The global retail media advertising market is set to cross the USD 200 billion milestone this year, according to WARC Media’s latest report, The Future of Commerce Media 2026, although the sector’s rapid expansion is beginning to moderate as platforms face mounting pressure to balance monetisation with consumer experience. 

Key highlights

•    Global retail media ad investment is projected to reach USD 200.4 billion in 2026 and USD 223.4 billion in 2027, when it will account for 15.2% of worldwide advertising spend.
•    Excluding Amazon, global retail media growth is forecast to slow to 9.8% in 2027, marking the lowest year-on-year growth rate since WARC Media began tracking the sector.
•    A simulated shopping study on Amazon and Walmart found that memory encoding fell by 47% for ads appearing on retailer platforms compared to generic off-site environments.
•    Among undecided shoppers, high-quality creative delivered a 12% lift in short-term brand choice, underlining the growing importance of creativity in commerce media effectiveness.
•    Retail media is expected to command more than half of media budgets in several CPG categories, including 55.8% for alcoholic drinks and 54.9% for food brands globally by 2027.

The report projected worldwide retail media investment to reach USD 200.4 billion in 2026 before rising 11.5% year-on-year to USD 223.4 billion in 2027. By then, retail media would account for 15.2% of total global advertising expenditure, cementing its position as one of the industry’s largest and fastest-growing media channels.

However, WARC warned that beneath the headline growth figures, momentum was slowing. When Amazon’s advertising business was removed from the equation, global retail media growth was expected to decline to 9.8% in 2027 - the lowest annual growth rate recorded since WARC Media began monitoring retail media investment.

The finding highlighted the extent to which Amazon continued to drive the category’s expansion and underscored increasing consolidation across the market.

The report also pointed to the growing concentration of advertising investment among dominant platforms. In the US, Amazon captured 78% of all retail media expenditure in 2025, compared with Walmart’s 7.5%, leaving just 14.5% for all remaining retail media networks combined.

A similar pattern was evident across Europe, where Amazon accounted for more than two-thirds of total retail media spend across major markets including the UK, Germany, France, Italy and Spain.

Despite this concentration, retail media was becoming increasingly central to category marketing budgets. WARC forecast that by 2027, alcoholic drinks brands would allocate 55.8% of their total media investment to retail media, while food brands would devote 54.9%. Technology and electronics, however, were expected to remain comparatively less dependent on the channel, with retail media accounting for 15% of category spend.

One of the report’s strongest findings concerned the effectiveness of advertising within retail environments themselves.

Research conducted by Ipsos using simulated shopping experiences on Amazon and Walmart found that memory encoding dropped by 47% for advertisements appearing on retailer platforms compared with ads seen in generic off-site digital environments.

The research suggested that shoppers navigating commerce platforms were significantly less likely to retain advertising messages amid the highly transactional environment. Creative quality, therefore, emerged as a critical differentiator. WARC found that among undecided shoppers, stronger creative generated a 12% lift in short-term brand choice, while among consumers not currently in the market, high-quality advertising delivered a 21% performance advantage over lower-quality creative.

The findings reinforced the report’s broader argument that commerce media could not rely solely on proximity to purchase and required stronger creative execution to improve effectiveness.

The report also raised concerns around what it described as the potential “enshittification” of commerce media — a term coined by technology writer Cory Doctorow to describe digital platforms that gradually degrade user experience in pursuit of monetisation.

As retail media networks pursued increasingly ambitious revenue targets amid slower growth, platforms risked overwhelming shoppers with excessive advertising. Research cited in the report found that Amazon, Walmart, Macy’s and The Home Depot each served more than 20 advertisements per page on average.

WARC cautioned that rising ad loads could compromise both shopper experience and campaign effectiveness if relevance and usability were sacrificed for revenue. Rather than increasing advertising clutter, the report recommended that retailers build frictionless on-platform experiences centred on relevance, standardised measurement and stronger use of AI supported by robust consumer datasets.

The report also identified opportunities beyond traditional retail advertising. Connected TV already represented 23% of retail media spend, while Walmart’s acquisition of Vibe.co was cited as an example of how retail media networks could help smaller performance-focused brands enter television advertising through more accessible commerce-led ecosystems.

Meanwhile, Amazon’s advertising ambitions continued to extend beyond retail. Its non-retail advertising business, spanning Prime Video and Twitch, was projected to generate USD 6.7 billion in 2027 — exceeding Walmart’s total advertising revenue in 2025 and positioning it as the world’s second-largest commerce media operation outside China if treated as a standalone business.

Alex Brownsell, content - head, WARC Media, said, “The retail media landscape is maturing and consolidating, forcing marketers to rethink their approach. While retail media excels at converting existing demand, it underperforms on long-term brand building. Retailers face a delicate balancing act: growing ad revenue to boost margins without overwhelming shoppers with too many ad interruptions that compromise both shopper experience and campaign effectiveness. Success now depends on smart integration with other channels and finding the optimal path to sustainable results.”