Member Exclusive   //   April 9, 2024

Modern Retail+ Research: Walmart & Target are encroaching on Amazon’s retail media dominance

Amazon remains the clear leader in retail media, but others are beginning to creep up.

Recent Modern Retail+ Research shows that brands and agencies are increasingly warming up to beefed-up advertising networks from players like Walmart and Target.

Over the last few years, major retailers and e-commerce players have been building out more robust retail media programs. And that’s changing the conversation advertisers are having. For example, agencies’ clients are increasingly asking about investing in retail platforms like Walmart, Target and Instacart.

“The investment chips, at least from our clients, are starting to flow into Walmart, Instacart, Kroger, Chewy, Ulta and more,” Jared Belsky, CEO of digital agency Acadia, told Digiday last month.

Indeed, agencies, brands and marketers recently surveyed by Modern Retail said that, excluding Amazon, Walmart and Target’s retail media networks were platforms they invested in the most.

Of course, Amazon is still king when it comes to this type of advertising. And it has been building out more capabilities trying to attract more brands. For example, as Modern Retail recently reported, the e-commerce platform has been increasingly pitching brands on its higher-funnel advertising services, all while having them connect with its traditional retail media units.

“The trend we’ve always seen is that Amazon is leaning into brands,” Dan Brownsher, CEO of the agency Channel Key, told Modern Retail last year. “[These changes are about] allowing Amazon to become a brand discovery platform.”

As such, it is still the most popular choice; 84% of survey respondents said they used Amazon’s retail media services, while Walmart was the second most popular with with 46%.

This advertising war is likely only going to increase. As retailers worry of dampening demand, they are increasingly trying to monetize other parts of the business. Walmart’s ad business, for example, grew 28% in 2023, hitting $3.4 billion.

“We believe global advertising and membership alone will represent 20% of annual operating income in FY 2025,” CEO Doug McMillon said at a recent earnings call.