The 2026 State of Retail Media: Building the Foundation for AI-Driven Commerce

For five consecutive years, Skai has surveyed U.S. consumer goods brand and agency marketers to understand what’s actually happening in retail media, making our State of Retail Media Report the industry’s longest-running benchmark study. In 2021, retail media was a $36.7 billion channel. What started as an emerging niche has become a $107.6 billion infrastructure play commanding 30% of all U.S. digital ad spending.

What was clear in this year’s survey is that retail media has reached an inflection point where strategic capabilities matter more than budget size. But the stakes extend beyond today’s performance gaps. As agentic commerce and AI-driven shopping interfaces reshape how consumers discover and decide, the operational foundations brands build now will determine whether they remain visible at the moments that matter most.

The channel’s explosive growth has also created a widening performance gap between brands that have built sophisticated operations and those that are still managing campaigns in silos. The 2026 State of Retail Media Report, produced in partnership with Stratably, reveals which capabilities separate leaders from laggards, where the next competitive advantages will emerge, and why omnichannel orchestration has become mandatory for success.

The performance gap is accelerating faster than the channel itself

Seven in ten brands report meeting or exceeding their retail media performance goals. That sounds like validation for the explosive investment growth. But our fifth year of research reveals a more nuanced reality: the divide between sophisticated operators and struggling teams is widening faster than the channel itself is growing.

The brands pulling ahead aren’t working harder. They built different operational capabilities. Six critical trends explain what’s driving the gap.

Omnichannel coordination is now table stakes

Retail media has evolved far beyond lower-funnel tactics. Brands now allocate 30% of their paid search budgets and 34% of paid social budgets to drive traffic to retailer sites rather than their own properties. The most sophisticated advertisers coordinate 32% of total media budgets through retail media as the hub connecting all channels. 

Why the shift? Brands cite visibility at point of purchase (44%), proximity to customers (34%), and retailer alignment (27%) as primary drivers.

This coordination becomes even more critical as AI reshapes the discovery landscape. Consumers increasingly turn to AI-powered tools to research purchases, compare options, and make decisions, bypassing traditional touchpoints entirely. Reaching them will only get harder. But AI also offers marketers a way to manage this complexity. The same technologies enabling smarter targeting, faster research, and more precise bidding can help brands stay visible across fragmented journeys. The key is building the unified operational foundation that makes AI-powered optimization possible.

For 2026 planning, this means breaking down organizational silos between media and commerce teams. Leaders treat retail media as the data backbone that informs cross-channel strategy, not a separate budget line managed by a different team.

Investment patterns reveal where brands are placing their bets

The numbers tell a clear story: 59% of brands are increasing retailer search spend. 57% are boosting social commerce investment. 50% are expanding into CTV through retail media. Meanwhile, 24% are actively cutting traditional search engine shopping ads.

The shift to retail media DSPs follows the same pattern: 52% of advertisers are moving display budgets from traditional programmatic platforms. The primary driver? Closed-loop attribution, cited by 57%, which connects ad exposure directly to purchase behavior. Another 36% cited access to commerce data that open web buying simply can’t provide.

There’s another advantage accelerating this migration. The commerce signals retail media DSPs provide (search behavior, browsing patterns, purchase history, subscription data) offer richer audience intelligence than almost any third-party data source. As AI-driven shopping fragments consumer journeys across more touchpoints, this first-party commerce data becomes the foundation for understanding what actually influences purchase decisions.

Brands currently manage an average of six networks, projected to expand to eight by year-end. To handle the complexity, 77% are prioritizing better measurement, and 68% seek platform consolidation.

Incrementality measurement separates guesswork from strategy

Brands actively measuring incrementality report tangible results: 54% reduced wasted spend, 49% increased new customer acquisition, and 29% improved competitive positioning. Looking ahead, 68% aim to improve profit margins through better incrementality insights.

Yet significant gaps remain: 14% still aren’t measuring incrementality at all. More than half cite limited analytics and data science resources as their biggest barrier. This measurement gap will widen as AI-driven commerce scales. When AI interfaces mediate more discovery and purchase decisions, understanding true incremental impact becomes essential for optimization. Brands building these capabilities now are preparing for a landscape where measurement precision determines whether you can compete at all.

