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A young and ecommerce-savvy user base in the UK is helping propel TikTok鈥檚 aims. More than two-thirds of the platform鈥檚 user base in the UK is under the age of 35. Given a broader population that is comfortable with digital shopping鈥攐nly China has a greater proportion of total retail sales online鈥攊t鈥檚 clear why the country is a rich testing ground for TikTok.

Chinese ecommerce players Temu and Shein disrupted the digital advertising market in 2023 as they competed to attract online shoppers by bidding up keywords鈥攑articularly in apparel and accessories and home goods. But Temu has also been on a global tear, expanding to nearly 80 countries since early 2023. It has diversified ad spending accordingly to acquire customers in new markets.

US in-store retail media ad spend will total $370 million this year. But as the channel expands, oversaturating stores with ads can cause tension between retail media teams, which focus on maximizing ad dollars, and merchants, which focus on the store as a whole. Online advertising and in-store advertising are not two distinct channels, but instead work together.

Key stat: By 2028, in-store retail media spend will reach over $1 billion but will make up less than 1% of total omnichannel retail media ad spending.

This year, as the digital ad spend outpaces the time consumers are spending on the medium, media companies are leaning into revenue drivers like commerce media while also investing in content that builds community.

Instacart expands Caper Cart ad opportunities to capitalize on in-store retail media demand: The company joins Ahold Delhaize in beefing up its offerings to give CPG advertisers more ways to reach shoppers.

Retail media ad spend will make up over one-fifth of total US ad spending by 2027, per our forecast.

This is the first installment of our quarterly 鈥淎d Spending Benchmarks鈥� series, which helps ad buyers and sellers calibrate their spending and revenue mix against the market.

This is the first installment of our quarterly 鈥淎d Spending Benchmarks鈥� series, which helps ad buyers and sellers calibrate their spending and revenue mix against the market.

In-store retail media spend is growing quickly. Just $370 million will go to US in-store retail media ad spend this year, or 0.7% of omnichannel retail media ad spend, but by 2028, that figure will more than double to $1 billion, per our March 2024 forecast. In-store retail media spend is comparatively low despite a massive audience. There鈥檚 limited space and limited inventory.

Last year was similar鈥擟PG ad spending increased by just 4.7%, versus the national industry average of 10.6%. Regardless of slow growth, CPG is locked in as the second-largest spender on digital ads. CPG鈥檚 $39.50 billion in spending this year will be over $9 billion more than the third-ranked spender, financial services. Conversely, CPG鈥檚 total will trail retail by more than $34 billion.

By 2027, retail media will nearly tie with social media as No. 2 ad spend channel, second only to search. Retail media will be bigger than connected TV, digital audio, traditional television advertising combined in 2027. 鈥淭he reality is that retail media is not invincible,鈥� said our analyst Max Willens during a recent webinar.

鈥淭hat disparity can create wildly different pictures of the effectiveness of the ad spending,鈥� said Willens. Who is pushing for standardization? The Interactive Ad Bureau and Media Ratings Council released a set of proposed retail media standards in September, as did Albertsons Media Collective back in June. We鈥檝e written about other emerging solutions as well.

Shoppers can鈥檛 easily abandon carts in stores as they can online, but they can grow frustrated and cut shopping trips short or decide not to return. Instead, think about how retail media can assist shoppers on their journeys. 鈥淢aybe it's facilitating product discovery, or offering knowledge that they would want about a product and that doesn't feel disruptive,鈥� Marzano said.

Off-site retail media network ad spend will rise by 61.5% this year to reach $10.64 billion in the US, per our forecast. With third-party cookies (eventually) going away, we expect to see more such partnerships that allow publishers to leverage retailer first-party data on publisher sites.

The pandemic ecommerce boom may have come to an end, but marketplaces will continue to expand their share of US retail ecommerce. We expect US ecommerce sales to grow by $588 billion over the next five years with marketplaces accounting for nearly 40% of those gains. The channel will continue to grow in importance as more brands seek consumers wherever they are.

Real-world example: Klarna has a retail media network on its platform, which also boasts an AI-powered shopping assistant. This was originally featured in the Retail Media Weekly newsletter. For more marketing insights, statistics, and trends, subscribe here.

Until a standard is widely adopted, the job of a retail media network is to be as clear as possible when communicating their return on ad spend. Keep your finger on the pulse. Hiatt and Opare-Abetia are both bullish on in-store retail media innovations. In a future state, retailers could offer personalized ads, tether screens to mobile devices, and create individualized offers.

Being able to get more granular with search targeting would be a major benefit, according to Emily Frankel, senior vice president and head of ecommerce marketing at PepsiCo. 鈥淭he ability to do audience targeting across media tactics has been around for a while.

And they鈥檙e not being accounted for in that [return on ad spend] equation yet.鈥�. In an Insider Intelligence survey, we asked marketers what the most important attributes for retail media networks were. Not surprisingly, traffic quality and traffic sale were at the top of the list, but right below those was in-store/omnichannel sales data.

The vast majority (81.5%) of retail media ad spend will go toward on-site formats this year, per our October 2023 forecast. As advertisers seek to target consumers whenever and wherever possible, other formats are emerging, particularly in-store, streaming, and social.

We鈥檙e showing some strength in retail ecommerce thanks to our internal assumption that the US is going to successfully achieve something of a soft landing, that inflation is going to get, by the second half, somewhat under control, and that fears of a recession are going to recede at least somewhat in the US market, leading to a very marginal rebound in the outlook for ecommerce 辞惫别谤补濒濒.鈥�.

That can help drive other sources of revenue, like retail media, because the more sellers they have on their e-commerce platforms, the more incentive there is for those sellers to then advertise to get higher placement on their websites. Marcus Johnson:.

Those insights have reportedly led to an average increase of nearly 30% in overall return on ad spend (ROAS) for Sam's Club MAP advertisers. Analyst take: Sam鈥檚 Club is leveraging its deep understanding of its members to deliver what advertisers have long seen as a holy grail: closed-loop attribution.