Few media developments have garnered as much attention as retail media networks (RMNs) over the past few years. They’ve been described as the third wave of digital advertising (after search and social media), the Holy Grail of advertising, and the future of all media. Retail media presents advertisers with an enticing offer—to better connect with their consumers using robust first-party data.
The offer is an appealing one that marketers are choosing to invest in. According to eMarketer, retail media spending will reach $60 billion in the U.S. this year and $100 billion by 2028. Despite current economic uncertainty and difficult market conditions, retail media in the U.S. is expected to grow 20% in 2025, compared to 4.3% for the total ad market and 3.7% (at most) for retail sales. In our 2025 Annual Marketing Report, we asked global marketers about their plans for the next 12 months, and 65% of marketers said that RMNs would play a bigger part in their media mix. Only 2% are planning to pull in the reins. Clearly, retail media is on everyone’s mind.
But everyone sees something different in it, it turns out.
Who is driving retail media trends?
While globally 65% of marketers believe that RMNs will play an increasing role in their media mix this year, that figure varies by region. North American marketers lead the way, with 74% saying that RMNs were more important than last year, up from 64% in 2024. Marketers in Latin America and the Asia-Pacific region aren’t far behind at 69% and 68%, respectively. While the Asia-Pacific region did see a decline from last year in those planning increases, a greater percentage planned to keep their retail media spending the same as last year. Europe was the outlier with only 48% planning increases, down from 59% in 2024. This market is highly fragmented and stringent privacy regulations limiting the use of customer data for targeting purposes may be making it more challenging for these marketers to see the full benefits from RMNs.
If we analyze responses by industry instead of region, we can see striking differences in RMN adoption as well. Auto marketers are ahead of the curve, while travel & tourism marketers seem to be more cautious at this stage.
What’s driving retail media growth?
When we asked marketers about the role that RMNs played in their media strategy, many had a full-funnel vision for them. Retail media is not just about driving consumers to fill their shopping basket anymore. But here too, the variations by industry are telling.
Automotive marketers are again leading the pack, if not to test new product launches, but at every step of the purchase funnel once their product is in-market. Retail companies aren’t as concerned about boosting brand visibility since consumers are already on their platform, but most other industries are. In fact, outside of retail and technology, all other industries represented in our survey prioritized using RMNs for top-funnel use cases over low-funnel conversions.
How are marketers spending on retail media?
One of the reasons why RMNs can support marketing campaigns up and down the funnel is the diversity of ad formats that they offer. Amazon, for instance, offers sponsored product placements in the search results feed, display ads, video ads, and a variety of sponsored brand configurations that marketers can use to promote their brand within a store. It’s also possible for marketers to use Amazon’s first-party signals to target consumers off-site, outside of Amazon’s owned and operated properties.
We turned to Nielsen’s Ad Intel data to understand how brands typically split their retail media budgets between different ad formats on Amazon. Globally, sponsored products capture 40% of those budgets, followed by sponsored brands (24%), display (20%), and video ads (16%). It’s not surprising to see the bulk of retail media spend going to sponsored products, the most native of all ad formats on RMNs. But the patterns vary greatly from country to country. Sponsored brands and display ads dominate in Germany, for instance, while marketers in the U.K. are all-in on video ads.
When we look at the same media spend data by vertical, we found that food and drink brands tend to lean in to display. Note also how little telecom brands rely on sponsored products, and how much entertainment brands rely on videos.
The 2025 priorities for retail media
What should RMNs take away from those insights?
First, they need to look beyond shopper marketing and realize that brands are expecting them to be connected to the greater advertising ecosystem to help them meet a wide variety of marketing objectives. Off-site media spend is expected to grow 2-3X faster than on-site media spend for RMNs over the next couple of years. It’s a huge opportunity for them to capture a bigger slice of the advertising pie.
Marketers in most industries today tend to rely more on in-platform attribution tools than independent third-party measurement solutions to gauge the success of their full-funnel retail media campaigns. This will need to change for RMNs to fulfill their true potential.
RMNs are going to need to up their game and usher in what BCG has called Retail Media 3.0: A greater focus on media excellence (providing media options comparable to, and compatible with, the rest of the advertising ecosystem) and on developing strategic relationships with their brand partners. Both of those focus areas point to an increased need for independent measurement.
For more insights on global marketers’ concerns and priorities this year, please check out our fresh-off-the-press 2025 Annual Marketing Report.
