Retail media networks have emerged as a game-changer, allowing brands to tap into first-party data, deliver personalized ads, and maximize revenue. Pairing this with loyalty management solutions unlocks even greater potential—enhancing customer retention and creating new monetization streams.

 
As brands explore the best retail media advertising platforms, integrating loyalty software can elevate customer engagement and drive long-term value. In 2025, retailers and CPG brands must rethink their media strategies to remain competitive. This blog unpacks the synergy between retail media partnerships and loyalty programs, offering actionable insights for brands looking to optimize both.

How Does a Retail Media Network Work

Consider two brands—let’s call them Brand A and Brand B. You’re scrolling through the mobile app of Brand A, but suddenly notice an ad for a similar product from Brand B.

 
How can this happen? Why are you seeing another brand’s product on Brand A’s mobile app?

 
Welcome to the world of retail media networks (RMNs). In simple terms, retail media networks allow retailers to use their own digital platforms to sell advertising space to various brands. It’s a strategic way for retailers to generate extra revenue by letting other companies promote their products to shoppers actively browsing their website or app.

 
Retail media networks have been around for quite some time. E-commerce giant Amazon has been dominating this space with an impressive market share of 76.9%, leveraging its robust retail media technology.

 
A strong pillar that boosts Amazon’s revenue in this space is its 230 million members-strong loyalty program, Amazon Prime. By integrating loyalty management with retail media partnerships, Amazon effectively enhances customer engagement and maximizes profit.

How Loyalty Programs Can Generate Revenue Through Retail Media Networks 

 
While loyalty programs are by themselves a great revenue generator for businesses, they also open up a new revenue stream through RMNs. 

 
A brand running loyalty programs has one of the biggest treasure troves, access to first-party data about their customers. The end-to-end customer behavior data that loyalty programs bring in can be used to open up their platforms for other similar retailers to reach and target this customer base. They can use this customer data to create audience segments to deliver highly targeted ads and offers and also reach new customers. Retail media networks create a win-win situation for both brands and advertising retailers.

 
Retailers looking to advertise can use RMNs by brands to: 

• reach a broader audience
• reach target audience segments
•  generate higher ROI

 
In the case of brands with loyalty programs, RMNs create an

• an added layer of revenue through the ads placed and,
• add more value to their existing customers by showcasing products and offers that are more relevant to them

 
The success of this partnership boils down to the accuracy of the data and insights that loyalty programs can provide. Brands planning to create their retail media networks need sharp customer insights that go beyond purchase history and recent searches. This is where Capillary’s Insights+ can help in understanding data that can be used to create ads that are more relevant and less intrusive.

Popular Retail Media Networks Ruling the Space

How Amazon became one of the biggest retail media networks  

Amazon’s retail media network is known as Amazon Advertising and it operates through various channels such as Amazon.com, Amazon devices (like Kindle and Fire TV), and Amazon-owned platforms like IMDb and Twitch. Brands can place ads on Amazon’s website and app, targeting specific products, categories, or even individual shoppers based on their browsing and purchase history. Amazon offers various ad formats, including sponsored products, sponsored brands, and display ads

Expanding retail media network to physical stores through Walmart Connect

Walmart’s retail media network, known as Walmart Connect, offers an added advantage over Amazon through its physical stores. Through Walmart Connect, brands can place ads on Walmart’s in-store digital displays, website, and mobile app, targeting shoppers based on their demographics, interests, and shopping behavior. While the revenue through Walmart Connect stood at 2.1 billion US dollars in 2021, it is expected to reach 4 billion US dollars in 2024.

Retail media network in grocery retail through Instacart

Instacart’s retail media network allows brands to place ads within its grocery delivery platform. Brands can target shoppers based on their shopping habits, preferences, and location, reaching them while they are actively browsing for groceries online. Instacart offers various ad formats, including sponsored product listings and banner ads, providing brands with opportunities to increase product visibility and drive sales.

 
Read: 5 Best Grocery Loyalty Programs from APAC and MEA

Challenges and Considerations in Retail Media Space

We are still in the early days of RMNs, with brands still exploring the best possible ways to make RMNs a part of their customer experience as well. It comes with challenges and considerations at this stage, a few of which are listed below:

• According to the Wakefield study, 99% of respondents say that the retail media network requires a minimum audience of 6 million monthly, creating a hurdle for smaller and upcoming brands to compete with the larger RMNs in existence.

• In its current state RMNs offer more targeted ads and not personalized ones. Though the ads will be highly relevant to the customers, adding more value to their experience, personalization is still far from reality. With more emphasis on AI and ML in the coming years, we can hope to see more advancements in this area. 

• A brand with its own RMN needs to tailor their vast data to the brands buying the data. They will have a huge set of data through their loyalty programs but not all this will be needed for the advertising. They can segment their customer data and trim it down to the requirements of the buyer brand, thus ensuring effective targeting by reaching only the customers who will benefit from this targeting

• Considering the fact that RMNs are nothing but data monetization, it is natural to ponder over the data privacy concerns. However, the ethical principle to run your own RMN is about protecting data through a secure data collaboration, which uses anonymized customer data and does not expose any personally identifiable information (PII). 

Takeaways

As of now, while industries like CPG and retail heavily rely on RMNs, a recent study by McKinsey found that more than 75% of non-CPG brands plan to increase their spend with media networks in the coming years. Thus, opening avenues and opportunities for media networks outside of retail. 

 
The fusion of retail media technology and loyalty programs is redefining the way brands engage customers. By leveraging loyalty software and the best retail media advertising platforms, companies can maximize their data, create highly personalized experiences, and unlock new revenue opportunities./span>

 
As retail continues to evolve in 2025, brands that invest in retail media partnerships and advanced loyalty management will stand out. The key lies in harnessing first-party data, building meaningful customer connections, and staying ahead of the competition in an increasingly digital marketplace./span>

 
Kickstart your journey towards creating a successful RMN with a strong loyalty program. Get in touch with us now!

FAQs

1. What are retail media networks, and how do they benefit brands?

Retail media networks allow brands to advertise within a retailer’s ecosystem using first-party data. This helps businesses deliver highly targeted ads, optimize customer engagement, and boost sales through personalized shopping experiences./span>

2. How do loyalty programs enhance retail media partnerships?

Loyalty programs provide valuable first-party data that retail media networks use to refine ad targeting. This synergy enhances customer retention, drives repeat purchases, and improves the performance of retail media advertising platforms./span>

3. What are the best retail media advertising platforms in 2025?

Some of the top retail media advertising platforms include Amazon Advertising, Walmart Connect, and Instacart Ads. These platforms leverage retail media technology to optimize ad placements and customer engagement./span>

4. How can loyalty management software support retail media networks?

Loyalty management software helps brands track customer interactions, personalize rewards, and analyze shopping behaviors. When integrated with retail media networks, it enhances ad relevance and strengthens retail media partnerships./span>

5. How can brands maximize revenue using retail media networks?

Brands can increase revenue by leveraging retail media partnerships, utilizing first-party data, and integrating loyalty software to create personalized customer experiences that drive higher conversions and retention./span>

Share

With a knack for creating engaging content and crafting effective social media campaigns, Anjali wants to make it her mission to leverage the power of content as a strategic marketing tool for businesses. While she is not working, she is either binging movies or writing about them on her blog.