Retailer media to take 18%, $150bn slice of global digital ad market in 2022: GroupM

News 20 Sep 2022 - 3 min read

Retailer media to take 18%, $150bn slice of global digital ad market in 2022: GroupM

By Sam Buckingham-Jones - Deputy Editor

GroupM's Global Director of Business Intelligence Kate Scott-Dawkins and General Manager of Digital Commerce, Sean Bone.

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GroupM has forecast a 15 per cent jump in retailer advertising revenue, globally, and five per cent on top of total e-commerce sales is what to aim for – that’s an estimate of Amazon’s revenue, per the global agency’s recent e-commerce report. Locally, growth is being driven by major supermarkets, but GroupM’s Sean Bone says non-endemic brands will drive longer-term rise in ad revenues.

What you need to know:

GroupM has released its This Year Next Year report focusing on ecommerce, with sections exploring retailer media.
Retailers will make more than A$150 billion from advertising in 2022, the agency estimates.

Retailer media will be a US$101 billion (A$150.44bn) industry in 2022, up from US$88 billion (A$131.07bn) in 2021, with Amazon so far the frontrunner at monetising its advertising inventory, a new GroupM report has found.

Amazon makes 5 per cent of its gross merchandise value – the total value of its online sales – from advertising, while other retailers around the world fall somewhere between zero and 3 per cent, GroupM’s This Year Next Year e-commerce report has found.

“That is a pretty high watermark,” Kate Scott-Dawkins, GroupM’s global director of business intelligence - the author of the report, said. “We see a lot of other retailers in sort of the two to four [per cent] range… scale is needed to get up into that 5 per cent range.”

The report estimated retailer media’s $101bn slice would amount to 18 per cent of global digital advertising and 11 per cent of total advertising.

“We do expect retail media to be taking share within digital going forward. It's going to be one of the fastest growing elements of global advertising over the next five years,” Scott-Dawkins said.

Part of retailer media’s growth has come from the supermarket giants – Woolworths and Coles, for example – that were historically slower to take up media networks as revenue streams.

“Grocery was the laggard. I’ve been working across this space for nearly 10 years and grocery was the poor cousin in many ways of e-commerce,” Sean Bone, GroupM Australia’s Digital Commerce General Manager, said. “But yet it’s now become one of the stickiest parts of it.”

Retail media is intrinsically linked to retail sales, which the report predicted, for Australia, would increase by 8.4 per cent in 2022, down from 24 per cent growth in 2021. It’s also down on the pre-pandemic growth of 15 per cent.

Defining retailer media is challenging. Bone said there is “no audited, standard definition”, and he defines it with a focus on digital that runs through a retailer or marketplace. The biggest growth he foresees is from non-endemic brands – i.e., brands that don’t sell through Woolworths, like travel or automotive companies, buying ad space through Cartology.