Gaining Clarity on Retail Media Ownership & Budgets

Once retail media is treated as a media channel rather than a trade line, the following challenge is unavoidable: Should retail media sit with brand, media, sales or shopper? The answer depends on your vision for the channel, your vertical, in-house capabilities and external partners. For example, a business that treats retail media as pure conversion will organise differently from one using it for brand growth.

What matters is that ownership matches decision rights, and that spend is classified by why you are spending it. Most leading advertisers land in the middle: clear global principles and definitions, with local teams running activation. A clear central view, with markets free to execute.

Ensuring ownership matches decision rights

The setup of retail media matters less than people assume. What matters more is having an organisational structure where stakeholders in the ecosystem understand their roles and responsibilities. Marketers who get retail media right map responsibilities across the channel, with a RACI or equivalent, so there is a clear owner for every key decision (who sets strategy, allocates budget, picks and tiers retailers, plans and runs campaigns, measures, and decides where budget goes next).

When allocating ownership of retail media, one key clarification is knowing the intent behind spend. Defensive spend to hold shelf space is one thing. A reach campaign on a retailer’s CTV is another. The cleanest rule we use with clients is to classify retail media by intent, not by who books it. A discount, a performance push and a brand campaign are three different things, even on the same network, and they should look like three different things in the books.

Two budget traps to avoid

When everything goes into one trade pot, no one has visibility of the real retail media number. This is one trap to avoid – you can’t govern what you can’t see. According to recent IAB data, around two thirds of advertisers say they cannot prove incrementality . That is where measurement and accountability earn their place; they are what justify the budget in the first place. For anyone focused on efficiency, this is where waste hides.

The second trap occurs when budgets sit with brand or with sales, and the two pull in different directions. Brand teams are reluctant to fund retail media because it is still tagged as a bottom of funnel tactic, even when the RMN can deliver full funnel. In many companies, retail media is booked exactly that way – one line item classed as bottom of funnel, so brand budget can’t reach it even when it should. A hangover from how the channel started, and it quietly holds back spend.

The need for greater governance

Pressure on retail media is growing. Buying decisions are moving to AI agents. When an AI agent buys on a shopper’s behalf, will it choose you? That is a high intent moment that fits no team’s current remit, and the questions advertisers are wrestling with today are only set to get more challenging.

Retail media already shows up on earnings calls, with CEOs and CFOs treating it as a business driver. It is now too material to be governed by habit.

A few direct questions marketers should ask internally to get a sense of the effectiveness of their retail media ownership and budgets:

• Can you see your true retail media number, or is it hidden in a trade pot?
• Are trade and media contracted separately for governance, but planned and activated together?
• Can brand budget reach retail media, or is it stuck as a bottom of funnel line item?
• Do you audit the delivery and effectiveness data retailers report? Do you have the rights to?
• Do you know how much of each dollar spent reaches the retailer, and how much goes on tech fees along the way?
• If an agency runs your activation, are they set up to get the most from the biddable layer? Can you see how well they do it?
• Do you choose and prioritise networks on proof of value, or on habit?
• Do ownership and decision rights line up in practice, or only on paper?

Connect with us for more insight on building a more omnicommerce-centric organization.

Read part 1 ‘The Challenges of Retail Media’s Evolution’ here.

By Leo Oliveira, Client Director, Strategy