What: A new point of view challenging the importance of retail media networks, seen today in the industry as strategic and with almost unlimited potential.

Why it is important: Retail Media Networks offer many possibilities for retailers, however, scalability (of their systems, of their audiences) is key. Does this mean that department stores might have to team up in order to propose efficient solutions to brands?

The contributor argues that Retail Media Networks are mostly a fancy way to describe retailers’ ability to use their digital properties to sell advertising to brands just like what a media property would. However, she points out 2 major differences:

-    Retailers have access to their customer’s data, which is a treasure in a cookie-less world,

-    When customers visit retail properties, they are obviously doing so with shopping in mind, meaning that we are not talking convincing, but nudging them in their decision-making process.

This is why the author acknowledges the importance of the retail media network market today, which McKinsey estimates at $100 billion in 2026 (today, the global digital ad revenue is estimated at $616 billion). It is even expected that retail media network growth surpasses global digital advertising one in 2027.

However, she also makes a few comments that explain why she sees limitations to the retail media network expansion:

-    Not every brand is a potential spender, as CPG brands are mostly doing so these days, and their spending is not incremental, but comes from their trade marketing budgets,

-    To be credible, retailers need to have a significant base of customers, and/or a guaranteed amount of traffic,

-    There is a limit to the number of retail media networks brands can partner with,

-    There is a limit to the number of brands able to make the most of retail media networks,

-    Retail media networks do not improve relevance for customers, but the targeting, which is different.

The contributor concludes by reminding us that, while retail media networks still offer the potential for growth, they might not be the panacea, and might generate some customer fatigue at some stage.

Retail Media Networks are having a moment but it won’t last