Retail media ad spend to reach $223bn by 2027

The market is expanding but growth is slowing, creating pressure on retail media networks (RMNs) to balance advertising revenue with shopper experience and campaign effectiveness

Global retail media advertising investment is set to surpass $200 billion in 2026, reaching $200.4 billion before rising to $223.4 billion in 2027, according to WARC Media. The market is expanding but growth is slowing, creating pressure on retail media networks (RMNs) to balance advertising revenue with shopper experience and campaign effectiveness.

WARC Media’s The Future of Commerce Media 2026 examines the intersection of commerce and advertising, highlighting growing concentration among major retail media networks, increased use of commerce media beyond traditional retail environments and the creative challenges facing advertisers.

Retail media growth slows as market matures

Global retail media investment is forecast to grow 11.5 percent in 2027, when it will account for 15.2 percent of worldwide advertising investment. Excluding Amazon, however, growth is expected to fall to 9.8 percent, the lowest annual growth rate since WARC Media began tracking the market.

Alex Brownsell, Head of Content, WARC Media: “The retail media landscape is maturing and

consolidating, forcing marketers to rethink their approach. While retail media excels at converting existing demand, it underperforms on long-term brand building. Retailers face a delicate balancing act: growing ad revenue to boost margins without overwhelming shoppers with too many ad interruptions that compromise both shopper experience and campaign effectiveness. Success now depends on smart integration with other channels and finding the optimal path to sustainable results.”

Amazon maintains dominance in US retail media

The US market is showing stronger momentum than Europe, where retail media growth is slowing towards single digits. WARC Media forecasts US retail media network spending to increase 13.6 percent in 2028, reaching $74.9 billion.

Spending remains concentrated among a small number of networks. Amazon accounted for 78.0 percent of US retail media expenditure in 2025, while Walmart captured 7.5 percent, leaving 14.5 percent for all other networks combined. In France, Germany, Italy, Spain and the UK, more than two-thirds of retail media spending went to Amazon.

CPG brands allocate more budgets to retail media

Retail media accounts for a majority of advertising investment in several consumer packaged goods categories. In 2027, it is forecast to represent 55.8 percent of global media investment by alcoholic drinks brands and 54.9 percent of food category spending.

Technology and electronics show a different pattern. Retail media is expected to account for 15.0 percent of category spending in 2027, down from 16.2 percent in 2025.

WARC Media also found that many RMNs depend on a relatively small group of advertisers. In the UK, 73.9 percent of brands spend with three or fewer RMNs. Among eight of the country's largest domestic RMNs, none generates more than a third of its revenue from the bottom 50 percent of brands by spending.

Commerce media expands beyond retail platforms

Amazon’s advertising business outside traditional retail, including Prime Video and Twitch, is projected to generate $6.7 billion in 2027. If treated as a standalone operation, this would make it the world’s second-largest commerce media business outside China, according to WARC Media.

Video-on-demand is forecast to overtake retail media in global advertising investment by 2028. Connected TV already represents 23 percent of retail media spending, while Walmart’s acquisition of Vibe.co points to opportunities for RMNs to bring smaller, performance-focused brands into channels such as CTV.

Ad loads raise shopper experience concerns

As commerce media growth slows and the market consolidates, WARC Media warns that RMNs risk damaging the user experience by prioritising monetisation over shoppers and advertisers.

Research found that Amazon, The Home Depot, Macy’s and Walmart each serve more than 20 ads per page on average. WARC Media recommends that brands and retailers prioritise relevant advertising, reduce clutter and create frictionless on-platform experiences.

Standardised measurement, combined with AI tools supported by robust datasets and consumer insights, could also help RMNs improve advertising relevance and effectiveness.

Retail media creative faces effectiveness challenge

Retail media advertising also faces creative challenges. Research by Ipsos into simulated shopping experiences on Walmart and Amazon found that memory encoding was 47 percent lower for ads shown on retailer platforms than for ads in generic offsite environments.

Among undecided shoppers, high creative quality generated a 12 percent lift in short-term brand choice. For consumers not currently in the market, higher-quality creative delivered a 21 percent performance advantage over lower-quality advertising.

In-store media also presents an opportunity. More than half, or 62 percent, of US grocery buyers say they have purchased a product directly after seeing it on an in-store screen, although WARC Media identifies in-store as one of the less developed creative areas within retail media.

The report concludes that retail media is effective at converting existing demand but less effective at generating long-term brand outcomes. It identifies opportunities for brands to improve creative execution and use commerce media alongside other channels, including creator partnerships and campaigns connecting physical and digital touchpoints.

The Future of Commerce Media 2026 is based on data and insights from WARC and external research. WARC members can read the full report here