In the advertising ecosystem, retail media networks (RMNs) are positioning themselves as a lucrative avenue for brands and retailers. According to Retail 2025: 10 Trends Shaping the Retail Media Market, a report by Coresight Research sponsored by Criteo, the global retail media market is projected to reach $179.5 billion by 2025, representing an annual growth rate of 15.4%. While these figures indicate significant promise, the report also underscores the mounting challenges facing RMNs as competition heats up and expectations rise.

What does RMN mean? An RMN  is when retailers use their own websites and apps to show ads to customers based on the data they collect about shopping habits. It allows brands to target specific customers more effectively, while retailers make extra money by selling ad space on their digital platforms. Think of it as retailers turning their online presence into an advertising space for brands.

The profitability puzzle

The report claims that onsite RMNs could achieve gross margins as high as 70%, making them a potentially high-reward venture for retailers. Flipkart, for instance, has reportedly leveraged its first-party data to craft targeted, localised ad campaigns tailored to India’s diverse consumer base. By employing artificial intelligence (AI) and machine learning, the platform enhances ad performance while driving higher returns.

Globally, similar trends are evident. Amazon’s AI-powered Video Generator and Gopuff’s personalised ad-targeting platform exemplify how advanced technologies are reshaping the retail media landscape. These innovations reportedly enable advertisers to optimise campaigns in real time, tapping into consumer preferences with greater precision.

“Retailers that are seeing the most growth and that have been able to ride out the inflation storm and pullback of consumer spending with the least impact are those who have intelligently diversified their revenue streams and that have invested in developing advanced retail media networks,” Deborah Weinswig, CEO, Coresight, said.

Technology: The driving force

AI, as highlighted in the report, is at the forefront of RMN innovation. It allows for next-generation ad automation and personalisation, using real-time behavioural and transactional data to customise content at scale. Programmatic advertising complements this by automating ad placement across multiple RMNs, reportedly improving operational efficiency and campaign performance.

“In recent years, Martech has evolved from isolated tools into interconnected ecosystems, enabling seamless omnichannel experiences and personalized customer engagement. According to a new report by Coresight Research sponsored by Criteo, Retail 2025: 10 Trends Shaping the Retail Media Market, the global retail media market will total $179.5 billion in 2025. We believe advancements in AI, automation, and data-driven personalization will drive Martech’s transformation, powering the next wave of retail media growth. AI algorithms will optimize bidding strategies, enable real-time campaign adjustments, and enhance ad spend efficiency—shifting focus from impressions to measurable outcomes. Moreover, predictive analytics and machine learning will further empower brands to anticipate consumer behavior, refine messaging, and deliver impactful, personalized advertising and product recommendations” said Medhavi Singh, Country Head, Criteo India.

The diversification of ad formats is another trend cited in the report. From digital coupons to connected TV (CTV) ads, RMNs are increasingly catering to evolving consumer preferences. Examples include Currys and Roku using CTV to engage streaming households and Instacart partnering with Ibotta to integrate digital coupons directly at checkout. These developments reflect the industry’s shift toward more interactive and engaging advertising solutions.

Market shifts and consumer insights

Coresight Research emphasises the transformative potential of RMNs as full-funnel advertising tools, allowing brands to seamlessly connect with consumers across various touchpoints. By leveraging first-party data and closed-loop attribution, retailers reportedly gain deeper insights into campaign effectiveness and consumer behaviour.

In India, this is particularly relevant as digital shopping adoption accelerates. The report suggests that RMNs will play an increasingly central role in bridging online and offline shopping experiences. However, trust and transparency remain critical as data privacy regulations tighten globally. Measurement standardisation, another focus of the report, is reportedly gaining momentum, with advertisers demanding clearer metrics to assess their return on investment.

Competitive pressures

The report warns that the intensifying competition among RMNs could challenge their ability to maintain differentiation. Partnerships with platforms like Google and Vizio, as seen with Instacart and Walmart, are reportedly aimed at expanding ad reach and creating cross-platform advertising ecosystems.

Emerging RMNs, with their innovative and agile solutions, are also expected to disrupt the ecosystem. For Indian retailers, the opportunity to capitalise on a growing digital-savvy consumer base is significant, but so are the risks of falling behind in innovation and differentiation.

A cautious optimism

The figures and trends outlined in Coresight Research’s report paint a picture of immense potential for RMNs, but they also reveal a double-edged sword. While high margins and technological advancements offer promising prospects, the challenges of sustaining innovation, fostering trust, and navigating an increasingly competitive market are substantial.

As the retail media market edges closer to its projected $179.5 billion valuation in 2025, the question remains: will RMNs solidify their role as a cornerstone of advertising, or will they falter under the weight of heightened expectations? According to the report, the next few years will be critical in determining whether RMNs can deliver sustainable value in an ever-changing advertising landscape.