Retail Media Networks Surge in 2025 as Smaller AI Models Drive Revenue Growth for Retailers – Wednesday, December 31, 2025

Retailers have aggressively expanded and refined their retail media networks (RMNs) throughout 2025. This strategic push is driven by the integration of smaller, smarter AI models that not only enhance RMN performance but also transform these networks into critical revenue streams and powerful customer engagement platforms.

Who should care: VPs of retail, store operations leaders, eCommerce directors, customer experience teams, and retail technology decision-makers.

What happened?

In 2025, the retail sector experienced a notable shift as retailers intensified efforts to expand and optimize their retail media networks (RMNs). These networks have rapidly evolved into essential tools for engaging customers and generating incremental revenue. Industry analyst Andrew Lipsman recently outlined the top 10 retail media predictions for 2026, underscoring the growing strategic importance of RMNs in retail operations. Central to this evolution is the adoption of smaller, more efficient AI models that enable retailers to optimize RMN performance with greater precision. These AI-driven models facilitate advanced data analysis, allowing for more personalized customer experiences and targeted advertising. Despite these advancements, challenges persist—particularly in measurement and attribution—where accurately assessing RMN impact remains a critical area for ongoing development. As RMNs mature, they are becoming indispensable components of retailers’ broader strategies, unlocking new avenues for revenue growth and deeper customer interaction.

Why now?

The heightened focus on RMN expansion and sophistication in 2025 reflects a broader industry imperative: retailers are aggressively pursuing innovative methods to engage customers and maximize revenue streams. Over the past 18 months, the accelerated adoption of AI technologies has enabled more precise targeting and personalization within retail media. This momentum is driven by the need for retailers to differentiate themselves in an increasingly competitive marketplace and to optimize the return on their advertising investments. As RMNs mature, they provide a robust platform for harnessing customer data more effectively, fueling the ongoing transformation of retail strategies.

So what?

The evolution of RMNs marks a fundamental shift in retail strategy, emphasizing the integration of data and AI to boost customer engagement and revenue generation. Retailers that successfully embed these networks into their operations can expect enhanced advertising effectiveness and stronger customer loyalty. However, persistent challenges in measurement and attribution underscore the necessity for continued innovation to fully unlock RMNs’ potential. Addressing these challenges will be crucial for retailers aiming to capitalize on the strategic advantages RMNs offer.

What this means for you:

• For VPs of retail: Prioritize investments in AI technologies that elevate RMN capabilities and refine customer targeting strategies.
• For eCommerce directors: Develop integrated strategies that seamlessly connect RMNs with existing eCommerce platforms to maximize customer reach and engagement.
• For customer experience teams: Utilize RMNs to craft personalized shopping experiences that drive customer satisfaction and foster loyalty.

Quick Hits

• Impact / Risk: RMN expansion offers significant revenue opportunities but also presents challenges in measurement and attribution accuracy.
• Operational Implication: Retailers must adapt strategies to incorporate AI-driven insights and optimize RMN performance for enhanced customer engagement.
• Action This Week: Review current RMN strategies, evaluate AI integration, brief teams on measurement challenges, and explore partnerships to strengthen RMN capabilities.