From snack ads printed in the aisles of your local grocery store to digital banners spanning the top of your Amazon search, retail media—or advertising that reaches consumers at or near the point of sale—has rapidly evolved and exploded in recent years.
Today, it’s one of the most powerful means of digital advertising. In a survey from Skai and the Path-to-Purchase Institute, 77% of respondents said retail media drove good or excellent results for their business in 2023.
The industry continues to grow—with forecasts to reach nearly $60 billion in 2024—as retailers become media owners and sellers, launching retail media networks (RMNs) to utilize their e-retail environments as space for digital ads. As the number of RMNs in the market expands, brands will face the challenge and opportunity to become more discerning and strategic about which ones they choose to advertise on.
Understanding retail media networks
Amazon pioneered the RMN in 2012, launching a digital advertising infrastructure made up of various channels to help brands sell within its retail ecosystem and reach shoppers at every stage of the buying journey.
While the e-commerce giant’s RMN still reigns supreme today, the explosive growth of the retail media market has made this advertising avenue expand far beyond Amazon. Today, you can purchase retail media from more than 200 retailers across categories, from Walmart to Instacart and beyond.
Owners of RMNs include:
- Mass merchandisers (e.g. Costco)
- Marketplaces (e.g eBay or Allegro)
- Grocery (e.g Kroger or Albertsons)
- Category specialists (e.g Home Depot or Ulta)
- Department stores (e.g. Nordstrom or Macy’s)
- Delivery platforms (e.g Gopuff or Doordash)
While the largest RMNs today are US-based, including Amazon and Walmart, regional and local networks exist around the world.
So, what exactly are the benefits of these networks?
First, they make it possible for you to present consumers with relevant product options while they’re searching, putting personalized messages in front of shoppers already in the mindset to make a purchase. But perhaps even more valuable, especially with the decline of third-party cookies, is the first-party data available within these networks.
RMNs collect real-time, in-depth insights about audience shopping behaviors and buying decisions. Because ad impressions and sales all take place within the RMN, the impact of ads on conversion can be more directly tracked. You can then leverage this data to strategize sophisticated, targeted, and effective campaigns, closing the loop between advertising and sales.
Especially for brands that don’t or aren’t able to collect or use their own first-party data, a relationship with an RMN can be critical in the increasingly private online ecosystem.
Finding the right retail media network
The retail media landscape today consists of hundreds of platforms, software solutions, marketplaces, and stand-alone retailers. Every other day, another retailer jumps on the retail media train and opens its data and assets for advertising.
With so many options spanning various geographies, it can feel overwhelming to narrow down which retail media network (or networks) is right for your brand. DEPT®’s retail media team can help you identify your most relevant retailers, taking the guesswork and complexity off your plate.
When you think about finding your RMN sweet spot, look at three categories:
01 – Retailers/solutions that you are already selling through
02 – Retailers/solutions that offer growth potential (although you might not yet sell through them)
03 – Retailers/solutions that offer advertising opportunities aligned with additional sub-objectives (e.g., winning new customers in a specific market segment or location)
In general, we recommend the top two or three marketplaces or retail partners in your local market (including regional or global marketplace players present) to keep things manageable. This typically leads to one or two regional/global players and one or two additional marketplaces per local market.
For instance, consider a US-based home improvement brand that currently sells its products on Amazon and online at Home Depot. Its mix might include those two RMNs (a generalist and a specialist, respectively) and Walmart if the brand is looking to sell its products there in the future.
In general, we recommend one to two regional/global players and one to two additional marketplaces per local market — a total of no more than four RMNs.
Considerations for selecting an RMN
Not all retail media networks are the same, from varying audience reach, ad formats, tracking capabilities, and more.
When determining if advertising on a certain network is the right move for your brand, consider the following:
- Will this network be effective in helping you achieve your specific goals?
- Does this network reach your target audience? What are its targeting capabilities?
- What types of advertising does the network offer, and where? (On-site, partner sites, in-store, etc.)
- How does the network track data, and how transparent are the reporting and insights?
- Does the network integrate with your current tech stack and data architecture?
- Is the channel’s measurement standardized with others you are currently using?
RMNs for non-endemic brands
Amazon is typically a safe bet for most non-endemic advertisers, as its vast audience encompasses hundreds of millions of active users browsing various product categories.
It allows you to target ads to users actively searching for related products or displaying interest in similar categories. For example, a pet insurance brand could advertise to users searching for puppy supplies. Its performance-based pricing model ensures you only pay for measurable results, such as clicks or sales generated.
For non-endemic brands looking to expand beyond Amazon, larger RMNs typically offer the most value, drawing in broader audiences and collecting more robust data. However, as the retail media landscape differs by region, selecting RMN partners should be specific to each area in which you want to advertise.
What to expect from retail media in the next few years
In the coming years, the retail media landscape will continue to become increasingly complex. As more retailers launch their own advertising solutions and media networks, you will face an even more vast and crowded landscape.
With more retail media offerings comes the potential to reach more niche and relevant audiences. You will have to continually reevaluate the balance between generalist and specialist retailers within your RMN mix.
While more platforms mean the potential for even less standardization in measurement and reporting, harmony initiatives and market aggregators (like agencies and digital associations) will continue to progress. Still, it remains to be seen how the major players behave in this and if and when common standards will be introduced.
As retail media remains an effective advertising channel, more players enter the network market, and AI technology accelerates and improves targeting and tracking, one thing is clear: Retail media will continue to grow and become an essential part of your brand’s advertising budget.