GenAI adoption is shifting from creative to operational

Currently, 63% of marketers use generative AI in retail media, with 52% deploying it primarily for creative and content production. But 2026 plans show a dramatic shift: creative usage will drop to 42% while campaign management climbs to 42%, analytics reaches 42%, and personalization grows to 36%.

The most sophisticated brands are building systematic capabilities with clear use cases and operational integration. They’re using AI to optimize campaigns in real time, analyze performance signals across channels, and personalize at scale.

This shift matters beyond efficiency gains. As AI-powered shopping interfaces become primary discovery channels, brands need AI-native operations just to compete. The organizations building systematic AI capabilities now, not just for content but across the entire campaign lifecycle, are positioning themselves for a commerce environment where AI mediates both sides of the transaction.

Amazon’s complexity gap is a preview of what’s coming

Amazon Marketing Cloud adoption reached 56% despite significant technical complexity. Amazon’s DSP continues gaining traction through closed-loop attribution capabilities that competing platforms can’t match, with recent integrations with Spotify, Netflix, and Microsoft’s SSP expanding reach while maintaining measurement consistency.

When we asked marketers to rate their retail media maturity, a striking pattern emerged: brands report high confidence on Amazon but significantly lower sophistication across other networks. This comfort gap helps explain why Amazon continues capturing disproportionate investment beyond just scale and reach.

But Amazon’s advantage demands constant optimization work that most brands aren’t staffed to handle. You need specialized analytics talent to extract value from AMC, and most teams are under-resourced for the level of optimization these platforms require. This capability gap is a preview of what’s coming across all retail media as AI-native shopping scales and platforms demand increasingly sophisticated operational responses.

Organizational foundation is the real bottleneck

By the end of 2026, the average marketer will manage eight retail media networks. That sounds substantial until you consider there are dozens of options available, from grocers to consumer electronics retailers to home improvement chains. Why aren’t brands adopting a wider portfolio approach when more retailer touchpoints theoretically mean more audience reach?

The answer reveals the channel’s fundamental constraint.

Only 12% have integrated media and commerce operations. Internal resource constraints rank as the top barrier to performance improvement, ahead of budget, measurement capabilities, or platform complexity. Three-quarters of brands admit their measurement capabilities are weak or just adequate.

Budget isn’t the constraint. Neither is technology availability. The bottleneck is organizational foundation. Brands haven’t built the unified systems needed to optimize across the networks they already manage, much less add more. Without consolidated reporting, unified measurement frameworks, and coordinated optimization capabilities, each additional network increases complexity exponentially rather than linearly. This organizational constraint will become even more punishing as AI-driven commerce demands real-time optimization across increasingly fragmented touchpoints.

Conclusion: The capabilities you build now determine future visibility

Five years of tracking this channel reveals that retail media is at an inflection point. The explosive growth continues ($107.6 billion in 2025, nearly triple the investment from four years ago) but strategic capabilities haven’t kept pace with spending. The brands succeeding in 2026 won’t be those spending more. They’ll be the ones that built the operational foundation to orchestrate omnichannel campaigns, measure incrementality in real time, and deploy AI strategically across the campaign lifecycle. As AI reshapes how consumers discover and decide, these capabilities aren’t just competitive advantages – they’re the difference between visibility and irrelevance.

The 2026 State of Retail Media report contains comprehensive benchmarks, detailed analysis, and strategic recommendations across every aspect of retail media performance. Download the full report to see exactly where your organization stands compared to industry leaders, what specific capabilities separate winners from laggards, and which investments deliver the highest ROI in 2026.

Skai’s Retail Media solutions enable marketers to plan, activate, and measure campaigns across 200+ retailers, including Amazon, Walmart, Target, and Instacart, as part of a broader commerce media strategy. AI-powered pacing, product intelligence, and keyword tools help teams meet shoppers across the journey and tie spend to sales with confidence.

Ready to see how unified retail media operations can improve your performance? Schedule a quick demo.

Download the 2026 State of Retail Media report now.

---

Frequently Asked Questions