Retail media networks are advertising businesses run by retailers and marketplaces that sell ad space on their websites, apps, stores and partner channels, targeted with their own shopper data. Amazon Ads, Walmart Connect and Flipkart Ads are the best-known examples, and in India, quick commerce apps such as Blinkit, Zepto and Swiggy Instamart have become major ad platforms too.
The appeal is simple: the ad runs where people are about to buy, and the retailer can connect the ad to the actual sale. This guide explains how retail media works, the difference between on-site, off-site and in-store ads, how closed-loop measurement really works, the formulas that matter (ROAS, ACoS, TACoS and iROAS), and how to plan a retail media budget.
Key takeaways
- Retail media is advertising sold by retailers, using their first-party shopper data, on their own properties and beyond.
- Commerce media is the wider term. It also covers delivery apps, travel sites, payments and other companies with transaction data.
- In the US, commerce media ad revenue reached $63.4 billion in 2025, up 18%, according to the IAB and PwC.
- Closed-loop measurement links ad exposure to purchases, but attributed sales are not the same as incremental sales.
- Plan budgets from share of sales by retailer, then shift money towards the networks with the best incremental return.
What is a retail media network?
A retail media network is a retailer’s in-house advertising business. It sells sponsored product listings, display banners, video and in-store screens on its own properties, and often buys ads on other websites and apps too, all targeted with the retailer’s purchase data. Brands pay to appear at or near the point of purchase.
The IAB and MRC’s retail media measurement guidelines define retail media as marketing to consumers near their point of purchase or choice between brands or products, both online and in stores. The most common format is the sponsored product ad: a paid listing that looks like a normal search result, labelled as sponsored, and charged per click.
What is the difference between retail media and commerce media?
Retail media is sold by retailers and marketplaces that sell products, such as Amazon, Walmart or Flipkart. Commerce media is the wider category: any company with shopping or transaction data selling ads, including food delivery, ride-hailing, travel booking and payments apps. All retail media is commerce media, but not all commerce media is retail.
The market is large and still growing. The IAB and PwC internet advertising revenue report found US commerce media revenue grew 18% in 2025 to $63.4 billion, which was 21.5% of all US digital ad revenue. The main drivers are easy to see:
- First-party data. Retailers know what people actually bought, not just what they browsed.
- Closed-loop measurement. They can report sales from the same system that served the ad.
- Point of purchase. Shoppers are already in a buying mood, so conversion rates are high.
- Retailer economics. Ad revenue carries much higher margins than selling products.
Which retail media networks matter most, globally and in India?
Globally, Amazon Ads is by far the largest, followed by Walmart Connect and networks such as Target’s Roundel, Kroger Precision Marketing and Instacart Ads. In India, Amazon Ads and Flipkart Ads lead e-commerce, while Blinkit, Zepto and Swiggy Instamart sell ads on quick commerce.
| Network | Market | Typical on-site formats | Beyond the store |
|---|---|---|---|
| Amazon Ads | Global, including India | Sponsored Products, Sponsored Brands, display, video, Brand Stores | Amazon DSP, streaming TV (including Prime Video), audio, devices |
| Walmart Connect | US and other Walmart markets | Sponsored search, onsite display, sponsored videos | Offsite media, in-store screens |
| Roundel (Target) | US | Sponsored products, display | Offsite media with Target data |
| Kroger Precision Marketing | US grocery | Sponsored search, display | Offsite media, in-store |
| Instacart Ads | US and Canada grocery delivery | Sponsored products, display, video | Offsite and retailer partner sites |
| Flipkart Ads | India | Sponsored product listings, display and brand ads | Check current off-site options |
| Blinkit, Zepto, Swiggy Instamart | India quick commerce | Sponsored search and category listings, banners, brand campaigns | Limited, mostly in-app |
eMarketer forecasts that Amazon’s retail media revenue will exceed $75 billion by 2028, more than $65 billion ahead of the next-largest network. Product names change often. Check each network’s own ad centre before you plan. For example, Amazon Ads lists its products across sponsored ads, brand stores, video, audio, display and out-of-home, and Walmart Connect groups its offer into sponsored search, onsite display, offsite media and store ads.
What is the difference between on-site, off-site and in-store retail media?
