from its Studios and digital Media & Entertainment units. This structural shift is also driving consolidation rumors, with Comcast-owned Sky reportedly engaging in preliminary discussions to acquire ITV’s broadcast and streaming operations, according to November 2025 reports.
Meanwhile, the shoppable technology landscape is maturing rapidly to support these content-to-commerce integrations. Per Expedia Group reports from late 2025, the company launched a dedicated 'Set-Jetting' travel hub to capitalize on the fact that 53% of global travelers now claim their vacation plans are influenced by on-screen content. This mirrors M&S’s strategy of distributing over 1.8 million recipe cards in-store to link Cooking with the Stars directly to physical retail footfall. Per PwC’s 2026 outlook, AI-powered hyper-personalization in advertising is expected to be a primary growth engine for the media sector, potentially driving global ad revenues to $1.4 trillion by 2030.
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