5 Reasons to Shift to Online Retail Advertising

U.S. omnichannel retail media ad spend is expected to reach $129.93 billion by 2028, up from $54.85 billion in 2024. Importantly, 4 out of 5 (81 percent) of advertisers say retail media is at least “very important” to their strategies—representing a higher level of importance than any other marketing channel.

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Outpacing other traditional and digital channels in terms of growth, commerce media and retail media platforms offer brands direct access to audiences at critical points in the purchasing process. This approach allows brands to tap into first-party data from retailers, create impactful advertising strategies, and deliver relevant ads within digital shopping environments. For marketers seeking to maximize their reach and influence, online retail advertising is proving to be a powerful tool for engaging today’s digital shoppers. 

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Here's why brands should shift more attention and budget to online retail advertising. 

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1. First-Party Data Dominates.

In a privacy-focused landscape, first-party data has become a key differentiator in online retail advertising. As third-party cookies are phased out, brands are relying on first-party data collected by retail platforms. This data—gleaned directly from customers’ interactions on retailer websites—allows advertisers to create highly targeted and personalized ads. Retailers can provide insights on customer behavior, such as purchase history, preferences, and browsing habits, enabling brands to reach audiences with a higher degree of relevance. The result is not only improved targeting but also greater alignment with data privacy regulations.

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2. Retail Media Yields Immediate Impact.

Retail media offers a unique advantage in terms of immediacy. Because ads are served directly on retailer platforms, they reach consumers who are actively in the shopping mindset. This means ads can drive sales within minutes, creating a direct and measurable impact on revenue. Whether it’s a sponsored product ad appearing as consumers browse for similar items or a display ad showcasing a promotion, retail media is designed to capture the shopper’s attention at precisely the right moment. This immediacy translates to quicker return on investment (ROI) and enhanced brand visibility.

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3. Retail Media Helps Brands Keep Pace with the Competition.

As more brands shift their focus to online retail advertising, the competitive landscape is rapidly evolving. Investing in retail media allows brands to stay relevant and keep up with competitors who are already leveraging this channel. By maintaining a presence on leading retail platforms, brands can ensure they are not only visible to potential customers but also actively competing for their attention. This visibility is crucial, especially for brands in crowded markets.

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4. Retail Media Is Becoming More Sophisticated.

Retail media is no longer limited to simple product placements and banner ads. With advances in technology and data analytics, retail media networks are becoming more sophisticated, offering an array of ad formats and targeting options. From programmatic capabilities and video ads to sponsored search and social integrations, brands now have a diverse toolkit to create impactful, multi-channel campaigns. These advances mean that brands can not only reach shoppers more effectively but also experiment with various ad formats to see which ones resonate best with their target audience.

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5. Retail Media Can Align with the Full-Funnel Journey.

Retail media isn’t just about driving immediate sales; it can support the entire customer journey, from awareness to consideration to purchase. Many commerce and retail media networks offer solutions that allow brands to create full-funnel campaigns, with ads that speak to consumers at each stage of their journey. For example, an upper-funnel ad might highlight brand values or new product features, while a mid-funnel ad could provide detailed comparisons or customer testimonials. At the lower funnel, brands can use retail media to deliver special offers or product reminders to encourage final conversions. This ability to align with the full-funnel journey makes retail media a versatile option for holistic marketing strategies.

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Retail media is quickly becoming a non-negotiable part of digital marketing strategies. As more brands recognize its benefits and invest in this channel, those who fail to adapt risk falling behind. 

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