Lindsey Mazza, Global Retail Lead at Capgemini, guides retailers on integrating tech in supply chain, sales and marketing transformations.
Last year, an estimated one-fifth of all global digital ad spend went to retail media networks (RMNs)—advertising platforms owned and operated by retailers. This year, that figure is likely to grow further, as 68% of global marketers say RMNs are more important to their media strategy than they were the previous year.
Despite this momentum, marketers may soon hit an unexpected snag: Generative and agentic AI tools are reshaping how people discover and buy products, disrupting established marketing and advertising practices, including RMNs.
In this new landscape, retailers must ensure that their RMN experience delivers the same intuitive, intelligent and highly relevant engagement that consumers are quickly coming to expect from AI-powered tools. At the same time, they must also craft a strategy that delivers strong value to brand partners and unlocks the retailer’s own top-line growth.
To achieve a win for consumers, brands and retailers need to embrace a multidimensional approach that prioritizes three essential pillars: capability, contextualization and channels. These are the building blocks that will help retailers fulfill the promise of their RMNs—not just as a media platform, but as a growth engine.
Capability, Contextualization And Channels: The Making Of An Effective RMN Strategy
1. Leverage advanced technologies to strengthen core RMN capabilities.
RMN campaigns share the same components as conventional advertising: great creative, smart analytics, automated marketing execution. As with any ad, the goal is to match the right product with the right consumer at the right time and on the right channel. But one key difference between traditional ads and RMNs is scale.
Unlike TV or print campaigns that generally feature a limited number of creative variations adapted across key markets, RMNs often run hundreds—or even thousands—of ads in a single week. For retailers, this volume requires an incredible amount of effort to develop, plan and execute, not to mention the corresponding expertise to do it effectively.
Realistically speaking, the only way that retailers can execute RMN campaigns cost-effectively at scale is by embracing generative and agentic AI tools. These technologies help enable more informed decision-making and automate just about every part of the process, allowing teams to focus on the outlier tasks and cases that require human attention and insight.
For example, our team is working with one leading retailer to incorporate AI into their retail media processes to deliver hundreds of customized media campaigns and thousands of creatives per month. Through the use of AI and automation, this retailer increased creative operation speed by more than 40%, reduced time to market by 20% and lowered operational costs by 45%.
2. Create strong customer relationships through deep contextualization.
When it comes to RMNs, scale—the number of consumers the network serves—and reach—the distinctiveness of that audience—are quickly becoming table stakes. What matters even more today is how brands engage their unique audience.
Unfortunately, many retailers have some work to do in this area. Consumer research recently conducted by the Capgemini Research Institute revealed that 6 in 10 consumers (59%) say RMN ads are “very generic” and don’t serve their specific needs. As AI tools reset consumer expectations, personalization, which has long been the benchmark of effective advertising, is now being replaced by contextualization—leveraging advanced analytics and AI to deliver timely, emotionally intelligent experiences.
Unlike personalization, contextualization goes beyond static attributes like age or income to consider real-time signals, like what a shopper just watched, what they’re doing online, how they might be feeling or what their plans are tomorrow. For example, a grocer could use predictive analytics and AI tools to identify health-conscious millennial parents as a high-propensity segment for plant-based snacks.
By understanding what messaging resonates with that micro-community—like sustainability and family wellness—as well as timely factors that may influence their buying patterns—such as the need for more fast and healthy snacks to have around the house during the summer months—they can serve targeted offers that more closely align with the real-time needs of shoppers.
3. Incorporate physical channels into the RMN strategy to capture a bigger audience.
Although much of the conversation around retail media focuses on digital channels, less than 10% of sales in categories like food, beverage and household essentials are happening online. That leaves a massive 90% of purchase volume still occurring in-store—an opportunity that many retail media strategies don’t fully capitalize on.
The missed opportunity becomes even more acute considering that consumers are receptive to in-store ads. Our recent research found that 53% of shoppers welcome personalized in-store ads delivered through smart displays, such as via shopping carts, smart mirrors or embedded touchscreens.
Tapping into the in-store opportunity means rethinking how media is delivered in physical retail environments. For example, retailers can add digital ad screens to various points around the store, including on shelves, high-traffic end caps or on cooler doors.
Or retailers can go even bigger by taking a note from Tesco, which launched the option for brands to run full “store wrap” ads in 50 locations. Sam’s Club, meanwhile, introduced display ads in their Scan & Go mobile app to help members more easily discover and find products while they shop in-club. Our research shows that in-store ads like these are driving value for consumers, brands and retailers with 32% of shoppers saying in-store ads help them discover new products.
Seizing The RMN Opportunity In The AI Era And Beyond
Ad spending on RMNs is projected to grow by 25% per year over the next five years, reaching a market value of $100 billion. By the end of 2026, it is expected to account for more than one-quarter of total digital media spending.
But as generative and agentic AI tools continue to reshape consumer behaviors and expectations, retailers must move beyond the legacy RMN playbook. The next phase of RMN success won’t only be driven by scale or reach—but also by smart execution rooted in capability, contextualization and channel strategy.
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