Retail Media in the Gulf: A New Line on the P&L

Retail media has moved quickly from a curiosity to a standing item in category planning. Grocery chains, marketplaces and delivery platforms in the region are now selling sponsored placement, on-site display and audience data against their own transactions.

For retailers this is high-margin revenue attached to an asset they already own. For brands it is a new line of spend that arrived without a clear owner.

Nobody owns it on the brand side

Retail media sits awkwardly between trade marketing, which manages the retailer relationship, and digital marketing, which manages media buying.

The result in most organisations is that it is negotiated as part of a trade deal by people who do not evaluate media performance, or bought as media by people with no leverage in the trade negotiation. Both leave value on the table.

The measurement is better and the comparison is worse

The appeal is closed-loop attribution. The retailer can show that an impression preceded a purchase in a way that broadcast or social cannot.

The difficulty is that each retailer measures within its own walls, using its own definitions and its own attribution window. Comparing performance across two retail networks is close to impossible, and comparing either against your other channels requires assumptions that nobody enjoys defending.

Incrementality is the question to ask

Much of what retail media reports would have happened anyway. A shopper already walking to the category, served an ad for the brand they intended to buy, generates an attributed sale and no incremental revenue.

Ask any retail network what proportion of attributed sales are incremental, and how they established it. The quality of that answer tells you more than the headline return.

It is also a trade negotiation

Retail media budgets are increasingly requested alongside listing fees and promotional support. Treating them as separate conversations advantages the retailer.

Brands doing this well negotiate the total commercial relationship in one place, with visibility of what each element delivers, rather than allowing media spend to become an additional ask on top of a settled trade agreement.

For retailers considering launching

The margin is genuinely attractive and the operational requirement is frequently underestimated. You need clean first-party data, ad serving capability, measurement your advertisers will accept, and a commercial team that can sell media rather than shelf space.

Most importantly you need to decide how much of your customer experience you are willing to sell. The networks that have damaged themselves are the ones that let sponsored placement degrade the shopping experience faster than the revenue justified.