Growth in retail media search ad spend will outpace its traditional counterpart

Article by Meaghan Yuen | Jun 25, 2024

Key stat: Advertisers will increase their spend on US retail media search ads every year of our forecast period until 2028, when it will see its most growth at 23.4% YoY, according to our March 2024 forecast. Over the same time period, traditional search ad spending growth will decline, slowing to 0.9% in 2028.

Beyond the chart:

Retail media search ad spend will reach $33.86 billion this year, and more than double by 2028 when it will hit $76.83 billion, per our forecast.
Google’s rollout of AI Overviews, a feature that answers queries directly on the search engine results page, may drastically compromise clickthrough rates and, consequently, the traditional search ad industry.
Although retailers are also experimenting with AI integrations in retail media search ads, they are likely to see less of a drop in clickthrough rates due to their closeness to the point of purchase.

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Note: Examples of websites or apps primarily engaged in retail ecommerce include Amazon, Walmart, and eBay; examples of retail media networks include Amazon's DSP and Etsy's Offsite Ads.

Methodology: Estimates are based on the analysis of various elements related to the ad spending market, including macro-level economic conditions, historical trends of the advertising market, historical trends of each medium in relation to other media, reported revenues from major ad publishers, estimates from other research firms, data from benchmark sources, consumer media consumption trends, consumer device usage trends, and eMarketer interviews with executives at ad agencies, brands, media publishers, and other industry leaders.