The retail media landscape has experienced significant growth and transformation in recent years, establishing itself as a pivotal and disruptive element in the advertising ecosystem. According to broker research in the AlphaSense platform, retail media is projected to become a $100 billion business by 2028 and represent 19% of total media ad spend — up from $50 billion and 13%, respectively, in 2025. This rapid and immense growth is largely driven by the unique assets retailers possess, including first-party transaction data and digital real estate at key points in the customer journey.
Using the AlphaSense platform, we dive into this booming industry, analyzing key trends and growth drivers, challenges, market leaders, and the future outlook for this space.
What is Retail Media?
At the most fundamental level, retail media is advertising within a retailer’s sites and apps. Typically, retail media is orchestrated by brands that directly sell products with retailers, though brands in verticals such as financial services or travel can also pay to promote their products and services on retail sites — also known as non-endemic advertising. These industries are interested in a retailer’s audience but have no specific products to sell on their sites and apps.
Since 2020, consumer behavior has dramatically changed. While the death of brick-and-mortar was already underway by then, the pandemic accelerated the universal adoption of online shopping. Retail media has grown in lockstep with this surge in consumers purchasing online.
Referred to as the third wave of digital advertising (succeeding search and social), retail media became prominent with retailers due to their need for secure, brand-safe advertising environments. As online shopping has grown in popularity, brands are leveraging retail media as a new way to reach customers while retailers are relying on its revenue to offset e-commerce operational costs.
Retail media allows brands to promote themselves on a “digital shelf” through native and display ads, similar to an endcap or special in-aisle feature within a brick-and-mortar. The best part: Ads can be displayed on a retailer’s home page, category page, search page, or product detail page — enabling a brand to reach consumers at any point in the online shopping experience.
Retail Media: Growth Drivers and Trends
Technology and Artificial Intelligence
Like many other sectors, the retail media industry is reaping the benefits of artificial intelligence and other advanced technologies. Personalization is a key growth driver for advertising and, consequently, retail media as it results in better ads, more customer engagement, and ultimately, more conversions. A recent Harris poll found that 59% of shoppers say they often see the same ads repeatedly, resulting in a negative experience and brand impression.
In order to combat ad fatigue and increase relevance and brand affinity in the eyes of consumers, retailers and advertisers are turning to personalization. AI is integral for this — by quickly and accurately analyzing consumer preferences and behavior, it helps create more relevant and engaging ads. AI also increases precision in targeting the right consumers at the right time, increases efficiency by automating repetitive tasks, and facilitates data-driven decision-making.
First-Party Data
First-party data, or data collected directly from customers, is a crucial growth driver for the retail media industry. This data includes shopper product interest, browsing behavior, search data, previous and repeat purchases, loyalty program information, shipping location, and device and engagement data, among other metrics.
Retail media networks leverage first-party data to connect brands directly with high-intent shoppers at critical conversion moments, enabling precision targeting that traditional advertising channels cannot match.
With data privacy regulations increasingly restricting third-party data usage, using first-party data to provide targeted, personalized advertising options becomes even more valuable for brands. Unlike third-party data gathered from outside sources, first-party data is more accurate, transparent, and compliant with regulations. According to a study by Google and Bain & Company, companies effectively leveraging first-party data are generating 2.9x more revenue compared with those that are not.
Omnichannel Integration
Omnichannel integration is a strategy that involves seamlessly integrating physical stores, online websites, mobile apps, and other digital platforms to create a cohesive shopping journey for consumers. As the line between physical and digital shopping becomes increasingly blurred, this approach meets consumers where they are, facilitating an enhanced and more unified experience for them, while also helping retailers improve targeting and increase sales.
Omnichannel platforms enable centralized control of retail media campaigns, as well as real-time data integration. From there, retailers can allocate their media budgets with more precision, improve their understanding of their customers, and deliver a more seamless and consistent customer experience across all touchpoints. In fact, some companies have found that omnichannel customers spend one-and-a-half to three times more money when shopping with them than single-channel shoppers.
Programmatic Advertising
Programmatic advertising in retail media refers to the automated process of buying and selling digital advertising inventory across various retail platforms and channels. It enables brands of all sizes, particularly mid-market companies, to access retail media opportunities that were traditionally limited to larger enterprises.
Because programmatic advertising allows for real-time adjustments, optimization, and more precise targeting, it’s much more efficient and scalable than traditional advertising methods. The most successful programmatic advertising incorporates AI, first-person data, and omnichannel integration to create tailored content, recommendations, and offers for individual consumers.
One recent successful example of programmatic advertising: the partnership between retail media platform Zitcha and programmatic advertising platform StackAdapt. This partnership helps brands of all sizes easily access, scale, and optimize their retail media campaigns across key global markets.
“Programmatic is going to play a big part in the retail media ecosystem, helping RMNs maximize the value of their inventory beyond core sales capabilities. By joining forces with StackAdapt, we’re removing the friction that has kept brands from fully embracing it,” said Troy Townsend, CEO and Co-Founder at Zitcha. “This integration ensures that every retailer, no matter their size, can unlock new revenue streams, while brands can deliver smarter, high-performing campaigns with the efficiency of programmatic.”
