Upper limits of retail media's on-site monetization are coming into focus

Just under 80% of all retail media ad spending will be allocated to retailers’ owned and operated digital properties (websites and apps) in 2025. The appeal of on-site formats is strong: Their ad revenues often bring margins north of 70%, according to Boston Consulting Group. On-site ads also benefit from proximity to the point of purchase, making it easy to draw a clean line from impression to conversion. But on-site ad inventory is finite, and its worth to advertisers is inextricably tied to ecommerce traffic, which leaves most retailers at a disadvantage. Further adding to on-site woes, advertisers have begun to question the ROI of ads so close to the bottom of the purchase funnel.

Retail media’s biggest players are maxing out their owned and operated surfaces

Amazon and Walmart show ads to virtually every shopper on virtually every search result page. Collectively, the two powerhouses claim over 80% of retail media ad spending; Amazon comprises three-quarters, and Walmart comes in at a distant second. Both retailers have monetized broad swaths of their websites, with paid results on 99% of product searches and over 20 paid listings per page of search results, according to a November 2024 report by Pentaleap. Other retailers have more room to grow but will need to weigh the need for a positive, seamless user experience against monetization to mitigate shopper fatigue or overwhelm by the volume of ads.

Read the full report, Retail Media's Off-Site Imperative.