The Struggle for Control Over Retail Media Investment

As retail media continues its rapid expansion—surpassing Rs.15000 crs in Indian ad spend— an important question arises: Who should oversee these investments? The issue extends beyond budget allocation; it encompasses strategic alignment, performance measurement, and ensuring optimal returns. The current fragmented structure, where multiple teams compete for control, has created a complex landscape for both marketers and agencies.

A Fragmented Investment Structure

Retail media budgets are often distributed across different teams within an organization. According to a Forrester survey, trade marketing accounts for 36% of retail media spend, while shopper marketing contributes 26%. The remaining share falls under marketing teams, highlighting the decentralized decision-making process. This fragmentation not only complicates budget management but also makes it difficult to measure overall performance effectively.

Challenges for Agencies

Agencies must navigate a dynamic and often disjointed client environment, working with multiple teams that have varying priorities and objectives. This complexity can lead to conflicting strategies, diminishing campaign effectiveness. Furthermore, the absence of centralized oversight makes it challenging for agencies to deliver consistent, strategic guidance.

The Influence of Incentive Structures

Retail media investments are frequently leveraged by sales teams in negotiations with retailers, often as a means to secure better shelf placement or other advantages. While this may provide short-term benefits, it complicates the ability to optimize spending based on performance data. As a result, resources may be allocated inefficiently, driven by immediate sales objectives rather than long-term marketing strategies.

The Role of Technology in Unifying Retail Media Spend

The rapid advancement of AI, data analytics, and automation presents an opportunity to centralize and streamline retail media management. Emerging technologies can help unify fragmented budgets by offering a single view of spend across departments, improving transparency and accountability.

Retail media networks (RMNs) and demand-side platforms (DSPs) are increasingly integrating AI-driven solutions to provide more precise audience targeting, real-time performance tracking, and automated optimization. Companies that invest in these technologies can gain a competitive advantage by making more data-driven, cohesive marketing decisions.

Cross-Functional Collaboration: Breaking Down Silos

For retail media investments to be truly effective, organizations must foster stronger collaboration between marketing, sales, trade, and shopper marketing teams. A well-defined governance model can clarify roles and responsibilities, ensuring that budget decisions align with broader business objectives.

Leading organizations are already adopting cross-functional teams dedicated to retail media, bringing together expertise from different departments to drive strategic alignment. This approach ensures that campaigns are not only optimized for short-term sales impact but also contribute to long-term brand growth and customer engagement.

A Path Toward Centralization

To overcome these challenges, many industry experts advocate for consolidating retail media budget oversight within marketing teams. A centralized approach would enable more comprehensive tracking, measurement, and optimization of campaigns. However, achieving this shift requires more than just a procedural change—it demands a cultural transformation where different departments align their goals and collaborate more effectively.

Additionally, executive leadership must champion this shift, establishing key performance indicators (KPIs) that reflect a unified retail media strategy. By prioritizing performance-driven metrics, organizations can make more informed decisions about where and how to allocate budgets.

Future Trends in Retail Media

As retail media continues to evolve, several trends are poised to influence its future:

• Retail Media as a Profit Center: An increasing number of retailers are recognizing retail media as a fundamental revenue stream, resulting in heightened competition and innovation in advertising offerings.

  
  

• AI-Driven Personalization: Advanced AI models will facilitate hyper-personalized advertising experiences, enhancing engagement and return on investment.

  
  

• Omnichannel Integration: The distinction between in-store and digital media will continue to diminish, necessitating seamless coordination between online and offline campaigns.

  
  

• First-Party Data Utilization: With the phase-out of third-party cookies, brands will increasingly depend on first-party data from retail media networks to inform targeting and personalization strategies.

  
  

Conclusion

The debate over control of retail media spend is ultimately about more than just budget management—it is about fostering a unified strategy that drives measurable business growth. As retail media continues to evolve, marketers and agencies must work together to streamline decision-making processes and ensure that investments are strategically aligned.

By leveraging technology, fostering cross-functional collaboration, and adapting to emerging trends, organizations can unlock the full potential of retail media. A centralized, data-driven approach will not only lead to stronger performance but also position brands for sustained success in an increasingly competitive retail landscape.