By Ben Foulkes, VP Digital at marketing tech and data firm Epsilon
Retail media has quickly become one of the most exciting and dynamic spaces in digital marketing, but with rapid growth comes plenty of assertions: it’s a guaranteed multi-billion-pound opportunity, retailers must open their data, and standardisation is the key to success.
Most misconceptions stem from applying established media norms to this powerful yet complex ecosystem. Retail media blends commerce, data, and media in ways that challenge traditional thinking. It redefines how brands engage with consumers, creating new pathways for discovery and conversion – both online and in-store.
Approaching retail media the right way means separating fact from fiction. Here, we debunk five of the biggest myths inhibiting the conversation.
Myth 1: Retail media will be a £42bn industry by 2025
Retail media is undoubtedly growing, but framing it as a straightforward £42bn opportunity oversimplifies the reality. The space is increasingly competitive, with retailers, brands, and platforms all vying for a share. Growth isn’t just about scaling budgets; it requires navigating the complexity of trade spend versus incremental media investment.
Retailers must prove their networks drive true incremental sales rather than just shifting existing revenue streams. Brands are also becoming more selective, demanding greater transparency, standardised measurement, and clearer attribution to justify their investments.
On the platform side, the landscape is evolving rapidly, with new players entering and established networks refining their offerings. Success will depend not just on market size but on how well these complexities are addressed.
Myth 2: Retailers need to make their first-party data more accessible
There’s a belief that retailers must open their first-party data for brands to access freely, but the reality is more nuanced. Brands do need better insights, but retailers control their data for a reason – it’s a key asset underpinning their value.
Retailers aren’t just media owners; they are also competing businesses. Their data isn’t just about ad targeting – it informs pricing, promotions, and inventory decisions. Making this data widely accessible could erode its value and create competitive conflicts.
Instead, retailers are building closed-loop measurement solutions, offering brands performance visibility while maintaining control. The focus shouldn’t be on demanding more access but on working within these frameworks to maximise value. The best partnerships align retailer priorities with brand objectives.
Myth 3: Retail media needs more standardisation
As investment rises, there’s pressure to make retail media consistent with other channels and formats. Standardisation offers structure and simplifies measurement, but it could also stifle what makes retail media unique.
Unlike traditional media, which often relies on broad metrics like impressions and clicks, retail media thrives on tracking incremental performance. It allows brands to measure how each interaction impacts real business outcomes. Applying a one-size-fits-all approach could limit its potential.
Rather than forcing retail media to fit into existing standards, brands and retailers should embrace its distinctiveness. The real opportunity lies in refining measurement frameworks that reflect the complexity of shopper behaviour.
Myth 4: Budgets will be harder to come by in 2025
Many predict a challenging budget environment in 2025, but this overlooks a key factor: brands and retailers are scrutinising investments more than ever, seeking greater efficiency and ROI.
Retail media offers brands the chance to allocate budgets more effectively, shifting spend away from traditional platforms that may no longer deliver the same results. With concerns over media outcomes in search and social, retailers with strong data ecosystems are well-positioned to capture ad spend.
Rather than seeing 2025 as a year of cutbacks, it could be a year of smarter investments. Retail media’s ability to prove effectiveness will be key to its continued momentum.
Myth 5: AI will tear up the rule sheet
AI is everywhere, but its impact on retail media is often overstated. AI is only as good as the data it’s built on. To drive real results, it must be powered by solid first-party data – particularly SKU-level insights that enable personalised messaging and customer targeting.
AI that doesn’t leverage shopper-level data or that relies too heavily on broad insights won’t deliver the same value. While generative AI is a clever improviser, the real game-changer is predictive AI – enhancing first-party data to create more meaningful customer experiences.
Where does this leave us in 2025?
Retail media remains one of the most exciting innovations in marketing, but with innovation comes the need for clarity. By challenging assumptions – whether it’s the scale of opportunity, data accessibility, or the role of AI – we can create more effective, transparent, and results-driven retail media strategies.
Success will come from embracing what makes retail media unique rather than forcing it into existing models. Those who adapt and refine their approach will be best placed to unlock its full potential.
