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.
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.
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.
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.
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).
Challenges in Retail Media
Despite strong growth, retail media isn’t without its hurdles. Respondents identified three main challenges:
- High costs: 46% of respondents cited this as a significant barrier.
- Measurement and attribution: 42% struggle with determining the true impact of retail media investments.
- Data transparency: 35% expressed concerns over the quality and accessibility of performance data.
These challenges underscore the need for greater collaboration between brands, agencies, and retailers to create more standardized measurement practices and enhance transparency.
Opportunities Ahead
Looking forward, the survey highlights several opportunities for optimizing retail media strategies:
- In-store retail media innovation: There’s a growing appetite for in-store activations, from smart displays to digital shelf solutions, which can bridge the gap between physical and digital shopping experiences.
- Greater collaboration: Agencies can play a critical role in helping brands and retailers navigate complexity and achieve better results.
- Experimentation and optimization: By testing new channels and formats, brands can better understand what drives ROI and build more effective strategies.
Conclusion
Our research shows retail media is no longer a nice-to-have – it’s a central component of brand marketing strategies. While investment continues to rise, so do expectations for performance, transparency, and innovation. Brands, retailers, and agencies that can work together to address challenges and capitalize on new opportunities will be best positioned to thrive in this fast-evolving landscape.
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.
