Retail media has emerged as the fastest-growing advertising channel in digital marketing. Retailers including Amazon, Walmart, Target, and Kroger have built sophisticated advertising platforms that allow brands to reach consumers at the point of purchase. The appeal is straightforward: retail media connects ad exposure to actual sales data, closing the attribution loop that has frustrated advertisers for decades.
What Is a Retail Media Network?
A retail media network (RMN) is an advertising platform built and operated by a retailer. It allows brands, including both products sold by the retailer and external advertisers, to purchase ad placements across the retailer's owned properties. These properties include the retailer's website, mobile app, in-store digital displays, and increasingly, off-site channels where the retailer's data is used to target ads on the open web.
The concept is not new. Retailers have sold shelf placement and end-cap displays for decades. What has changed is the digitization of these opportunities and the data that powers them. Retail media networks combine point-of-sale transaction data with digital advertising technology to create a closed-loop system where brands can target shoppers based on purchase behavior and measure the sales impact of their campaigns.
Why Retail Media Is Growing So Fast
Retail media ad spending in the United States surpassed $60 billion in 2025, and projections suggest it will continue growing at double-digit rates. Several factors explain this acceleration:
First-Party Purchase Data
Retailers possess what many consider the most valuable data asset in advertising: deterministic purchase data at the individual or household level. While other advertising channels rely on proxies such as clicks, site visits, or modeled conversions, retail media can directly connect ad impressions to transactions. In a world where third-party tracking is eroding, this data advantage is only becoming more valuable.
High Purchase Intent
Consumers browsing a retailer's website or app are typically further along the purchase funnel than those reading news articles or scrolling social media. This inherent purchase intent translates to higher conversion rates and more efficient return on ad spend.
Closed-Loop Attribution
Because retailers control both the advertising platform and the point of sale, they can offer deterministic attribution that directly ties ad exposure to purchases. This eliminates the modeling and inference that characterize attribution in other digital channels.
Major Retail Media Networks
Amazon Advertising
Amazon dominates the retail media landscape with an estimated 75 percent market share. Its advertising business generated over $50 billion in annual revenue in 2025, making it the third-largest digital advertising platform globally behind Google and Meta. Amazon's ad offerings include sponsored product listings in search results, display ads across its properties, video ads on Prime Video and Freevee, and its demand-side platform (Amazon DSP) for programmatic buying across Amazon-owned properties and the open web.
Amazon's advantage lies in the depth and recency of its purchase data, its massive consumer reach, and the integration of advertising into the shopping experience. Sponsored products, which appear in search results on Amazon.com, remain the highest-performing ad format by conversion rate.
Walmart Connect
Walmart Connect is the second-largest retail media network in the United States. Walmart's advertising platform benefits from the retailer's enormous physical footprint: over 4,700 U.S. stores visited by roughly 150 million customers weekly. Walmart Connect offers sponsored search, display advertising on Walmart.com, in-store advertising through TV walls and self-checkout screens, and off-site programmatic targeting powered by Walmart's purchase data through its partnership with The Trade Desk.
Walmart's omnichannel advantage, the ability to connect online ad exposure to in-store purchases, is a significant differentiator. For CPG brands whose products are sold primarily in physical stores, this capability is particularly valuable.
Other Notable Networks
The retail media landscape extends well beyond Amazon and Walmart:
- Target (Roundel): Leverages Target's first-party data and loyalty program for on-site and off-site advertising
- Kroger Precision Marketing: Offers powerful CPG advertising backed by grocery purchase data from 60 million loyalty card households
- Instacart Ads: Connects brands to consumers at the moment of grocery ordering across multiple retailer partners
- Best Buy Ads: Focuses on electronics and technology brands with purchase data from online and in-store transactions
- Uber Advertising: An emerging commerce media platform leveraging ride-hailing and delivery data
On-Site vs. Off-Site Retail Media
Retail media has expanded beyond the retailer's own properties into two distinct categories:
On-Site Media
Ads displayed on the retailer's own website and app. These include sponsored product listings, banner ads, and featured placements. On-site media captures consumers in a shopping mindset and offers the most direct path from ad impression to purchase.
Off-Site Media
Ads served across the open web, social platforms, and CTV that use the retailer's purchase data for targeting. The retailer's DSP or data partnerships enable brands to reach the retailer's customers outside of the retailer's owned channels. Off-site retail media extends reach and allows brands to influence consumers earlier in the purchase journey.
Off-site retail media is the faster-growing segment, as retailers recognize they can monetize their data assets beyond their own properties. However, it also introduces questions about data governance, consumer consent, and the potential for data leakage.
Challenges and Considerations
Despite its growth, retail media faces several challenges:
- Measurement standardization: Each retailer defines metrics differently, making it difficult for brands to compare performance across networks. The IAB has published retail media measurement guidelines, but adoption is uneven.
- Incrementality: Brands question whether retail media ads drive genuinely incremental sales or simply capture transactions that would have happened anyway. Retailers are investing in incrementality testing tools to address this concern.
- Pay-to-play dynamics: As retail media becomes essential for product visibility, some brands worry about a "tax" on shelf space where advertising spend becomes a prerequisite for distribution rather than a growth lever.
- Fragmentation: Managing campaigns across dozens of retail media networks requires significant operational overhead. Agency holding companies and retail media aggregation platforms are emerging to help brands manage this complexity.
The Future of Retail Media
Retail media is evolving in several directions. In-store digitization is bringing programmatic ad buying to physical retail environments through digital screens, electronic shelf labels, and smart carts. Clean room technology is enabling data collaboration between retailers and brands while preserving privacy. And the concept is expanding beyond traditional retail to include commerce media more broadly, with travel companies, financial institutions, and food delivery platforms all building advertising businesses powered by their transaction data. For brands that sell through retail channels, retail media is no longer optional; it is an essential component of the media mix.
