Retail media advertising is now an integral part of holistic media planning, according to the IAB Australia Retail Media State of the Nation 2025 Report.
The report found that 70% of advertisers and agencies using retail media have increased their investment in the last twelve months. Meanwhile, 77% now work with three or more retail media networks, up from 58% last year.
However, as the sector scales, brands and agencies are seeking more transparency, better data access and unified measurement frameworks across retail networks.
The report found that investment in retail media activity now comes from a mix of fully reallocated budgets (35%) and new budgets (19%).
Brands reported increasingly shifting their spend away from trade marketing and traditional media advertising, while agencies were reallocating budgets from social media and digital display.
Advertisers continued to express frustration over the lack of clear, standardised performance metrics across networks.
Return on ad spend (ROAS) topped the list of important metrics for agencies and brands, with 78% citing it as a priority, followed by incremental sales measurement at 71%.
The main barriers to investment in retail media were proving ROI (38% of brand advertisers) and measurement and reporting limitations (30% of agencies).
Gai Le Roy, CEO of IAB, said retail media is now at a stage where structure and collaboration are essential.
“To fully unlock the potential of this channel, the industry needs shared frameworks, clear measurement principles and greater transparency across networks,” she said.
“As we’ve seen in other maturing digital channels, establishing consistency is what allows innovation to scale. That’s where the IAB and its members can play a critical role.”
Lachlan Brahe, chair of the IAB Australia Retail Media Council and commercial director at Epsilon, said the report shows growing enthusiasm for retail media but also highlights where the industry needs to lift its game.
“With Retail Media becoming a staple for brands, there remain challenges for advertisers to navigate and adapt to fragmented systems and metrics,” he said.
“Further education is essential to support advertisers in understanding how best to leverage new formats and channels to achieve objectives and to compare performance across networks.”
Retail media is no longer confined to major supermarkets and marketplaces, with financial services and tech companies entering the space, according to the IAB Australia Retail Media State of the Nation 2025 Report.
More than 80% of agencies and advertisers say increasing sales is their primary goal for retail media, while nearly 85% of retailers are focused on enhancing their measurement capabilities over the next year.
The report found that agency planning and strategy teams are restructuring to integrate retail media, while retailers are hiring additional resources.
An industry survey conducted in June 2025 including 161 advertising decision makers across retailers, media agencies, agency trading desks, creative agencies and advertiser brands.
Of the buy side respondents, 66% were from advertising agencies and 34% from brands. Information was also collected from 19 retailers with a retail media offering in place.
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