With a compound annual growth rate (CAGR) of 20% from 2023 to 2032, retail media is growing faster than almost any other form of ad spend. As per the eMarketer report, the industry will receive $140 billion of ad spend by the end of 2024. At this pace, GroupM estimates that the retail media spending will surpass total digital advertising through 2027.
One thing is clear - the retail media landscape is changing fast. Retail platforms are now rising as the most preferred digital advertising hubs, mostly because they allow brands to meet consumers directly in shopping environments.
Retail media offers advertisers a unique opportunity to reach consumers with highly relevant messages, often embedded within the shopping experience. However, the growing complexity and scale of this landscape require an organized, data-driven approach to truly capture value. This is where Retail Media Networks (RMNs) come into play.
What is so unique about Retail Media Network?
In simple terms, it is a retailer’s complete ecosystem that includes both channels owned by the retailer directly and channels owned by third-party media partners of the retailer, providing ad inventory to advertisers where they can display their ads.
It is just like the ad networks offered in programmatic, but yet it’s very different and more valuable. How?
RMNs operate within the retailer's environment, allowing brands to reach consumers in moments of high purchase intent. Unlike other forms of digital advertising, RMNs leverage first-party data to provide targeted, personalized advertising options that are increasingly valuable as data privacy regulations restrict third-party data use. For brands, this means the ability to tailor ads based on highly specific consumer behaviors within a trusted retail environment, increasing both relevance and impact. RMNs also offer closed-loop attribution, allowing brands to directly connect ad spend with measurable outcomes, such as conversions and in-store sales, which is often difficult with conventional ad platforms.
Retail Media vs. Retail Media Networks
Retail media and Retail Media Networks (RMN) are closely related but not identical concepts. Retail media broadly refers to advertising within retail environments—whether online, in-store, or across digital channels. It’s a foundational practice that positions ads where they meet consumers in the shopping mindset, enhancing visibility and potentially driving impulse engagement.
Retail Media Networks, however, elevate this concept into a focused, data-powered platform. RMNs leverage first-party data and closed-loop attribution, connecting ad engagement with measurable outcomes within the retailer’s ecosystem. This means that brands can move beyond basic visibility to strategic engagement, tailoring messaging to specific consumer behaviors and refining campaigns in real-time based on conversion data.
The Importance of RMN in Modern Advertising
For brands and retailers alike, RMNs provide an evolution beyond traditional digital advertising, allowing them to drive measurable impact, deepen customer relationships, and adapt to privacy-first data strategies.
First-party data as a competitive advantage
RMNs offer a pivotal advantage: access to first-party data gathered from the retailer’s ecosystem. However, RMNs aren’t merely about accessing data; it’s about translating this data into strategic customer insights that drive precise targeting and, ultimately, improved ROI. Brands gain a clearer understanding of what resonates with their audiences, informing future product development and marketing decisions.
Precision targeting at the point of intent
RMNs provide ad placements directly within the customer’s shopping journey, such as on product pages or checkout screens, where intent to purchase is highest. This contextual relevance allows brands to influence consumer choices at decisive moments, maximizing ad effectiveness and reducing ad waste.
Closed-loop attribution and actionable metrics
RMNs excel in closed-loop attribution, linking ad exposure to actual purchases within the retailer’s environment. This ability to connect ad engagement directly to sales—whether online or in-store—enables brands to measure ROI with greater accuracy. This transparency allows for more strategic ad budgeting and performance optimization. It’s a significant step toward aligning marketing expenditures with business outcomes, ensuring every ad dollar is justifiable in terms of direct revenue impact.
Enhanced shopper experience and customer loyalty
RMNs enhance the customer experience by aligning advertisements with shopper intent. This integration enriches the shopping experience, turning advertisements into value-adds rather than interruptions. Over time, this approach strengthens customer loyalty, drives immediate revenue, and helps build long-term loyalty.
Overcoming Key Challenges in Retail Media Networks
Retail Media Networks (RMNs) offer powerful engagement opportunities, but to unlock their full potential, brands and retailers must address operational, compliance, and relational challenges with precise strategies.
Operational complexity
Building an effective RMN requires robust infrastructure, from cloud-based, scalable systems to advanced data analytics. These systems enable real-time ad placement and accurate performance tracking but demand significant investment in technology and specialized talent. To streamline complexity, modular architectures and dedicated RMN teams with expertise in data science, compliance, and ad tech can ensure that RMNs scale efficiently and remain agile.
Data privacy and compliance
As data privacy regulations tighten, RMNs must adopt privacy-first data governance frameworks to safeguard consumer information. Encrypting, anonymizing, and tightly controlling data access helps maintain compliance, while transparent consumer data policies build trust and loyalty. Retailers can enhance compliance further by offering data transparency portals, allowing consumers control over their data, thus meeting regulatory expectations and strengthening customer relationships.
Balancing brand-retailer dynamics
RMNs position retailers as both collaborators and competitors to brands, which can strain relationships. Establishing clear data-sharing agreements—offering aggregated, anonymized insights—helps retailers balance control while providing brands valuable insights. Retailers can also reserve distinct ad spaces to minimize competition between their private-label products and partner brands. This approach fosters a cooperative environment, aligning both parties’ interests in delivering value without compromising their competitive positions.
