Offsite retail media: Ads beyond the aisles

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  Quantumrun Foresight
• February 27, 2025

Insight summary

Offsite retail media expands targeted advertising to external digital platforms by using first-party data. This approach creates new revenue streams and more precise ad targeting but introduces challenges like privacy concerns and complex data analysis across multiple platforms. To navigate these issues, businesses and governments may need to adopt tools for privacy-compliant data management and update policies to balance growth with consumer trust.

Offsite retail media context

Offsite retail media allows brands to engage customers beyond traditional retail-owned properties. While retail media originally concentrated on ads within retailer-owned websites or stores, advances in data-driven marketing now allow advertisers to target shoppers across external digital platforms like social media, video streaming services, and programmatic networks. Retailers leverage their first-party data—collected through loyalty programs and transactions—to match customers with relevant ads even when they are browsing outside the retail ecosystem. This shift is opening up new revenue streams for retailers while giving brands greater precision in reaching high-intent consumers.

A growing number of companies are embracing offsite retail media as a way to extend their advertising reach and improve campaign performance. Tesco’s Media & Insight Platform, for example, integrates loyalty program data with partner platforms, such as Meta, Pinterest, and The Trade Desk, enabling brands to deliver targeted ads across various channels. Similarly, Amazon has partnered with Meta and Snapchat to enable in-app shopping ads. According to eMarketer, US retail media spending on connected TV alone was projected to rise 335.5 percent year-over-year in 2024 (reaching USD $3.64 billion). Investments in offsite retail media are also anticipated to reach USD $24.02 billion by 2027.

However, offsite retail media presents challenges, particularly in attribution and campaign management. Unlike onsite media, where customer actions are tracked within a retailer’s environment, offsite campaigns involve multiple platforms, making it harder to measure return on investment. To address these complexities, retailers are adopting conversion application programming interfaces, data clean rooms, and audience-level attribution models to ensure accurate performance tracking while maintaining user privacy. Additionally, companies are providing centralized audience management tools that allow retailers to streamline their offsite retail media efforts across various advertising channels. 

Disruptive impact

Consumers may find themselves exposed to more relevant ads tailored to their past purchases, making it easier to discover products they genuinely need. However, the increased use of first-party data could raise privacy concerns, as individuals may feel uneasy about how retailers track their activity across multiple platforms. To address this, companies may need to improve transparency around data usage, allowing consumers to opt in or out of targeted advertising while still receiving a personalized shopping experience.

Retailers may generate higher ad revenue, but they also risk alienating shoppers if ads become intrusive or irrelevant. Brands may face challenges balancing control over messaging as campaigns are often managed through retailer accounts rather than directly by the brands themselves. Companies that effectively integrate offsite retail media into their marketing strategies may gain a competitive edge, particularly in consumer packaged goods, where precision targeting can drive sales without increasing advertising costs.

Meanwhile, governments may need to update data protection policies to keep pace with the expanding role of first-party data in digital advertising. Regulations, such as the General Data Protection Regulation in Europe and the California Consumer Privacy Act, may require further refinements to ensure advertisers handle consumer data responsibly. Additionally, tax authorities may look into new ways to regulate and monetize this growing revenue stream, especially as retail media networks compete with traditional advertising platforms. Policymakers may also assess whether specific sectors, such as healthcare or finance, require stricter guidelines to prevent potential misuse of consumer data in targeted advertising.

Implications of offsite retail media

Wider implications of offsite retail media may include: 

• Retailers forming new partnerships with global tech platforms, expanding their influence across international advertising markets.
• Increased reliance on data-sharing agreements between retailers and media companies, creating potential vulnerabilities in cybersecurity practices.
• Advertising agencies adapting their services to manage cross-platform campaigns, leading to a shift in industry roles and job descriptions.
• The government establishing stricter standards for cross-border data transfers, affecting how international campaigns are executed.
• Small businesses accessing targeted advertising opportunities through retailer platforms, leveling the playing field in digital marketing.
• Social media platforms seeing higher competition from retail media networks, possibly leading to changes in advertising rates and formats.
• Growing demand for technology professionals skilled in privacy-compliant data analytics.
• Demographic shifts influencing ad targeting, with aging populations driving campaigns focused on healthcare, wellness, and other niche needs.
• Environmental concerns about increased energy consumption from large-scale data processing in retail media networks, prompting calls for sustainable practices.

Questions to consider

• How could the growing presence of personalized ads across platforms change how you make purchasing decisions?
• What steps can businesses in your industry take to leverage retail media while respecting consumer privacy?