Retail's Quiet Disruption: Why Retail Media Networks Are Becoming the Operating Systems of Commerce (And Why Amazon Should Be Worried)
When 10x ROAS Means Nothing
Something strange is happening in the world of retail media. While everyone's fixated on the $179.5 billion headline number for 2025, they're missing the real story. The 200+ retail media networks operating globally aren't just creating new ad inventory—they're fundamentally rewiring how commerce works. And the implications go far beyond marketing budgets.
The Amazon Paradox That Nobody Wants to Talk About
Why AI Agents Don't Care About Prime
Here's an uncomfortable truth: Amazon controls 75% of retail media spend, but that dominance is built on a foundation that's starting to crack. Not because Amazon is failing—they're not. But because the very assumptions that made them dominant are becoming obsolete.
Think about it: Amazon's retail media empire is built on three pillars:
Marketplace dependency (third-party sellers who HAVE to advertise there)
Prime loyalty lock-in
Unmatched logistics infrastructure
But what happens when AI agents start shopping for consumers? They don't have Prime loyalty. They don't care about two-day shipping if someone else offers three-day for 30% less. They certainly don't browse—they parse.
The Walmart Vizio Play That Changes Everything
I recently watched a demo where an AI agent was given a simple task: buy the best value paper towels. It completely ignored Amazon's sponsored products, compared unit prices across seven retailers in milliseconds, and ultimately chose a wholesale club the user had never heard of. Amazon's sophisticated ad targeting? Worthless. Their premium shelf placement? Invisible.
This is Amazon's nightmare scenario, and it's why Walmart's acquisition of Vizio is genius. They're not trying to beat Amazon at Amazon's game. They're building an entirely different game where the rules favor them.
The Data Collaboration Theater That's Actually Shakespeare
Inside the "Dirty Data Alleys"
Every retail media conference I attend has the same panel: "The Future of Data Clean Rooms." Everyone nods sagely about privacy-safe collaboration while secretly hoping their competitors' data strategies fail. But here's what's actually happening in those clean rooms: absolutely nothing interesting.
The real action is in what I call "dirty data alleys"—the unregulated spaces where retailers and brands are striking bilateral deals that would make privacy advocates weep. One CPG brand I know is literally embedding their data scientists inside a major retailer's headquarters. Not using a clean room. Not following IAB guidelines. Just raw, unfiltered data access with a handshake agreement.
Why Bilateral Beats Multilateral Every Time
Is it sustainable? No. Is it legal? Barely. Is it working? You bet.
The companies winning at retail media aren't the ones with the best clean room technology. They're the ones who've figured out that in a world of 200+ RMNs, bilateral relationships beat multilateral frameworks every time. While everyone else is waiting for standards, they're cutting deals.
The Creative Crisis Nobody Saw Coming
When Boring Beats Beautiful
Here's a stat that should terrify agencies: Less than 2% of retail media budgets go to creative. Everyone's so obsessed with targeting, data, and attribution that they forgot something crucial: somebody still has to make the ads.
But here's where it gets interesting. The most successful retail media campaigns I've seen recently didn't look like ads at all. They looked like product information. One pet food brand increased their Chewy sales by 67% by replacing their emotional "happy dog" creative with pure nutritional data visualizations. Boring? Yes. Effective? Absolutely.
The Information Architecture Revolution
This is the paradox of retail media creative: The closer you are to the point of purchase, the less "creative" you need to be. In fact, traditional creativity might actually hurt conversion. When someone's on Walmart.com comparing prices, they don't want storytelling. They want specifications.
One RMN executive told me, "We're not in the advertising business anymore. We're in the information architecture business." And that changes everything about how brands need to think about their retail media creative strategy—if you can even call it "creative" anymore.
The Self-Service Myth That's Costing Millions
Why "Easy" Is Actually Expensive
Everyone's racing to launch self-service platforms. The Home Depot's Orange Access, Walmart Connect's self-serve options—it's the gold standard, apparently. But here's what nobody's saying: Self-service is making retail media worse, not better.
Why? Because self-service platforms are designed for efficiency, not effectiveness. They're built to make it easy to spend money, not to make money. I analyzed 50 self-service retail media campaigns last quarter. The average ROAS? 1.8x. The average for managed service campaigns? 4.2x.
The Hidden Cost of Automation
The dirty secret is that retailers know this. They're pushing self-service not because it's better for advertisers, but because it's better for their margins. No account management costs, no strategic consulting, just pure algorithmic profit.
Smart brands are doing the opposite of what retailers want: They're demanding MORE managed service, not less. They're hiring retail media specialists whose only job is to manage these "self-service" platforms. They're treating self-service as an API, not a solution.
