Expected to grow at 13.5% in 2025, retail media witnessed a surge this year

Quick commerce player Zepto achieved a major milestone by surpassing Rs 1,000 crore in annualised advertising revenue. Not far behind, its competitor, Blinkit, reported an impressive fourfold increase in ad revenue to over Rs 400 crore for the financial year 2023-24, with strong projections to cross Rs 1,000 crore in the current fiscal year. 

Global giants are also reaping the rewards of retail media. Amazon Seller Services, the Indian arm of the e-commerce giant, generated a staggering Rs 6,649 crore in advertising revenue in 2023-24, while Walmart-owned Flipkart Internet reported Rs 4,972 crore in the same period. 

Moreover, Uber revealed in August 2024 that its global advertising business had achieved an annualised net revenue run rate (ARR) of $1 billion, underscoring the growing global dominance of retail media.

These numbers reflect broader trends identified in GroupM's 2024 Global Mid-Year Forecast, which predicts that retail media will grow by 17.5% worldwide in 2024 and continue its upward trajectory with a 13.5% growth rate in 2025. 

Locally, the trend is equally pronounced. According to Statista, advertising revenue from India’s online retail market exceeded $1 billion (around Rs 80,470 crore) in the financial year 2023, marking a twofold increase compared to FY 2021.

Retail media has firmly established itself as the breakout trend of 2024, solidifying its position as the fastest-growing segment in digital advertising. Across the globe and in India, this innovative approach to marketing has become a game-changer, driving significant revenues for e-commerce and quick commerce platforms while reshaping how brands connect with their audiences.

The appeal of retail media lies in its ability to combine precise targeting with measurable impact. For brands, retail media networks offer a platform to connect with customers through impactful communication, enhanced visibility, and personalised offers. 

By leveraging these networks, brands not only boost sales but also gain invaluable insights into consumer behaviour and preferences.

This rapid adoption has shifted the balance of digital ad spending, with e-commerce and quick commerce platforms now commanding a significant share of brands’ marketing budgets. Retail media has become an essential tool for standing out in crowded marketplaces, making it indispensable for both brands and advertising platforms in the years to come.

While convenience and variety make e-commerce platforms the top options, quick commerce is also gaining traction for its speed. Quick commerce platforms are increasingly ramping up their ad business to rake in additional revenue from advertising. Swiggy, in its initial public offering prospectus, stated that it planned to increase the contribution of advertising revenue further by enhancing its advertising tools.

In November, Zepto launched Jarvis, an in-house ad platform for brands and sellers. It helps small and large brands increase brand salience and platform sales by running optimised and focused campaigns for Zepto’s users. 

In October, Blinkit introduced its Seller Hub programme, similar to Amazon's Fulfilled, to onboard brands onto its marketplace. The platform provides brands with access to sales insights and advertising tools.

Sahiba Sachdev, VP, media planning and buying, Interactive Avenues, had earlier told afaqs! that users interact with these apps daily—whether to place orders or track deliveries—creating a level of engagement akin to gaming addiction. These platforms remain relatively uncluttered, offering better ad placements and engaging users during highly "mindful" moments.