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US retail media ad spend will pass $30 billion for the first time this year

The forecast: US retail media ad spend will hit $31.49 billion in 2021, up 53.4% over 2020. By 2023, this figure will pass $50 billion, with the vast majority of retail media ad spend coming from ecommerce channels.

Dive deeper:

  • Ecommerce channel ad spend will account for 89.7% of total retail media spend in 2021. That figure will shrink to 86.3% in 2023 as retail media networks become a high-growth opportunity.
  • Ecommerce retailers are looking to shift to monetizing off-site advertising, both on other parts of the internet and on connected TV devices.
  • Amazon is a leading indicator of this trend, while other retailers like Walmart, Etsy, and eBay are newly venturing toward off-site advertising. Given that this form of revenue is new for these companies, it'll take time for them to build up these businesses to complement their on-site advertising.

Looking ahead: Retail media advertising will continue to be one of the fastest-growing segments of US digital advertising through 2023, with growth continuing in the double digits. Retail media will also increase as a share of total US digital ad spend, hitting 19.3% in 2023.