European retail media partnerships extend as measurement challenges persist

IAB Europe published its second annual Attitudes to Retail Media Report on July 15, 2025, revealing substantial shifts in how European advertisers and retailers approach retail media partnerships. The comprehensive study surveyed 180 respondents across 31 markets, documenting a sector that has matured beyond experimental phases into strategic advertising infrastructure.

According to IAB Europe, the percentage of buy-side stakeholders maintaining retailer partnerships for more than one year increased from 50% to 63%. Meanwhile, brands working with four to six retail media networks more than doubled from 10% to 24%, signaling a clear diversification strategy among European advertisers.

"This year's report confirms that Retail Media is no longer an emerging trend, but a strategic priority," commented Marie-Clare Puffett, Industry Development & Insights Director at IAB Europe. The research demonstrates how brands have moved beyond single-network relationships toward portfolio approaches that maximize reach and performance across multiple retail environments.

The study reveals significant budget reallocation patterns driving retail media growth. Display advertising emerged as the primary source of reallocated funds into retail media at 55%, overtaking linear television's 45% share from 2024. Brand advertising budgets represented 60% of shifted investment, while performance advertising budgets contributed 55% of reallocated spending.

Summary

Who: IAB Europe's Retail & Commerce Media Committee conducted the survey, receiving responses from 180 advertisers, agencies, and retail media networks across 31 European markets. The majority of respondents (75%+) manage annual advertising budgets of €1 million or above.

What: The second annual Attitudes to Retail Media Report reveals growing partnership longevity, budget diversification, measurement challenges, and organizational evolution within European retail media. Key findings include doubled brand engagement with 4-6 networks, increased off-site investment, persistent standardization gaps, and strategic focus on first-party data activation.

When: The report was published on July 15, 2025, based on survey data collected between April and June 2025, representing year-over-year comparison with 2024 benchmarks.

Where: The research covers 31 European markets with respondents having both pan-European and global responsibilities, providing comprehensive geographic representation of retail media adoption patterns across the continent.

Why: The study addresses industry needs for benchmarking retail media adoption, understanding investment drivers and barriers, measuring ecosystem maturity, and identifying growth opportunities as retail media transitions from emerging trend to strategic advertising infrastructure within European digital marketing strategies.

Off-site investment gains momentum

While on-site retail media maintains dominance with over 90% of buyers allocating at least 41% of digital retail media budgets to on-site formats, off-site investment demonstrated remarkable growth. The proportion of buyers allocating more than 41% of digital spend to off-site retail media jumped from 30% to 46%, primarily driven by display and social advertising formats.

On-site sponsored product investment climbed from 67% to 81% among buy-side stakeholders, reflecting stronger demand for bottom-of-funnel placements that directly influence purchase decisions. Standard display banners maintained their position as the most prevalent on-site format, rising from 76% to 82% adoption.

Display advertisements lead off-site investment activity at 58% of buy-side spending, with social media maintaining a strong 55% share despite a slight decline from 60% in 2024. Connected television advertising captured 31% of off-site retail media budgets, highlighting the growing importance of video formats in retail media strategies.

However, a notable gap exists between buy-side demand and sell-side availability in emerging channels. While 31% of buyers allocate off-site budgets to connected television advertising, only 19% of retailers currently enable CTV placements within their networks.

Data activation drives investment decisions

First-party data access continues as the dominant driver of buy-side investment in retail media, with 87% of respondents citing this as a key opportunity. Point-of-sale consumer reach increased in importance, rising from 74% to 79% of respondents prioritizing this capability.

"The share of respondents prioritising 'reaching shoppers at the point of sale' rose from 74% in 2024 to 79% in 2025, underscoring an increasing focus on influencing consumers directly at the point of purchase," according to the report.

Interest in emerging channels continues expanding, with 42% of respondents valuing data access for reaching consumers via connected television, audio, and out-of-home advertising, compared to 36% in 2024.

On the retailer side, motivations have evolved beyond pure revenue generation. While additional revenue remains the top driver at 79%, strategic objectives surged to 70% and competitive advantage climbed to 62%, indicating retailers increasingly view retail media as integral to broader business strategies rather than supplementary income streams.