On-site ads run on the retailer’s own website or app, such as sponsored products in search results. Off-site ads use the retailer’s shopper data to target people on other websites, apps, social platforms and connected TV. In-store ads run on screens, shelves, audio and checkout inside physical stores. Measurement is strongest on-site and weakest in-store.
| Type | Where it runs | Best for | Typical pricing | Measurement strength |
|---|---|---|---|---|
| On-site search | Retailer search results | Capturing demand, launches in a category | Cost per click (auction) | High |
| On-site display and video | Home page, category pages, product pages | Consideration, cross-selling | CPM or CPC | High |
| Off-site | Other sites, apps, social, CTV via retailer data | Reaching shoppers before they visit | CPM via a DSP | Medium |
| In-store | Screens, shelf, audio, sampling | Impulse and local promotions | Flat fee or CPM | Lower, improving |
Off-site retail media is usually bought programmatically. If DSPs and deal types are new to you, read our guide to programmatic advertising, DSPs and PMPs first.
How does closed-loop measurement work in retail media?
Closed-loop measurement matches people who saw or clicked an ad to the purchases they later made with the same retailer, using logged-in accounts or loyalty IDs. The retailer then reports attributed sales within a set lookback window. It is precise about who bought, but it counts sales that would have happened anyway unless you test for incrementality.
The IAB and MRC guidelines note that typical attribution windows are 3, 7, 14, 28 or 30 days, and ask networks to disclose them in advance. They name randomised controlled trials as the gold standard for incrementality. Three questions to ask any network:
- What is the attribution window, and is it click-based or view-based? A 14-day view window will credit far more sales than a 7-day click window.
- Are halo sales included? Some reports count purchases of any product from your brand, not only the advertised one.
- Can we run a holdout test? A group that is not shown ads tells you how many sales are truly incremental.
How do you measure retail media: ROAS, ACoS, TACoS and iROAS?
ROAS is attributed sales divided by ad spend. ACoS, used on Amazon, is ad spend divided by attributed sales. TACoS is ad spend divided by total sales, including organic. iROAS is incremental sales divided by ad spend. Plan on iROAS and profit, because ROAS and ACoS include sales you would have made anyway.
Formula: ROAS = Attributed sales ÷ Ad spend
Formula: ACoS (%) = Ad spend ÷ Attributed sales × 100
Formula: TACoS (%) = Ad spend ÷ Total sales (ad plus organic) × 100
Formula: iROAS = Incremental sales ÷ Ad spend
Worked example: a skincare brand on a marketplace
Example: a skincare brand spends $2,000 in a month on sponsored product ads. The platform reports $10,000 in attributed sales. Total sales on that marketplace, including organic, are $25,000. Gross margin after marketplace fees is 30%.
| Metric | Calculation | Result |
|---|---|---|
| ROAS | 10,000 ÷ 2,000 | 5.0 |
| ACoS | 2,000 ÷ 10,000 × 100 | 20% |
| TACoS | 2,000 ÷ 25,000 × 100 | 8% |
| Incremental sales (holdout shows 40% incremental) | 10,000 × 0.40 | $4,000 |
| iROAS | 4,000 ÷ 2,000 | 2.0 |
| Incremental gross profit | 4,000 × 0.30 | $1,200 |
| Short-term profit after ad spend | 1,200 minus 2,000 | minus $800 |
A ROAS of 5 looks excellent, yet the campaign loses $800 in the short term once you count only incremental sales and real margin. It may still be worth running if it builds ranking, reviews and repeat purchases, but that should be a conscious choice. Check your per-unit margins with the free Amazon FBA profit calculator before you set a target ACoS.
Formula: Break-even ACoS (%) = Gross margin before ad spend (%)
If your margin is 30%, any ACoS above 30% loses money on attributed sales, and the true break-even is lower once you account for non-incremental sales.
How do quick commerce ads work on Blinkit, Zepto and Instamart?
Quick commerce apps sell sponsored placements in search results and category listings, plus banners and brand takeovers, to brands stocked in their dark stores. Because delivery runs from local stores, an ad only works where your product is in stock. Plans are built by city and pin code, and search terms and time of day matter a lot.
- Stock first, ads second. An ad for an out-of-stock product in a dark store wastes money and hurts ranking.
- Win the search term. Baskets are small and fast. Most purchases start from a search like “milk”, “chips” or “face wash”.
- Plan by city. Split budgets by city where your distribution and sales are strongest.
- Use moments. Evenings, weekends, festivals and cricket matches change what people order.
- Watch automatic settings. Check campaign settings and reports closely, and ask for clear definitions of attributed sales.
How should you plan a retail media budget?
