Retail media viewed as part of the holistic media mix

A combination of traditional retailers and Amazon retailers is expected to build a US$2bn retail media segment over the next five years. 

That's according to a PwC forecast, based partly on an industry survey* of 117 advertising investment decision-makers or influencers conducted by IAB Australia.

Why it matters

Retail media has the potential to grow the advertising investment pie, driven by technological advancements, but retail media networks that are not being integrated with other tech is the top barrier to partnering with retailers.

Key insights

• Retail media advertising campaigns are focused on the bottom of marketing funnel objectives, and reaching shoppers at the point of purchase is seen as a main opportunity, with nearly nine in 10 respondents using retail media campaigns to increase sales.
• The top opportunity of partnering with retailers for over half of respondents is getting access to first-party data – six in 10 see retail media as a key part of their advertising strategy following the deprecation of third-party cookies.
• It will be important for retailers to build trust, transparency and understanding of the data-value exchange with consumers to ensure ongoing collection.
• Almost a third of retail media investment (31%) is coming from new budgets, while 69% is reallocated from other budgets (such as digital advertising and trade retail budgets).
• Currently, retail media activity is focused on search and display ads for retail-oriented advertisers; search and display ads are the most used formats, although there is high appetite to try in-store point of sale and off-site extension retail media options.
• Those advertisers and agencies currently participating in retail media activities are more likely to be in FMCG, retail, health and beauty, and alcoholic beverage categories.
• Technology that provides accurate attribution is considered a key requirement and it's currently seen as both an opportunity and barrier for retail media; there are high expectations for closed loop attribution and true ROAS reporting.

*The IAB Retail Media Working Group conducted an industry survey in February 2023, with 81% of respondents having had experience partnering with retailers to advertise to or reach consumers. The insights gathered will help to prioritise industry education and training and identify the most pressing needs of marketers in relation to planning, buying and measuring retail media activity.