Measurement standardization remains critical challenge

Network fragmentation affects 51% of buy-side stakeholders, while lack of standardization impacts 53%, representing the most significant barriers to retail media growth. However, concerns about data availability decreased from 40% to 29%, and technology limitations fell from 49% to 37%, suggesting steady progress in network capabilities and infrastructure.

When evaluating retail media networks, buyers prioritize transparency and reporting (82%), performance metrics (76%), and measurement options (75%) as primary criteria. Return on Ad Spend leads metric demand at 88%, followed by incrementality measurement at 71%.

A critical gap exists between demand and supply for key metrics. While 88% of buyers require ROAS data, only 71% of retail media networks currently provide this measurement, highlighting inconsistencies across the ecosystem.

Media measurement (78%) and attribution (69%) top the list of areas requiring standardization. IAB Europe actively addresses this through its Measurement Standards for Retail Media, providing frameworks for consistent metric comparison across platforms.

Organizational structures adapt to growth

Internal approaches to retail media continue evolving on both buy and sell sides. Integration of retail media into digital media teams increased from 34% to 44%, while standalone retail media teams maintained steady growth at 27%, up from 23% in 2024.

Retailers are rapidly scaling dedicated capabilities, with 58% now operating separate retail media sales teams compared to 36% in 2024. Additionally, 27% integrate retail media into existing trade sales structures, up from 16% the previous year.

The maturity spectrum spans from basic strategies focused on lower-funnel tactics to sophisticated omnichannel approaches. Currently, 13% of buy-side stakeholders rate themselves at the highest maturity level, while another 13% remain at the basic level, with 62% now utilizing formal metrics or frameworks for partnership evaluation.

European market context and growth trajectory

The retail media sector's expansion occurs within broader European digital advertising growth. Digital advertising spending reached €118.9 billion with 16% year-over-year growth in 2024, according to IAB Europe's AdEx Benchmark Report, establishing the strongest expansion since 2011 excluding the pandemic-driven surge of 2021.

Retail media demonstrated exceptional performance with 22.1% growth compared to the overall advertising market's 6.1% expansion, nearly quadrupling the rate of total market growth. This acceleration reflects fundamental shifts in marketing priorities, with 67% of brands and agencies redirecting performance advertising budgets toward retail media investments.

Looking ahead, first-party data activation and omnichannel integration emerge as top growth priorities, each cited by 39% of buyers for the next 12 months. Incrementality sales measurement ranks third at 37%, reflecting continued emphasis on performance accountability.

"While standardisation was the leading priority in 2024, its prominence has now been overtaken by more strategic, outcome-focused levers—signalling a shift toward scalable growth and value realisation across retail media investments," the report states.

Industry collaboration continues advancing through initiatives like IAB Europe's certification programme and measurement standards development, addressing the critical need for unified frameworks that enable transparent, comparable metrics across networks.

Jason Wescott, Global Head of Commerce Solutions at WPP Media and Chair of IAB Europe's Retail & Commerce Media Committee, emphasized the strategic importance of addressing current challenges: "This report highlights the key drivers powering Retail Media's momentum, particularly the activation of first-party data and the growing influence of point-of-sale. While challenges like network fragmentation and lack of standardisation remain, it's promising to see concerns around data access and technology starting to ease."

The research indicates retail media has reached an inflection point where operational maturity must catch up with strategic ambition. As brands diversify their network portfolios and retailers develop sophisticated advertising offerings, the industry's next growth phase depends on resolving measurement inconsistencies and establishing unified standards that enable effective cross-platform comparison and optimization.

Timeline: European retail media developments

• • September 2024: IAB and IAB Europe release in-store retail media measurement standards for public comment
• • April 2025: IAB Europe releases Guide to Sponsored Products as retail media spending outpaces broader market by 4x
• • May 2025: European digital advertising reaches €118.9 billion with retail media as key growth driver
• • July 2025: IAB Europe Virtual Programmatic Day highlights retail media integration in programmatic strategies
• • July 15, 2025: IAB Europe publishes second annual Attitudes to Retail Media Report