Start with how much of your sales each retailer drives, then set a retail media budget for each as a target share of those sales, often expressed as TACoS. Weight the split towards networks with better incremental returns and margins. Keep some budget for off-site and upper-funnel activity so retail media does not only harvest existing demand.
Example: a D2C snack brand has $10,000 a month for retail media. Its online sales split and the planned adjustment look like this:
| Channel | Share of online sales | Budget by sales share | Adjusted budget | Reason for adjustment |
|---|---|---|---|---|
| Amazon | 40% | $4,000 | $3,000 | Mature listings, high organic rank |
| Flipkart | 25% | $2,500 | $2,500 | In line with sales |
| Blinkit | 15% | $1,500 | $1,800 | Fast growth, strong impulse category |
| Zepto and Instamart | 10% | $1,000 | $1,100 | Expanding city coverage |
| Own website | 10% | $1,000 | $600 | Better served by search and social |
| Total | 100% | $10,000 | $9,000 | $1,000 kept for tests and off-site |
Retail media budgets often come from trade marketing money agreed with the retailer, not only from brand budgets. Decide upfront who owns them. For the wider question of total budget size, see our guide on how to set an advertising budget.
Common retail media mistakes
- Treating ROAS as profit. Attributed sales include organic and repeat buyers who would have purchased anyway.
- Bidding on your own brand name with no test. Some spend is defensive and worth it, but test how much.
- Ignoring availability. No stock, no sale, especially on quick commerce.
- Comparing networks with different windows. A 14-day view-through ROAS and a 7-day click ROAS are not the same number.
- Only buying bottom-funnel search. Without off-site and brand activity, you end up paying to capture demand that shrinks over time.
What this means for marketers and creators
For marketers
- Report TACoS and iROAS by retailer every month, not only ROAS.
- Run at least one holdout or geo test per major network per year.
- Agree attribution windows and halo rules with each network before the campaign starts.
- Link retail media plans to stock and distribution data so ads switch off where products are unavailable.
For creators
- Creators who sell their own products on marketplaces should track TACoS: if it keeps rising, ads are replacing organic sales, not adding to them.
- Brands buying retail media also want off-site reach. Creator content is often used as the creative for sponsored video and shoppable formats, so pitch it that way.
- Affiliate and storefront programmes on marketplaces sit next to retail media. Know which one pays you, and how each is tracked.
Frequently asked questions
What is a retail media network?
A retail media network is an advertising business run by a retailer or marketplace. It sells ad space on its website, app, stores and partner channels, and targets those ads using its own shopper and purchase data. Amazon Ads, Walmart Connect and Flipkart Ads are well-known examples. Brands usually pay per click or per thousand impressions.
What is the difference between retail media and commerce media?
Retail media is sold by retailers and marketplaces that sell products. Commerce media is the broader term for any company with transaction data that sells ads, including food delivery, ride-hailing, travel and payments apps. Retail media is part of commerce media. Both rely on first-party data and closed-loop measurement to link ads to purchases.
What is off-site retail media?
Off-site retail media uses a retailer’s shopper data to target ads outside the retailer’s own site or app, on other websites, apps, social platforms and connected TV. It is usually bought through a demand-side platform. It helps brands reach shoppers before they visit the store, but measurement is less precise than for on-site sponsored product ads.
What is closed-loop measurement in retail media?
Closed-loop measurement links ad exposure to actual purchases made with the same retailer, using logged-in accounts or loyalty IDs. The retailer reports sales within a set attribution window, such as 7 or 14 days. It is precise, but it also counts purchases that would have happened anyway, so holdout tests are needed to measure incremental sales.
What is a good ACoS on Amazon?
A good ACoS is below your gross margin before ad spend. If your margin is 30%, an ACoS above 30% loses money on attributed sales. Many brands accept a higher ACoS during a launch to build ranking and reviews, then lower it. Track TACoS as well, which divides ad spend by total sales including organic.
How do brands advertise on Blinkit and Zepto?
Brands stocked on Blinkit, Zepto or Swiggy Instamart can buy sponsored placements in search results and category listings, plus banners and brand campaigns, usually through the platform’s ad team or self-serve tools. Because orders are fulfilled from local dark stores, ads should be planned by city and only run where the product is in stock.
Next steps
Before you raise retail media budgets, work out your true margin per unit with the TechMachaw Amazon seller tools, then set target ACoS and TACoS from it. For definitions of ROAS and other performance metrics, see the media planning glossary.
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