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As Retail Media Evolves, Brands Face Tough Challenges

May 12, 2025 by James Tenser

AMONG THE MANY CHALLENGES facing CPGs in their efforts to make sense of retail media networks has been a pervasive storytelling bias.

On daily basis, we encounter widespread published commentary and reports celebrating retail media’s headlong growth, along with advice on tech, measurement, and monetization for retailers. Much of it comes from solution providers, consultancies and ad agencies vying to cash in on the burgeoning media sales opportunity. Wall Street analysts have been a megaphone for this side of the story too.

This article is part of a series. Republished here by permission from CPGmatters.

The bandwagon effect has been so powerful, the lure of “new” digital revenue so enticing, that critical thinking is too often abandoned by analysts and bloggers. Spending forecasts are frequently represented with “hockey stick” charts. With each new quarterly release, it seems as if proponents keep expanding the definition of “commerce media” to help drive the forecasts to new heights.

Meanwhile, for brand marketers (the lion’s share of all that juicy ad spending) pragmatic guidance about RMN strategy and practices seems relatively hard to come by.

Balancing the retail media story

As we have been documenting here in recent months, retail media is just now emerging from its nascent state. The digital network side has been dominated by early adopters who pioneered search and sponsored product advertising – Amazon Ads, Google Ads, Walmart Connect, Albertsons Media Collective, Kroger Precision Marketing, Instacart Carrot Ads, and a few others.

Shopper Media Reality: Why It’s Time to Rethink In-Store Networks

April 21, 2025April 3, 2025 by James Tenser

THE RETAIL MEDIA NETWORK frenzy may be approaching the end of the beginning, as Shopper Media bring more In-store retail media options to CPG Brands. Now, the hard work starts.

For CPG brands, the story-within-the-story revolves around a growing number of in-store networks designed to reach shoppers where the vast majority of final purchase decisions are still being made. Call it “shopper media.”

In the food-drug-mass channels, 84% of transactions are still taking place in physical stores, while FMI The Food Industry Association estimates that just 6% of grocery items were sold online in the full year 2023.

This is the fourth part in a series. Republished here by permission from CPGmatters.

As we have been reporting here in recent months, that reality compels brands to consider where their newly-repurposed retail media budgets will best be spent. So far, a handful of very large, primarily digital networks have soaked up the lion’s share of the ad investment.

CPGs have a long history of providing marketing support for their brands across the broad physical retail landscape, not only at the largest chain accounts. Distribution power is brand power.

For this reason, although the big numbers and hype have surrounded digital retail media sales, shopper media retain a significant value-creation opportunity for brands that has barely been tapped:

Frequency of visits. Four out of five shopping trips are still in-person. Even for regional retailers, this can add up to millions of monthly opportunities to present messaging from brands, on screens, via audio and on personal digital devices.
Loyalty penetration. Retail media works best when messages and offers are finely personalized. As frequent shopper participation approaches the saturation point, they present a superb mechanism for brands. With appropriate access, they can leverage first-party and zero-party data to efficiently present offers that motivate repeat consumers and influence potential ones.
Aligned with product distribution. Half or more of all CPG product is distributed across numerous regional and independent retailers. Brands intuitively recognize that physical distribution power is the foundation of lasting success. So far, their retail media messaging has not matched that level of coverage.

Not surprisingly, retail media networks remained top-of-mind at last month’s Shoptalk conference in Las Vegas, both on the presentation stages and in the aisles of the exhibit floor. CPG and grocery attendance was light, and the presentation topics focused on the large retail media and commerce media networks, with little to no mention of the fast-moving consumer goods sector.

Retail Media Scale: CPG Brands’ Conundrum

March 14, 2025 by James Tenser

HOW DO BRANDS UNDERSTAND retail media scale as they plan spending?

In previous articles in this series, we addressed the challenges CPG brands face in dealing with retail media networks. It summarized brand marketer spending trends and described why brand teams are challenged when it comes to making decisions about retail media investments across their entire distribution networks.

We discussed the struggle brands face as they endeavor to support their retail distribution networks with proportional retail media investments across all their distribution channels. With hundreds of small retailers seeking a fair share of the pie, CPGs simply don’t have the bandwidth for empirical decision-making.

Regional and independent retailers are not the only ones concerned about the concentration at the top of the Retail Media Network hierarchy.

CPGs are also wrestling with this, and the conversation is beginning to bring trading partners together in search of workable solutions which enable a fair share of retail media spending to find its way to numerous retailers who are not on the top-ten RMN list.

“The network is the piece that’s missing.”

– Adam Zimmerman, Ideal by Design House

At the handful of larger retailers where retail media is a must, joint business planning discussions have become more complicated, as CPGs work to establish new practices that incorporate traditional trade marketing along with the type of targeted messaging that retail media enables. Negotiations must now address how outcomes can be measured and what merchandising support will be required in the stores and fulfillment centers.

Needed: “Connective Tissue”

At February’s 2025 NGA Show in Las Vegas, two panel sessions were devoted to the existential challenge faced by independent grocers as they seek sufficient retail media scale (i.e., audience size) to be relevant to national brands. Wholesalers and retailer networks represented at the conference discussed their efforts to deliver targetable shopper audiences with sufficient scale and measurability to justify CPG investment.

What’s ‘Fair and Proportional’ for a Retail Media Network?

March 14, 2025February 13, 2025 by James Tenser

HOW ARE BRANDS MANAGING their retail media network spending?

Part one of this analysis addressed the conundrum CPG brands face in dealing with retail media networks. It summarized brand marketer spending trends documented by Cadent Consulting and described why brand teams are challenged when it comes to making sound empirical decisions about their retail media investments across their entire distribution networks.

Steps toward further clarity have been initiated by FMI – The Food Industry Association, which released new research, The Evolution of Retail Media: Decoding What Works — And What Doesn’t, in collaboration with NIQ and Think Blue on Jan. 31 at its FMI Midwinter Executive Conference.

The report forecasts CPG retail media network spending will reach $27 billion by 2026, with the grocery channel commanding $6.6 billion of that total.

Write the study authors, “As RMNs increasingly tap into brand media budgets, brands and retailers must adapt to this new paradigm. Aligning investment strategies, leveraging advanced data-driven personalization, and integrating RMNs into broader business planning will be vital to fully unlock the transformative potential of these networks.”

The report calls out several key challenges that trading partners face in this regard: