IAB Australia flags rising retail media spend & demands
Tue, 7th Jul 2026 (Today)
IAB Australia has published new research showing retail and commerce media spending is rising in Australia, while advertisers are demanding better measurement and transparency.
The industry body's Retail and Commerce Media State of the Nation 2026 report found advertisers increased spending across retailers' own websites and apps, retailer-run advertising beyond those owned channels, and in-store advertising. Among active buyers, 63% increased spend on retailers' own sites and apps, while 65% increased spend on retailer-powered advertising outside those environments.
The findings suggest retail media is drawing from established marketing budgets rather than sitting at the margins of media plans. Nearly half of retail and commerce media investment is now fully reallocated from other channels, with trade retail budgets and traditional advertising the biggest sources of that shift.
Harder questions
As spending grows, measurement remains the main source of friction. Inconsistent metrics and definitions across networks were cited by 73% of active buyers as the leading measurement challenge, while 59% said they had difficulty measuring return on ad spend or return on investment.
Advertisers are also placing greater weight on proof of effectiveness when choosing partners. Ad effectiveness measurement and performance were the joint top criteria for evaluating retail media partners, each selected by 48% of respondents.
Demand for common standards was also reflected in attitudes to certification. Four in five surveyed brands and agencies said a retailer's IAB certification status would make them more willing to work with that business as a retail media partner.
Gai Le Roy, chief executive officer of IAB Australia, outlined the industry body's view of the market's next stage.
"The findings show retail and commerce media are now firmly part of media planning and competing for real budgets. At the same time, buyers are asking harder questions of their partners and retailers are evolving their measurement offerings in response. That is a sign of market maturity. The next phase will be about making it easier for advertisers to invest with confidence across a more complex ecosystem. That requires standardised measurement, comparable metrics, stronger data infrastructure and better alignment between trade, marketing and media teams," Le Roy said.
Partner complexity
The report found advertiser experience with retail media partners has improved, even as the market becomes more crowded. Some 66% of surveyed brands and agencies rated their experience as good, up from 44% a year earlier.
At the same time, 86% said they now work with three or more retail or commerce media partners, and a third said they work with more than five. That points to a buying environment where more choice has brought more complexity for agencies and brands.
Retailers and commerce media networks were also cautious in assessing their own progress. Just 22% described their retail media offer as advanced, while 47% said it was still developing.
Revenue growth
On the sell side, most retailers and commerce media networks reported revenue growth across major formats. The survey found 93% increased onsite revenue over the past year, 75% increased offsite revenue and 89% increased in-store revenue.
Those businesses also signalled where investment is heading. The report found 84% plan to improve measurement, 84% plan to expand formats and channels, and 84% plan to expand their first-party data offering.
More than half said they plan to explore and adopt artificial intelligence technologies. The main uses identified were data analysis and insights, audience targeting, and measurement and reporting.
What buyers want
For advertisers, sales outcomes remain central. Increasing sales or conversions was cited by 90% of surveyed agencies and advertisers as the main objective of retail and commerce media activity.
That focus is shaping the data buyers want from retail media partners. Incremental sales measurement was named by 83% of active buyers as a sought-after metric, while 76% cited return on ad spend.
Supply has yet to catch up evenly with that demand. The report found 64% of retailers and commerce media networks provide incremental or sales lift measurement, while 60% offer return on ad spend reporting.
Use of formats remains concentrated in display and search, but buyers are also showing interest in other channels. The report pointed to strong forward intent for sampling, in-store digital signage, retail out-of-home and video on connected TV.
Lachlan Brahe, chair of the IAB Australia Retail Media Council, said: "Rapid growth balanced with increasing sophistication are encouraging signs for the industry. Our latest findings show that advertisers are expecting more robust measurement and transparency, and retailers are investing in advanced solutions to address these and other areas. The ongoing work of the IAB's Commerce and Retail Media Council is aimed at bridging these organisational gaps and unlocking even greater trust and value across the retail media sector."