The Drum Awards Festival - Extended Deadline

-d -h -min -sec

Retail Media Digital Marketing Branding

Who’s really driving the increase in retail media?

By Mathieu Azorin, Managing Director EMEA


Promoted article

April 26, 2021 | 6 min read

Sponsored by:

What's this?

Sponsored content is created for and in partnership with an advertiser and produced by the Drum Studios team.

Find out more

E-commerce growth

Covid-19 accelerated the great e-commerce migration that began years before. By some estimates, online shopping achieved between two and three years’ worth of growth in just 12 months, now reaching 27.5% of total retail sales and on track to reach a full third by 2024.

Who will own the customer in 2021?

Who’s really driving the increase in retail media?

This jump of 14.7% far surpassed the 9% growth in 2019, which was already considered to be above expectations. In Criteo’s mid-2020 Peak to Recovery survey of more than 13,500 shoppers worldwide, we found that 53% of shoppers have discovered at least one form of online shopping during Covid-19 – somewhat astounding for a maturing marketplace.

While consumers quickly adapted to new shopping behaviors as much out of necessity as convenience, marketers did the same.

Retail media growth

In order to adjust for the lack of in-store brand interaction (shelf placement, displays, advertising), marketers needed to double down on the digital shelf. Retail media (ads placed on a retailer’s e-commerce site or app by a brand in order to influence the customer at the point of purchase) allow marketers to connect with their target audience when they’re in purchase mode, in addition to their typical digital advertising.

In Criteo’s October 2020 State of Digital Advertising survey of EMEA marketers, 55% stated that they were planning on increasing their spend on retail websites and apps over the next six to 12 months, with only social media more popular at 56%.

Retail media market size

This shift in retail media spend has actually far surpassed the growth in overall e-commerce. Late last year, GroupM was forecasting that e-commerce related advertising would grow around 50% for all of 2020 and 66% in 2021, reaching £2.4bn in media-owner ad revenue by 2024.

Why is the growth in retail media so much higher than online sales? Outside of the US, retail media is still relatively nascent. While that may seem like a stretch for a multi-billion number, it’s true – much of the development of the retail media ecosystem has been driven by the largest brands and retailers, paving the way for the mid- and long-tail players to follow.

Market growth sources

Where is the budget coming from? As noted above, offline media is one big source. GroupM anticipated that television would fall by 10% in 2020 despite the increase in viewing time – and with such large budgets, a 10% drop in television advertising is significant.

In an August 2020 report by Forrester Consulting commissioned by Criteo, the largest sources of retail media budget funding were coming from traditional media (TV, print, out-of-home, etc), video, social and in-store. Smaller budget reallocation would come from search, net new and display.

While e-commerce sales soar, total retail declines are hindering marketing budget growth, making it no surprise that net new falls at the bottom of the list.

Brands are leading the way, with retailers close behind

We can cut the suspense – as alluded to earlier, brand advertisers are really pushing the growth of retail media globally. While consumers actually like ads on retail sites – claiming that they like the products they see, and go on to buy them – they’re merely benefitting from the media. Retailers are close behind, however.

Initially, building out e-commerce capabilities consumed much of retailers’ time, money and effort, and monetizing their sites wasn’t an urgent priority. That’s no longer the case, however, and retail media is now seen as a steady profit pool to offset what is typically their lower-margin e-commerce business.

Why brands like retail media

Aside from the benefit of moving closer to the consumer online, there’s a lot for brands to like about retail media. Spend can be tracked down to the SKU level – something no other media can provide.

Advertising on retail sites is also inherently a brand-safe environment with first-party data, avoiding the challenges associated with third-party cookies.

Last but not least is strong performance. Retail media, thanks to its tracking capabilities, was one of the original performance media vehicles.

What’s next?

Brands still believe there’s plenty of room to grow. From e-commerce partners like Criteo, they’re expecting new and innovative ad formats and even more transparency and control.

They want help driving complexity out of the market, via both technology and processes – which will also involve retailers. From them, they also want better omnichannel data, the ability to track shoppers wherever they are and to execute in the most scalable and efficient manner possible – which means the least fragmentation possible. Platform proliferation will increase complexity and cost. Criteo’s Commerce Media strategy strives to achieve this across the greater commerce ecosystem and is an essential element of the future of advertising, central to future e-commerce growth.

Retail Media Digital Marketing Branding

More from Retail Media

View all


Industry insights

View all
Add your own content +