Retail media — advertising sold by retailers around their own stores, websites and shopper data — is growing markedly faster than the retail businesses that host it, according to recent earnings coverage and forecaster estimates reported across the trade press.
The gap showed clearly in the latest quarterly results covered by PYMNTS. Walmart’s advertising arm, Walmart Connect, grew sales 43 percent year on year, while Target’s advertising revenue, mainly through its Roundel network, rose 29 percent to $279 million. Amazon’s advertising services revenue increased 26 percent to $19.8 billion in the period. Those growth rates compare with low-single-digit merchandise sales growth at the big-box retailers — roughly 3.5 percent for Walmart’s US net sales and about 5 percent for Target’s merchandise sales in the same coverage.
Forecaster estimates put the US retail media market at roughly $69 to $71 billion in 2026, up from about $59 to $60 billion in 2025, depending on the source. eMarketer figures cited in industry reporting suggest the majority of the incremental money flows to just two players: Amazon Ads, which holds around three-quarters of US retail media spending, and Walmart Connect in a solidifying second place. More than 200 retail media networks now compete for the remainder.
The economics explain the land grab. Merchandise retailing runs on thin margins and carries inventory and fulfilment costs; advertising monetises traffic and transaction data the retailer already generates, at far higher margin. Industry analyses estimate advertising margins in the range of 70 to 80 percent for established networks, and note that at Walmart, advertising and memberships together now contribute roughly a third of total company profit.
Retailers are also widening what they sell. Early retail media meant sponsored product listings at the digital shelf. Networks now offer off-site display, video and connected TV placements, using loyalty and purchase data to reach shoppers across the open web — and, increasingly, screens and signage inside physical stores, where measurement frameworks are still being standardised.
Artificial intelligence is the latest battleground. Walmart has been rolling AI assistants and campaign tools into Connect, aiming to automate planning, optimisation and reporting for advertisers, while Amazon continues to extend its own agentic buying tools. Both pitch the same promise: campaigns that prove, with receipt-level data, that an ad led to a sale.
For brand marketers, retail media’s rise rewrites budget politics. Trade marketing and brand media money increasingly land in the same negotiation, and the retailers control both the shelf and the scoreboard. On Friday, October 9, 2026, that dual role makes retail media impossible to treat as a niche buy.
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