Leaders of Retail Media
In 2025, global retail media leaders include both established retail giants and e-commerce platforms that have expanded into the advertising space. These leaders include:
Amazon
Amazon is the global retail media leader, thanks to its robust collection of first-party data and a diverse advertising ecosystem that spans its e-commerce platform, Amazon Prime Video, Amazon Fresh, and more. Because advertisers can easily target consumers directly at the point of purchase with Amazon, the company is expected to continue to capture a significant portion of global ad spend. Importantly, Amazon recently announced its Retail Ad Service, which allows retailers to place and sell ads directly on their e-commerce websites. This is likely to transform the retail advertising landscape and start a move toward consolidation of retail media networks.
Walmart
Walmart’s omnichannel advertising and retail media network, Walmart Connect, has been highly successful in North America and is growing rapidly. The network integrates Walmart’s vast in-store and e-commerce data to offer advertisers targeted campaigns.
Alibaba
As one of the leading retail media networks in China and a global leader in e-commerce, Alibaba has enormous consumer reach internationally. They also have access to plenty of first-party data from their shopping, payment, and entertainment ecosystem — giving advertisers unmatched targeting precision.
Target
Target’s retail media network Roundel combines the company’s considerable consumer data from both physical and digital channels. Target’s robust consumer base in both e-commerce and brick-and-mortar gives it strong data insights into consumer purchasing behavior. Roundel is becoming a leading choice for retailers and advertisers, particularly in North America but globally as well.
The Home Depot
The Home Depot Media Network focuses on the home improvement sector, offering a way for advertisers to reach consumers who are interested in products for home improvement, maintenance, and decor. Home Depot has access to rich consumer behavior data, and its consumer base is generally very willing to spend on home improvement if they are already shopping at Home Depot — making this a lucrative option for advertisers.
Other global leaders include CVS Health, Best Buy, Instacart, Lidl, and Carrefour. While the latter three are newer and less established, they are growing quickly, reflecting the increasing importance of personalized data-driven advertising in the retail space.
Retail Media: Challenges and Considerations
The retail media industry is poised for significant growth in the coming years and is projected to reach $179.5 billion in 2025. Even so, the industry faces significant challenges in scaling and optimizing its platforms. Key obstacles include industry fragmentation, lack of standardized metrics, evolving data privacy regulations, and technological limitations. Below, we dive into each of these in more detail.
Fragmentation
With over 200 retail media networks in existence today, the industry is fragmented and inefficient. Each retailer has its own inventory, tech, and requirements, and advertisers must manage campaigns across multiple networks simultaneously. Many believe that consolidation is the logical next step for the industry, which is why Amazon’s Retail Ad Service could address the longstanding issue of fragmentation in this space.
By extending its proven solution to retailers that sell outside of Amazon, the company is simplifying processes for brands and providing better measurement tools to maximize ad spend. However, consolidation could pose additional challenges for smaller retailers with fewer resources and less visibility than large, established players who will be using the same platform.
Measurement and Attribution Challenges
There are currently no standardized ROI metrics across different retail media networks, nor consistent attribution models, as each retailer usually has its own unique metrics and reporting. This makes it difficult for brands to evaluate retail media performance and allocate budget effectively.
Many platforms rely on last-click attribution, which does not tell the full story of how retail media is impacting incremental sales, leaving key insights on the table. That’s why 57% of advertisers cite attribution modeling as their biggest retail media challenge. There is an enormous need for incrementality testing to help advertisers understand the real impact of their ad spend at each phase.
Evolving Data Privacy Considerations
As first-party data becomes more prevalent, there are some concerns about maintaining customer trust and avoiding being too intrusive with how this data is collected and used. Already, 43% of consumers cite “potential security concerns” as a top issue for retailer websites, and 37% cite the same issue for mobile apps.
Increasing consumer awareness and stricter regulations like GDPR and CCPA are driving retail media networks to adopt privacy-first governance frameworks, practice transparency by informing consumers of privacy policies and data collection practices, and implement more robust security measures to protect customer data.
Technological Limitations
As the retail media industry grows, it needs a way to provide tailored customer experiences at scale. Today’s industry is limited by fragmented customer data, lack of a uniform standard for measurement methodologies, and infrastructure that is not built to support scale without performance issues. AI implementation is also still in its early stages, despite its potential to revolutionize the industry. Yet most players in the retail media industry are not yet ready to make the tremendous investments in talent, infrastructure, and tech stacks that would enable them to grow and thrive.
Retail Media Outlook
Overall, the outlook for the retail media industry is positive. Despite existing challenges, the industry is growing rapidly and is poised for continual expansion in coming years. Retail media networks now account for one-fifth of worldwide digital ad spend, with major players like Amazon and Walmart dominating the market share.
As e-commerce growth keeps accelerating, first-party data becomes increasingly valuable, and technology introduces new possibilities for personalization and omnichannel integration, the retail media industry will benefit retailers, advertisers, and consumers in different ways. Retailers and advertisers will be better able to target and capture consumers, measure their success, and refine their approach — and consumers will have a better, more tailored experience and feel more understood by the brands they shop for.
Still, challenges in the industry cast some uncertainty on the precise direction retail media will take in the next few years. If the industry can consolidate and embrace new possibilities brought by technology, it will be better poised for positive evolution and growth.
Stay Ahead of Developments in the Retail Media Industry
With the fast pace of growth and change in the retail media industry, it’s important to rely on a tool that delivers all the most relevant insights to you in real time, while filtering out extraneous noise. AlphaSense’s vast content universe spans company documents, analyst reports, expert interviews, and news outlets — giving you a full-picture view of the market landscape — and our advanced AI search technology accelerates and refines your search to give you the competitive edge.
