By: Mark Baum, Chief Collaboration Officer & Senior Vice President, Industry Relations, FMI
Retail media is quickly becoming one of the most powerful forces in advertising. As FMI and Oliver Wyman's 10th-anniversary Boardroom article, The Power of Retail Media in Modern Advertising Growth, states, "Retail media may soon be the largest advertising channel in the world." That claim is not just hype — the numbers and evolving strategies in grocery retail prove it.
At FMI, we hear it in every conversation — retailers asking how to best monetize their media assets, CPGs trying to determine where the budgets should come from and how much to allocate, and everyone trying to make sense of the metrics and determine ROI. This is not theoretical — it is happening in real-time. Retail media is not merely an emerging opportunity; it is becoming in some respects essential to the future of consumer marketing and influencing the path to purchase. Many grocers and other retailers are integrating retail media into their core business strategy and are poised to lead in this transformative era.
In our recent report, The Evolution of Retail Media: Decoding What Works — And What Doesn't, produced in collaboration with NielsenIQ and Think Blue, we examine this transformation in depth. Retail media networks (RMNs) are no longer a niche tactic but a strategic growth engine, driving performance-based returns and unlocking powerful consumer insight forecast projects that CPG retail media spending will reach $26.6 billion by 2026, with grocery channels contributing around $6.7 billion of that total. Within grocery, food departments are expected to command nearly 87% of that media investment, demonstrating how RMNs are evolving from simple ad placements to integral parts of the omnichannel shopper journey.
Yet with opportunity comes complexity. On the one hand, grocers have something powerful: deep, trusted shopper relationships and rich first-party data. However, our research reveals challenges, including inconsistent measurement, fragmented organizational structures and transparency gaps that are hampering RMNs from reaching their full potential. Retailers and CPG suppliers are still determining how to best integrate retail media into broader business planning.
“Retail media may soon be the largest advertising channel in the world.”
In Boardroom, we explore the evolution of retail media including the ability to close the loop between ad spending and actual sales. However, this can also become a challenge if not supported by mutually agreed upon standards and a strong data infrastructure. The analysis reinforces the need for aligned metrics, deeper collaboration and the right technology to fully unlock retail media's promise.
Our partners at Oliver Wyman captured this evolution brilliantly. If you have not read their article yet, make the time. It is well worth a few minutes of your day and complements FMI's findings with sharp, forward-thinking insight.
We are also going to launch a series of digital education offerings on retail media activation in partnership with Inmar, designed to keep the conversation — and the learning — concurrent with the evolution of the marketplace and retail media landscape.
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