State of Retail Media

Retail media is becoming increasingly popular, with U.S. omnichannel retail media ad spend projected to more than double from $54.85 billion in 2024 to $129.93 billion by 2028. G-Comm partnered with Path to Purchase Institute to conduct comprehensive research on retail media investment trends, challenges, and opportunities to better understand how brands, retailers, and agencies navigate this dynamic space. Our study, which surveyed 88 professionals across CPG brands, retailers, and agencies, revealed fascinating insights about the current state of retail media networks (RMNs) and where the industry is headed. Here’s a look at our key findings.

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Investment in Retail Media Networks Continues To Increase

The research clearly shows that retail media investment is on an upward trajectory. A strong majority (61%) of respondents reported increased investments in RMNs compared to the previous year. This growth isn't just about spending more – it's about expanding reach across networks.

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A striking 85% of CPG brand respondents now invest in four or more networks, up significantly from 66% last year. This expansion is particularly pronounced among larger organizations, with CPG companies generating over $1 billion in annual revenue and more likely to work with seven or more RMNs.

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CPG brands allocate approximately 27% of their budgets to retail media, a figure that survey participants expect to remain relatively stable this year.

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CPG brands and agencies are most interested in allocating retail media budgets to shopper and e-commerce and least to brand and trade.

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The Current Versus Ideal Retail Media Mix

One of our most revealing findings concerns retail media spending distribution across different channels. The current retail media mix for CPG brands breaks down as follows:

• On-site activities: 40%

• Off-site tactics: 29%

• In-store initiatives: 17%

• Direct tactics: 10%

When asked about the ideal mix, respondents suggested subtle but important shifts. They envision reducing on-site activities to 36%, while increasing in-store tactics to 21%. However, perspectives differ between stakeholders – brand and retailer executives favor a heavier focus on on-site activities, while agency professionals advocate for greater investment in in-store tactics (but not more than on-site or off-site).

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Factors Driving RMN Investment Decisions

What makes brands choose one retail media network over another? Our research identified several critical factors that influence these decisions. At least 74% of brand and agency professionals cited the following as highly influential considerations:

• Data and insights quality

• Scale and reach

• Reporting capabilities

• Alignment to brand strategies

• Data transparency

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When evaluating whether to maintain existing retailer media partnerships or explore new ones, performance metrics, audience reach and quality, and cost efficiency emerged as the top considerations, cited by over 70% of respondents. Data transparency and control also played a significant role, mentioned by 61% of participants.

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Impact on Brand-Retailer Relationships

Perhaps one of the most positive findings from our research is the effect of retail media investments on brand-retailer relationships. An overwhelming 81% of professionals reported that these investments have had at least a somewhat positive impact on their partnerships.  

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Diving deeper, 75% noted that these investments have strengthened overall relationships, while more than 40% highlighted benefits such as:

• Enhanced collaboration opportunities

• Access to incremental merchandising opportunities

• Increased knowledge sharing

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RMN Performance and Effectiveness

The research revealed generally positive perceptions of RMN performance. At least 71% of CPG brand and agency professionals consider RMNs to be somewhat effective or better at the following:

• Increasing brand awareness

• Delivering incremental sales

• Acquiring new customers

• Improving customer lifetime value and retention
  

Nearly half of respondents went further, rating RMNs as "very effective" at increasing brand awareness.

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When it comes to measuring success, we found alignment between what retailers provide and what brands need – profit, media, and sales metrics are the most commonly used KPIs, with at least 73% of participants citing these as key measures.

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Managing Retail Media Programs

Our research showed interesting patterns in how organizations manage their retail media programs. While strategy oftentimes is handled in-house, 47% of CPG respondents leverage agency partnerships for media buying and execution. Among CPG brands managing aspects in-house, nearly 60% have dedicated teams, typically with four or more staff members.

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Those working with agency partners cited expertise and resources as key benefits. As one respondent noted, agencies bring "specific knowledge of retailers and capabilities" and can "lean on multiple clients’ experiences and past performances to provide insightful recommendations."

