Retail media has long been a staple for consumer brands, but generally in a brick-and-mortar setting. Businesses paid for space to set up brand displays, like endcaps on aisles, in-store signage, and other promotional materials. Contrary to advertising strategies intended to lure in customers at the beginning of the sales funnel, retail media attempts to target buyers as close to the end of the buyer experience as possible. Rather than enticing consumers with the promise of a product later, they’re introduced to a product in the moment and encouraged to make a purchase.

Today, a significant amount of shopping takes place online, which has forced advertisers to adapt, and that includes the world of retail media. Without physical aisles and storefronts in which to market, brands are now working within a digital landscape, taking steps like embedding ads on e-commerce pages for products related to consumer searches. The shift from in-store to online has changed many things about how brands do business, and retail media is just another step in mastering digital advertising.

Why Is Retail Media Becoming More Popular?

Retail media has long been a secondary strategy for brands moving into the e-commerce advertising space, but today, the tables are turning much faster than anticipated. Why?

In short, the pandemic. COVID-19 has changed modern life on an incredible scale, and likely far beyond the signs visible today. In response to apprehension about spending time in public, more people than ever are shopping online, bypassing big box stores in favor of virtual shopping carts. In fact, groceries – a historically underperforming area of e-commerce – made up 12% of all online sales in 2020.

The numbers tell the tale better than words can: from 2020 to 2021, online shopping grew by 18%. Similar growth in retail media is expected to follow; spending today is just $20 billion, but that number is expected to expand to $50 billion within five years.

The shift away from third-party cookies is a factor as well. Since advertisers are more reliant on first-party consumer data, they’re able to benefit from targeting opportunities to drive sales. By relying on how users are interacting with a website, advertisers can feed information most likely to guarantee a conversion.

The Evolution in the Digital Era

Retail media isn’t new; it’s just taken on a different form. Prior to the rise in e-commerce, retail media was limited to things like flyers, print media, and in-store displays. Today, these tactics still exist in stores, but social media ads, email marketing, and on-site advertising create digital-first retail media networks.

What Is a Retail Media Advertising Network?

The concept behind a retail media advertising network is simple: the collection of ad placement avenues available on a digital platform, like a website or app. This encompasses advertising real estate across key pages, like a home page, search page, and category pages, to include all elements of the buyer journey.

How businesses approach a network will vary based on advertising objectives, but a well-developed strategy is a key part of success.

What Are the Different Retail Media Advertising Channels?

Retail media in the digital age goes beyond a single avenue, giving advertisers more flexibility to work with. The most popular options include:

  • E-commerce Platforms: E-commerce platforms, like retailer websites and shopping apps, are a key opportunity for retail media. For most advertisers, this is the first resource utilized.
  • Social Media Ads: A strong paid social media strategy, can cater to users at all stages in the marketing funnel, allowing retailers to acquire customers faster. According to Global Index Web, 24% of internet users clicked on a sponsored post in February 2021 and this figure is set to increase. Therefore, the retail media industry can benefit and increase online and in-store sales through the use of paid social.
  • Streaming Services: While some consumers are willing to pay a premium for streaming services, others are willing to accept lower costs in exchange for limited advertisements. This makes connecting products and programming a great opportunity.
  • Over-the-Top (OTT) Units: In a way similar to streaming services, OTT options, like Amazon Fire Sticks and Roku boxes can also include advertising in limited quantities without driving users away.
  • Connected TV (CTV): Also known as smart TVs, CTV options, including Roku TVs, provide an opportunity for advertising as well with the ability to target younger users who have pivoted from traditional broadcast avenues.

What Are the Benefits of Retail Media?

Retail media offers big benefits to both brands and retailers. For brands, conversion tracking is improved, visibility is increased, and first-party customer data is more accessible. All of these elements drive sales and improve advertising targeting over time.

For retailers, retail media provides an additional revenue stream and increases e-commerce profitability. By making sure advertisements are in the right place at the right time, customers are more likely to make purchases. In addition, strategically-placed ads can improve the purchase experience, driving revenue as well as customer loyalty.

What Are the Main Challenges for Retail Media?

Retail media, as with all advertising opportunities, isn’t without its challenges. These include:

  • Consumer Privacy: Privacy is a priority for consumers, but so is a personalized experience. While evolving retail media opportunities, brands will need to be taking active steps to safeguard customer information while still delivering an enjoyable approach to shopping.
  • Collaboration: To make the most of retail media networks, brands and retailers will have to work together to find effective solutions for the sharing and managing of first-party data. In most cases, this will mean a new approach to collaboration that will take time to embrace.
  • Campaign Performance and Tracking: Measurement is always an issue with digital advertising, and it’s true here, too. To make the most of networks, brands and retailers alike will have to find a way to combine data sources for maximum efficiency.


The digital advertising landscape is always changing, and the prominence of retail media networks is just another step in the evolution. However, brands and retailers will both need to be cognizant of the evolving market, including changes post-pandemic. Regardless, the popularity of online shopping is unlikely to decline– the convenience is unparalleled – so there’s a lot to gain in embracing omnichannel opportunities to reach audiences.