Hi there,

Last week, I was reading an article by Modern Retail, and was shocked to see this stat: more than a quarter of retail brands say they're pulling budget out of retail media networks to spend it somewhere else. [1]

What makes that strange? Retail media isn't shrinking. In fact, it's a $69 billion category still growing double digits [2], and most marketers expect even bigger budgets this year. So why are brands backing away from one of the fastest-growing channels in marketing?

Because this was never really an exodus. It's something more telling: the money keeps growing, but the patience for spending it on faith is running out.

The era of "just be there" is over

For years, retail media was a presence game: claim the digital shelf, buy the placement, check the box. That era is ending. As Modern Retail put it, advertisers have shifted from merely having a presence to proving performance [1].

The reason is the oldest question in retail media: incrementality. The dashboard says a campaign drove sales, but would those people have bought anyway? When budgets are under this much scrutiny, "it probably worked" doesn't survive a conversation with finance. The brands moving money around aren't anti-retail-media… they're pro-proof.

And the biggest spenders are reorganizing around exactly this. P&G's CEO calls it a "new media reality" and is leaning on retail media plus data and AI to close the gap between discovery and purchase. The mandate, in Modern Retail's words: a disciplined approach that hits measurable business outcomes and folds in new tech like AI only where it earns its place [1].

But proving it means staring into six black boxes at once

Here's the part that gets underplayed: proving performance has never been harder. The average advertiser now runs six retail media networks, and that's projected to hit eleven by the end of the year [3].

Eleven logins. Eleven taxonomies. Eleven different definitions of a "conversion." Eleven walled gardens of data you can't take with you. Proving incrementality inside one network is hard enough. Across eleven, with no shared view of the customer underneath, it's nearly impossible. No wonder patience is running thin.

So the smart money isn't fleeing. It's demanding control.

If you can't prove it and you can't see it, you have two choices: keep spending on faith, or change what you demand. The brands staying confident in retail media chose the second. They stopped treating it as a faith-based line item.

Take Diageo, the company behind Johnnie Walker, Guinness, and Smirnoff. For years, most brands buried retail media inside "trade marketing," the tactical budget for in-store promos and shopper coupons that nobody measured very hard. Diageo pulled it out of that basement and moved it into the core marketing mix, run like real, accountable media. Their retail media lead put the condition plainly: if retailers want to be treated as media owners, they have to hand over comparable metrics, the same audience and performance data you'd expect from any other channel [4].

That's the whole game. "Demanding control" comes down to two questions: who did you actually reach, and did it actually work? You can't answer either if the only data you have lives inside the retailer's walls.

Which is why the brands who stay confident pair the rented audience with something they own: a direct line to the customer that exists outside any single network. When you can recognize the buyer yourself, you're not asking the retailer to grade its own homework. Retail media stops being a black box and becomes one input you can check against everything you already know about your customer.

I'll own my bias. I build close to this space, so of course I land on "know your customer." Having that data is the signal brands need to make all of their ad performance stronger. And retailers are never going to give that to you. But when you own it yourself and forward the deterministic buyer data back to ad platforms, your attribution is cleaner, audience building is sharper, ROAS is stronger, and CAC is lower.

So here's the question I'd sit with this week: where is your team still spending against a number you can't trace back to a single customer?

Talk soon,

Kait

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