The Measurement Shell Game Everyone's Playing
When 10x ROAS Means Nothing
Retail media measurement is a joke, and everyone knows it. When Kroger reports a 10x ROAS and Target reports 8x for the same campaign, something's broken. But here's the thing: Nobody actually wants to fix it.
Retailers don't want standardized measurement because inflated metrics help them capture more budget. Brands don't want it because they can cherry-pick whatever numbers make them look good to their CFO. Agencies don't want it because confusion creates consulting opportunities.
The Trade Promotion Truth
So we're stuck in this measurement theater where everyone pretends the numbers mean something while making decisions based on entirely different criteria. The smartest performance marketers I know have given up on RMN-reported metrics entirely. They're running their own incrementality tests, building their own attribution models, and treating platform metrics as directional indicators at best.
One CMO told me, "I budget for retail media like I budget for trade promotions—as a cost of doing business, not a performance channel." That's heretical in marketing circles, but it might be the most honest thing anyone's said about retail media.
The Non-Retail Retail Media Networks That Will Eat Everyone's Lunch
Chase Media's Transaction Advantage
While retailers are fighting over who has the better clean room, non-retail companies are building retail media networks that make traditional RMNs look antiquated.
Chase Media Solutions doesn't sell products, but they see every transaction. They know what you buy, where you buy it, and how much you spend. Their retail media network isn't built on browsing behavior—it's built on actual purchase data across the entire economy. That's terrifying if you're a traditional retailer.
The Coming Non-Endemic Wave
United Airlines just launched a retail media network. Hotels are launching them. Your local electric utility probably has one in development. The distinction between "retail" media and "media" is disappearing, and the implications are staggering.
These non-endemic networks have advantages traditional retailers can't match:
No channel conflict (they're not competing with their advertisers)
Broader data sets (cross-category purchase behavior)
Different inventory (airport lounges, hotel rooms, monthly bills)
Less pricing pressure (their core business isn't retail margins)
By 2027, I predict non-retail RMNs will capture 30% of what we currently call "retail media" spend. And traditional retailers won't see it coming until it's too late.
The Partnership Paradox That's Breaking Brands
Death by 47 Platforms
Brands are drowning in RMN partnerships. I talked to one CPG company that's actively managing campaigns on 47 different retail media networks. Forty-seven! They have more retail media managers than brand managers.
But here's the insane part: They're spending 80% of their budget on just three networks. The other 44? They're maintaining them "for strategic relationships." They're literally lighting money on fire to keep retailers happy.
The Hidden 40% Tax
This is the hidden cost of retail media proliferation. It's not just the media spend—it's the operational overhead of managing dozens of relationships, platforms, and reporting frameworks. One brand calculated that their cost of managing retail media (headcount, technology, agency fees) equals 40% of their actual media spend.
The smart brands are starting to say no. They're consolidating spend on fewer networks and going deeper with those partners. They're treating retail media like key account management, not democratic ad buying. And they're probably right.
The Endgame Nobody's Preparing For
From Ad Networks to Commerce Operating Systems
Here's my prediction: Within three years, retail media networks won't exist as we know them. Not because they'll disappear, but because they'll become something else entirely—commerce operating systems.
The winning retailers won't be the ones with the best ad platforms. They'll be the ones who build entire ecosystem layers that brands can't operate without. Inventory management, demand forecasting, dynamic pricing, supply chain optimization—all powered by the same data that currently drives retail media.
The Tenant Trap
Walmart's already heading this direction with their Luminate platform. Amazon's been doing it for years with their various seller tools. But most retailers are still thinking about retail media as an ad business rather than an infrastructure play.
The brands that survive this transition will be the ones that stop thinking about retail media as advertising and start thinking about it as commerce architecture. The ones that don't? They'll wake up one day to find they're not advertisers anymore—they're tenants.
The Only Strategy That Makes Sense
Three Rules for Survival
Given all this chaos, what should brands actually do? Here's my advice:
Stop treating retail media like digital advertising. It's not. It's trade marketing with better data. Budget for it accordingly, measure it differently, and stop expecting it to act like Facebook ads.
Pick your winners now. You can't win on 200 platforms. Choose the 3-5 that matter for your business and go all-in. Let your competitors waste resources trying to be everywhere.
Build for the post-RMN world. Start thinking about what happens when retail media evolves beyond ads. How will you compete when retailers control not just the shelf, but the entire customer journey?
Most importantly, stop playing by their rules. The retailers want you to think retail media is essential. Maybe it is. But that doesn't mean you have to accept their version of how it should work.