Retail industry advertising in the U.S. - statistics & facts

Retail media advertising

The broad term refers to advertising and marketing to customers in the vicinity of their point of purchase, namely when they are browsing or buying in a physical store or its online counterpart. Retail media segments include but are not limited to shelf advertising, circulars, samples, but also advertising and recommendations around content on store websites. Today, with the expanse of online channels, U.S. digital retail media advertising spending surpasses 30 billion U.S. dollars and is expected to grow further to reach over 50 billion dollars. Advertisers in the country most commonly choose to cooperate with Amazon, by a large margin, and Walmart and Instacart are the other popular choices of retail media networks in the United States. Marketers indicate access to retailer first-party data as the most common reason to work with retail media, followed by building a stronger relationship with the retailer and understanding their customers better.

Retail advertising and e-commerce

In the first quarter of 2021, retail industry ad spend in the U.S. reached an estimated 2.73 billion U.S dollars, marking a 33 percent dip on the previous quarter. On the other side of the coin, digital ad spend of U.S. retailers increased by three percent in 2020, and while this figure could not measure up to pre-pandemic growth levels, it still outperformed all other verticals. Retail remains the industry with the highest digital ad spend in the country, thanks to companies’ quick embrace of e-commerce and other dynamic changes in consumer behavior. In 2020, when consumers switched from in-store to online shopping, and e-commerce sales accounted for 15 percent of U.S. retail spending, marketers allocated a record 17.3 billion U.S. dollars towards e-commerce promotion. Retail brands increasingly recognize the benefits of targeting users on these platforms, which is why retail e-commerce ad spend will continue to surge in the future.

Amazon dominates U.S. retail advertising

Amazon has been the retailer with the highest advertising spending in the United States for several years, accounting for almost 90 percent of retail media ad spend in early 2021. Back in 2019, Amazon’s U.S. ad spend surpassed 6.88 billion U.S. dollars, which was more than Walmart, Target, Macy’s, and Kohl’s spent on advertising collectively. Thanks to its vast portfolio of retail goods and its impressive global user count, Amazon has also become an attractive digital advertising platform for other brands and companies. Over 70 percent of retail brands who sell on Amazon also use the website for advertising purposes, and in 2021, Amazon’s U.S. ad revenue is forecast to reach a record 20 billion U.S. dollars. While the company still takes the largest slice of the retail advertising pie, companies such as Walmart are growing their market share more rapidly than ever.

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