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Challenges and Areas for Improvement

Despite the positive momentum, several challenges remain. One-third of participants expressed high confidence in RMNs' ability to provide quality data for effective targeting, with nearly half indicating they were only somewhat confident.

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The top challenges cited by brand and agency professionals were these:

• High costs (71%)

• Lack of budget (61%)

• Minimum spend requirements (55%)

• Lack of actionable data (38%)

• Integration difficulties with other marketing tools (36%)

• Complexity of managing multiple RMNs (32%)

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Looking ahead, respondents identified several priority areas for retailer investment to improve their retail media offerings:

• Analytical capabilities

• Ability to optimize campaigns in-flight

• Closed-loop attribution

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Future Retail Media Investment Outlook

The future of retail media investment looks promising, with 94% of CPG brand and agency respondents indicating they plan to continue increasing investment, provided results remain strong. This is what they said when asked about funding sources for these increased investments:

• 47% expect a mix of both new and existing budget dollars

• 43% plan to shift from existing budgets

• 60% anticipate pulling from brand budgets

• 46% expect to tap into trade budgets

• 40% plan to use media budgets

• 25% will draw from shopper budgets

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Key Trends Shaping Retail Media's Future

Our research paints a picture of a maturing retail media landscape where stakeholders are becoming more sophisticated in their approaches and expectations. As we look to the future, several key trends are poised to reshape the retail media industry:

• Media Quality and Fraud Prevention: Media waste and ad fraud remain ongoing challenges in the digital advertising ecosystem, including retail media. While these issues can't be completely eliminated, the industry is developing more sophisticated tools and practices to minimize their impact. Leading retailers and platforms are implementing robust verification systems and transparency measures to ensure brand investments deliver real value and reach actual consumers.
  

• Clear Authority and Decision-Making: The most successful retail media programs are distinguished by clear governance structures. Organizations executing at the highest level have established explicit frameworks for who owns each decision and how those decisions map to customer benefits. This clarity of authority and purpose will become increasingly critical as retail media programs grow more complex.
  

• Retailers' Rising Role in Upfronts: We're seeing a significant shift in how retail media networks participate in the annual planning process. Forward-thinking retailers are positioning themselves to compete with major digital properties by helping brand partners plan their upfronts with rich data and insights. This evolution marks a meaningful change in how brands approach their annual media planning and allocation.
  

• Consumer Data-Sharing Evolution: While achieving a complete 360-degree consumer view through consolidated retail data remains aspirational, we're seeing positive movement in data-sharing practices. More retailers recognize the benefit of sharing data cohorts with brands to drive sales growth. This trend toward strategic data collaboration will continue to expand, though likely in focused, practical ways rather than through comprehensive data consolidation.

• Market Efficiency Through Network Consolidation: Concerns about "too many RMNs" will naturally resolve through market dynamics. Networks that can't generate sufficient revenue to maintain dedicated sales and service teams will likely consolidate through other platforms. This natural evolution will lead to a more efficient market, even as the overall retail media ecosystem grows.

• Pragmatic Progress in Measurement: In five years, measurement challenges won't disappear entirely. Brands likely will continue to face some limitations in measuring exactly what and how they want across retailers. However, we expect significant progress: fewer pain points, better insights, and data quality, and, eventually, a plateau where further improvements yield diminishing returns.
  

Want to dive deeper into our Path to Purchase survey insights? Access the full report at P2PI's Special Report: Retail Media Reality Check. Or looking to accelerate your retail media? G-Comm’s expert team can help you develop and execute strategies that avoid common pitfalls, maximize your investments, and get ahead of what’s coming next in the retail space.

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Angela Myers, currently serving as SVP of Retail Media for G-Comm, a division of Goodway Group, brings over 20 years of experience across retail and ad tech with former leadership roles at Oracle, Datalogix, and A&P. With a strong background in insights, analytics, data monetization, and retail media coupled with a customer-first approach, Myers now leads G-Comm, Goodway Group's retail media accelerator, expertly navigating brand marketers and retailers through the evolving retail media landscape.  

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