Smart Advertisers Abandon Failing Retail Media Networks for Amazon-Walmart Duopoly (And See 85% Better ROI)

TLDR Summary

• Market Concentration Crisis: Amazon controls 75% of retail media spend while Walmart holds another 10%, leaving just 15% for 200+ smaller networks to fight over
• Data Disadvantage: Smaller networks lack the first-party data depth and digital footprint needed to compete with the duopoly’s closed-loop attribution capabilities
• Desperate Expansion Moves: Mid-tier players burn cash on costly offsite advertising and non-endemic partnerships they can’t afford to sustain
• Consolidation Accelerating: Industry shakeout intensifies as fragmented spend patterns favor platforms with scale and integrated measurement solutions
• Strategic Survival Path: Smart advertisers diversify beyond the duopoly by targeting specialized networks with unique audience data and niche market advantages

The Retail Media Apocalypse Nobody Saw Coming

Remember when everyone celebrated the retail media explosion? 200 to over 250 networks globally. It seemed like advertising paradise had arrived.

That didn’t age well.

The retail media gold rush promised democratized advertising. Instead, it became a bloodbath. We patted ourselves on the back for “disrupting” traditional advertising. A brutal reality emerged: only two players actually matter.

Amazon and Walmart now control 85% of all retail media spending. This creates the first major performance marketing duopoly since Google and Facebook’s search-social stranglehold.

The remaining 15% gets fragmented across hundreds of smaller networks. These networks compete desperately for scraps. They burn through venture capital and retailer investments at unsustainable rates.

This isn’t just market consolidation. It’s systematic extinction.

Have you noticed your smaller retail media campaigns underperforming lately? There’s a reason for that.

The Data Death Spiral Crushing Smaller Networks

Amazon’s Insurmountable First-Party Data Advantage

Amazon’s retail media dominance isn’t just about size. It’s about something competitors literally cannot replicate: comprehensive customer journey data.

Amazon has 200 million Prime members generating purchase history, search behavior, and consumption patterns. Amazon offers closed-loop attribution that smaller networks simply cannot match.

Consider this competitive gap:
– Amazon tracks customer behavior from initial search through purchase and repeat buying
– Walmart Connect uses 240 million weekly shoppers across online and 10,500 physical stores
– Mid-tier networks like Best Buy or CVS rely on limited touchpoint data from single category interactions

It’s like bringing a knife to a gunfight. The gun is actually a data-powered missile system.

The Cookie Deprecation Knockout Punch

Remember when cookie deprecation was supposed to level the playing field? That didn’t work out as planned.

Cookie deprecation has accelerated the separation between data-rich and data-poor networks. First-party data targeting has become the new competitive moat. Smaller networks are drowning without sufficient customer insights.

Target’s retail media network struggles with limited digital footprint. This happens despite Target’s strong brand. Amazon’s ecosystem spans AWS, Prime Video, Alexa, and Whole Foods. This data disadvantage makes Target’s audience targeting less precise. Their attribution measurement becomes incomplete.

If you don’t have the data, you don’t have a business.

Programmatic Buying Consolidation

The shift toward programmatic retail media buying favors platforms with scale. Amazon’s DSP processes billions of daily bid requests across multiple inventory sources. Smaller networks lack the technical infrastructure and data volume to compete effectively in real-time bidding environments.

It’s not even close to a fair fight anymore.

The Desperate Off-Site Expansion That’s Failing

Burning Cash on Unwinnable Battles

Watching smaller networks try to compete is fascinating. They expand into areas where they’re even more outgunned.

Networks like Kroger’s 84.51° and CVS Media Exchange hemorrhage money trying to match Amazon’s off-site advertising capabilities. They lack the necessary scale or data depth.

Offsite advertising growth requires massive investments in:
– Display advertising inventory partnerships
– Video advertising technology stacks
– Social media integration capabilities
– Cross-platform attribution systems

Most mid-tier networks lack the capital to compete effectively across these channels. They cannot maintain profitability on their core on-site advertising products.

It’s like watching someone try to fight a heavyweight boxer by learning karate. The fight is already happening.

The Non-Endemic Advertising Trap

Non-endemic advertising partnerships seem like a growth opportunity. Brands advertise but aren’t sold by the retailer. These partnerships actually accelerate smaller network failures.

These partnerships require sophisticated audience modeling and cross-platform data integration. Most networks cannot afford to build these properly.

CVS’s health data might seem valuable for pharmaceutical advertising. Without Amazon-level scale in audience reach and measurement capabilities, these specialized advantages become expensive niche plays. They don’t become sustainable business models.

The math just doesn’t work.

Strategic Survival Guide for Advertisers

Diversification Beyond the Duopoly

Smart advertisers aren’t abandoning smaller networks entirely. They strategically select winners based on unique data advantages.

Best Buy’s Tech Audience Goldmine: Electronics and gaming advertisers find Best Buy’s retail media network delivers higher engagement rates. This happens because of specialized audience intent, despite lower overall reach.

Kroger’s Grocery Data Advantage: CPG brands use Kroger’s granular purchase frequency and basket analysis data for more precise targeting than Amazon’s broader marketplace insights.

The key is understanding when specialized beats scale.

The Commerce Media Evolution Strategy

The industry shifts from “retail media” to “commerce media” terminology. This reflects expansion into travel, financial services, and delivery platforms. Progressive advertisers explore these emerging channels before they become oversaturated or acquired by the duopoly.

Uber’s advertising platform, DoorDash’s sponsored listings, and Airbnb’s host promotion tools represent commerce media opportunities outside traditional retail network constraints.

Sometimes the best move is to play a different game entirely.

Measurement and Attribution Solutions

Cross-network performance measurement becomes critical when managing campaigns across multiple platforms. Advertisers invest in unified measurement solutions that provide performance insights. These don’t rely on individual network reporting systems.

Data clean room technology adoption is accelerating. Advertisers seek independent attribution measurement that doesn’t favor any single network’s methodology.

Trust but verify. This matters especially when networks report their own performance.

The 2025 Consolidation Prediction

Industry M&A activity will intensify. Smaller networks realize they cannot achieve sustainable unit economics independently. Expect technology providers like Adobe, Salesforce, or Oracle to acquire struggling retail networks for their first-party data assets rather than their advertising technology.

Amazon DSP versus Walmart advertising comparison searches are spiking. These two platforms increasingly represent the only scalable options for most advertisers. The duopoly isn’t just winning. It’s eliminating the competitive landscape entirely.

Specialized networks with irreplaceable audience data may find survival through niche dominance rather than scale competition. This includes healthcare, luxury goods, and B2B commerce.

Survival of the fittest is about to get very real.

Navigate the New Reality

The retail media democratization dream is dead. Strategic opportunities remain for advertisers willing to adapt.

Focus on the duopoly for scale and reach. Identify 2-3 specialized networks with unique audience advantages for targeted campaigns.

The extinction isn’t complete yet. Time is running out for mid-tier networks to prove their value beyond Amazon and Walmart’s overwhelming advantages.

What’s your current retail media network strategy? Are you prepared for the coming consolidation, or are you still spreading budget across too many struggling platforms?

The writing’s on the wall. The only question is whether you’ll read it in time.