Commerce media growth faces measurement and differentiation challenges

Retail and commerce media are experiencing significant growth, with EMARKETER forecasting that the category will eventually account for more than one in every four dollars spent on digital advertising.

Despite this expansion, the industry faces critical challenges regarding measurement and differentiation. Marketers are struggling to move beyond simple attribution—tracking a purchase following an ad—to prove incrementality, which determines if advertising generated new business that would not have occurred otherwise. Research from Circana indicates that while 75 percent of consumer packaged goods retail media campaigns drive impact beyond the initial retailer, fewer than 20 percent of marketers measure these effects holistically.

To sustain growth, industry analysts suggest that commerce media networks must differentiate themselves and move up the marketing funnel. This involves connecting commerce audience data with offsite channels such as social media, connected TV (CTV), and search engines. However, the effectiveness of these networks as intermediaries and the lack of standardized measurement across fragmented platforms remain significant hurdles for the sector.