Emerging Trends in Retail Media Networks
Retail Media Networks (RMNs) are evolving rapidly, revealing new trends that go beyond traditional advertising models.
Expanding non-endemic partnerships
A notable shift in RMNs is the rise of non-endemic advertising - ads for products not sold directly by the retailer. This trend allows RMNs to act as lifestyle platforms, where brands in diverse categories (like finance, travel, and entertainment) reach audiences based on interest and behavior rather than direct product sales. This approach not only diversifies RMNs’ ad inventory but also positions them as multi-industry data hubs, providing advertisers with insights into lifestyle choices and expanding their consumer touchpoints beyond conventional retail.
Incrementality as a core metric
Retailers and brands are increasingly focused on incrementality—the added value an ad generates beyond organic sales. Unlike traditional metrics such as Return on Ad Spend (ROAS), incrementality captures net new sales, helping advertisers assess long-term impact and customer acquisition. This trend reflects a strategic move towards metrics that emphasize sustainable growth, with RMNs leveraging their closed ecosystems to link advertising efforts directly to incremental outcomes. Brands looking to optimize their RMN strategies are beginning to prioritize incrementality to understand how ads contribute to overall growth.
Commerce media extending beyond retail
“Commerce media” expands RMN principles to non-retail sectors, showing how RMNs can be adapted to industries like food delivery, travel, and banking. As these sectors explore RMN-based ad models, they can leverage first-party data to offer contextual ads during interactions, such as targeted offers in a food delivery app or travel recommendations during hotel bookings. This evolution demonstrates RMNs’ potential beyond the retail environment, turning service-based platforms into valuable ad ecosystems where consumer intent aligns with targeted advertising opportunities.
In-store digital advertising and programmatic buying
In-store digital advertising is gaining traction as RMNs begin to merge physical and digital retail experiences. By implementing programmatic digital screens and smart displays, retailers bring dynamic ad placements into stores, allowing brands to reach consumers as they shop. This trend provides a dual advantage: enhancing the in-store shopping experience and using real-time data to personalize ad content based on shopper behavior. Such integration enables RMNs to offer brands high-impact, omnichannel opportunities within both physical and digital settings.
Shoppable content and interactive ad formats
Shoppable content within RMNs is turning passive viewership into active engagement by embedding purchase options directly into content. This trend allows ads to serve as interactive touchpoints where consumers can explore products and make purchases in one fluid experience. As shoppable media gains prominence, RMNs can provide brands with more immersive advertising formats that encourage immediate action, blurring the lines between entertainment and e-commerce. This evolution in content not only increases engagement but also enables brands to meet consumers in moments of high intent.
The Future of RMN with AI
Optimizing ROI with adaptive intelligence
AI is reshaping RMNs into platforms that drive measurable outcomes. Self-learning algorithms analyze real-time data to shift ad spend dynamically, prioritizing placements with the highest impact. This evolution helps RMNs achieve leaner operations, minimizing ad waste and sharpening ROI - a decisive advantage in a competitive market.
Real-time response to demand surges
AI enables RMNs to act instantly on-demand spikes and market shifts, an agility that traditional methods can’t achieve. By reallocating resources on the fly, RMNs stay aligned with evolving customer expectations. This real-time adaptability not only captures surges as they happen but positions RMNs to preemptively meet market needs.
Capitalizing on first-party data as a strategic asset
As third-party data becomes obsolete, RMNs have a new opportunity: leveraging first-party data to create exclusive, highly personalized ad experiences. With AI-driven insights, RMNs can go beyond ad placement to offer unique audience segments, transforming the network into a proprietary ecosystem that deepens brand loyalty and customer engagement.
Expanding revenue with predictive product strategies
AI’s predictive capabilities identify customer-driven product bundles, allowing RMNs to increase average basket size and introduce value-added offerings. By aligning inventory strategies with real-time consumer insights, RMNs can become proactive platforms that anticipate and fulfill customer needs with precision.
Building comprehensive engagement ecosystems
AI is advancing RMNs into full engagement platforms, integrating loyalty programs, mobile apps, and in-store experiences. This holistic approach strengthens customer loyalty by delivering a cohesive brand experience across channels. For brands, it’s a path to not only drive transactions but also build lasting customer relationships and lifetime value.
Preparing Your Retail Media for Success
The future of retail media lies in a seamless blend of digital and in-store experiences enabled by real-time insights and predictive precision.
To stay ahead, retailers must consider their RMNs as evolving ecosystems capable of adapting to shifting consumer behaviors and regulatory changes. This calls for strategic investments in data intelligence, agile infrastructure, and a customer-centric mindset that keeps the brand relevant across touchpoints. Those who prepare thoughtfully now are positioning themselves to lead, capturing lasting value in a market where relevance drives loyalty.
To support your growth in this dynamic space, iOPEX offers tailored Retail Media Solutions that enhance scalability and operational excellence, helping you create a seamless, impactful brand experience across every retail media touchpoint. Contact us today to discover how iOPEX can empower your retail media strategy and help you grow & scale optimally.
