By Graham Field, Chief Revenue Officer at Outra
Retail media is one of the fastest-growing advertising channels, forecast to climb to $196.7bn (around £146bn) in 2026, representing 16% of all advertising spend globally. Growth is expected to push total investment beyond $200bn by 2027 as brands increasingly leverage the rich first-party data and outcomes available via retailers.
However, despite investing heavily in the space, brands are missing a trick in their approach.
Much of the current influx of spend into the channel is concentrated within point-of-sale and last-click performance. While this can be effective, anchoring retail media in performance marketing risks narrowing the scope of what can truly be achieved within the channel.
When it comes to retail media, the biggest opportunity lies in shifting from reactive, intent-based tactics to moment-based strategies that are built around real-life context and behaviours. Retail media needs to evolve beyond its purely transactional focus and start playing a broader role in brand-building and the formation of customer relationships.
Rethinking the approach
One of the major contributing factors to retail media’s growth has been the positive shift toward a more privacy-centric digital advertising ecosystem. This move from behaviour-based to context-led marketing helps brands comply with privacy laws, adapt to fewer third-party signals, and deliver greater relevance.
Adopting a moment-based mindset means unlocking the full-funnel potential of retail media. Brands should consider not just where an ad is served but what is happening in the consumer’s life at that moment – something that will have a significant bearing on their likelihood of engaging with a particular campaign.
For example, a consumer could be experiencing one of the most disruptive, emotionally charged, and expensive events they will face in their lifetime – moving home. In the UK, it is estimated that 660,000 households will move in the next six months. That’s a significant number of people who are going to have to think about furniture, appliances, broadband, and all the other factors associated with entering a new abode. Yet most retail media strategies don’t consider these key moments.
Traditional retail media targeting is reactive by design. It relies heavily on search queries, browsing history, and/or purchase intent to reach consumers. The problem is that all of these occur after the consumer has already started on the path to purchase. Where is the retail media engagement happening with the consumer at the upper-end of the funnel?
Home is where the heart is
Household-level predictive data opens the door for leveraging retail media across the entire funnel. By analysing household-level predictive signals such as property data, household composition, life-stage indicators, and historical behavioural trends, brands can accurately identify the consumers most likely to be going through high-impact life transitions.
This would move brands away from solely relying on the customer data held by retail platforms. Instead, marketers can overlay external, privacy-resilient datasets to infer when a consumer is heading toward a high-spend period of their lives, enabling the brand to launch campaigns that are more timely, relevant, and empathetic.
Reaching people ahead of the buying journey also provides brands with a genuine chance to shape consumer preference rather than just capturing demand. If a particular brand isn’t front of mind before the consumer begins the process of buying, say, a washing machine, there’s little room for that brand to convince the person that their brand is worth looking at too.
Every moment matters
Retail media is already a powerful conversion engine – and that rapidly-growing investment in the space only proves its value. However, the future of the channel lies in its capability to serve the entire funnel, becoming a channel that can do as much for brand-building as it can for performance.
By shifting their thinking toward moments, brands can ensure retail media is delivering full-funnel success for them. Aligning campaigns with the real-life needs and decisions that consumers are facing means brands no longer have to wait until the point of purchase to make their mark. Instead, campaigns can be served that engage consumers earlier, build trust over time, and influence the long-term results of the brand.
In a world where brands are competing for dwindling consumer attention, relevance and timing are key to standing out above the competition.
The next generation of retail media success will be defined by the events that truly shape consumer behaviour. To win the race, brands must stop thinking solely in terms of transactions and start shaping everything they do around these moments.
Outra is a client of Bluestripe Group, publisher of Retail Media Age.
