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What are retail
media networks?
And why do they matter?

1 minute read
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What are retail media networks? And why do they matter?

According to Amazon, “retail media networks are a type of advertising platform that allows retailers to sell ad space on their digital channels to third-party brands.” This means that Retail Media Networks (RMNs) are digital ad businesses set up by retailers to monetize their online traffic and to offer their first-party data for targeted offsite advertising.

The consumer shift to ecommerce channels by nearly 30% has accelerated the sector’s expansion and challenged traditional retailers. Major players like Amazon, Walmart, and Target are capitalizing on this trend, making retail media a vital sector in digital advertising with a projected annual global growth rate exceeding 10% through 2026.

Amazon, a pioneer in this field since 2012, valued its advertising business at $37.7 billion globally in 2022. By 2026, Amazon is anticipated to claim a 13% share of the global digital advertising revenue. Copying Amazon’s playbook, Walmart and Target entered the retail media landscape in 2019, paving the way for more retailers and pharmaceutical companies to join in the upcoming years. So why the significant interest? In short, RMNs provide retailers and brands with the following opportunities:

  • Additional revenue for retailers
  • Improved retail footprint
  • Closed-loop reporting and creative support
  • Better shopping experiences for consumers
  • Partnering with tech companies such as Google, Facebook & Criteo

For brands, especially those in the CPG industry, retail media networks provide various options to reach a large, targeted audience. That is why 73% of advertisers anticipate spending more on RMNs in the next 12 months, with RMNs capturing an estimated 10 to 15% of total media spend.

Retail Media Networks also enable brands to tap into the retailers' first-party data and track the return on ad spend (ROAS) to address the shoppers’ needs at each stage of the shopper journey and simultaneously measure their ads’ performance. Other vital capabilities RMNs offer to brands include:

Key Capabilities of Retail Media Networks - Merkle
Image Credit: Merkle
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A quick look into Amazon’s playbook

For brands, native digital ads must blend in with product search results. However, retail media display ads are about guaranteed placement on the retailers’ real estate. The following are some ad examples on Amazon:


Image Credit: Trellis

Sponsored ads

These ads may be displayed at the top of, alongside, or within shopping results and on product detail pages. Ads may appear on both desktop, tablet, and mobile.

example Sponsored Ads - Tinuiti Image Credit: Tinuiti

Display Ads

These include image ads that appear as consumers shop on Amazon, read on Kindle, and even on external websites and apps as part of the Amazon Advertising network.

amazon-display-ad Image Credit: Quartile

Conquesting Ads

This advertising approach enables brands to gain visibility by targeting specific ASINs (Amazon Standard Identification Numbers) to appear above their competitors' search results.

example of Conquesting Ads - Amazon Image Credit: Marketplace Pulse

Retail media networks are here to stay

RMNs have firmly established their presence and are an integral part of the shopping journey, with 74% of brands already allocating budgets for advertising through these networks. They hold a strategic position near the point of purchase, making them highly appealing to brands. With the increasing shift towards online shopping, even for essentials like food and medicine, brands cannot afford to pass up on any opportunity to be front and center for their target audience.

Where can brands start in the Retail Media Networks space?

RMNs can be considered as additional channels to a brand’s omnichannel strategy. Unlike other channels that are heavy on text, retail media networks rely mostly on digital assets such as images and videos. Traditional asset storage and management systems can no longer keep up with today’s digital commerce demands. Manually managing an organization’s assets can take a massive amount of time and resources. Indeed, employees can spend up to a fifth of their time just looking for internal information.

So, if you have an increasing need to manage high volumes of digital assets, a Digital Asset Management (DAM) solution becomes an essential tool for your brand. A DAM serves as a central repository for all images, audio, and video files and promotes the accessibility, discoverability, enrichment, and distribution of digital assets. It’s a simple and straightforward solution that centralizes digital assets for discoverability, consistency, and control.

To thrive in this dynamic environment, brands must adapt and integrate RMNs seamlessly into their omnichannel strategies. Embracing innovative solutions like DAM systems allows businesses to ensure efficient management and accessibility of digital assets. By leveraging these tools, brands can stay at the forefront of the retail media landscape, engaging their audiences effectively and enhancing their overall market presence.

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