6 Trends Shaping Commerce Media in 2025
The pace of change in commerce media is evolving at a breakneck speed. Gone are the days when this space was confined to ads on sites. Today, it’s a sophisticated ecosystem that creatively uses data and tech to connect brands with consumers at every step of their shopping journey. As we move through 2025, the landscape continues to shift in new and unexpected ways. Here are six key trends driving the next wave of change.
1. From Retail Media to a Unified Commerce Media Model
Since its sharp acceleration in 2019, Retail Media Networks (RMNs) have been one of the hottest trends in advertising, estimated to be a $166 billion industry this year (forecasted by eMarketer). However, we're seeing a significant evolution. What started as a focus on retailers monetising their digital properties has expanded into a much broader concept: commerce media.
Companies outside traditional retail like JP Morgan Chase, PayPal, and United Airlines have entered the space, leveraging their rich consumer transaction data to target audiences with precision — consumer transaction data, whether it comes from a financial institution, a travel company, or a tech platform, offers valuable insights into purchasing behaviour.
For example, PayPal's advertising network allows brands to target users based on their payment and purchasing history, while United Airlines uses its loyalty program data to offer highly personalised ads to frequent travellers through in-flight screens and its app. These companies are not traditional retailers, but they are sitting on a goldmine of first-party data that can be used to deliver highly relevant ads.
This trend signals a major shift: Commerce media networks are no longer limited to retail giants like Amazon and Walmart. In 2025, expect to see even more non-retail brands entering the commerce media space, blurring the lines between industries and creating new opportunities for advertisers.
United Airlines entering the commerce media space to target personalised ads based on travel behaviours and first-party loyalty data.
(Image credit: Wall Street Journal)
2. Offsite Opportunities to Expand and Drive Format Diversification
The dominance of Amazon and Walmart in the retail media space is undeniable. Amazon's 75% market share has set a high benchmark for others aspiring to enhance their retail media capabilities. However, the reality is that many will never reach the scale of Amazon's retail media success, primarily due to limitations in their website inventory. As a result, many are turning to offsite opportunities and diverse ad formats to drive growth and better engage consumers.
Offsite Opportunities
While common onsite ads such as sponsored listings and display remain integral, the increasing saturation of these formats presents a significant challenge. For retailers with limited website traffic, selling ad space can be a struggle. However, they still retain their powerful asset: rich customer data which can drive sophisticated advertising strategies beyond the retailer’s site.
Offsite retail ads displayed outside a retailer's owned channels, such as on the open web, social media, or Connected TV (CTV)—is set to cement its position in the advertising ecosystem in 2025. By targeting shoppers at various stages of their journey outside of a retailer channel, brands can build cohesive and highly effective advertising strategies, reinforcing brand visibility and purchase intent.
The momentum is clear: according to the Path to Purchase Institute, offsite advertising takes up 60% of a brand's retail media strategy with Bain and Company estimating that 22% of retail media spending will happen offsite in three years time.
As offsite opportunities expand, programmatic ad buying is expected to play an increasingly pivotal role in 2025 with the automation of ad placements across both onsite and offsite channels. A key challenge here will be in the holistic reporting of all channels.
Premium and Immersive Ad Formats
Unlike onsite sponsored listings that often require minimal creative input, offsite advertising allows room for more sophisticated creative execution across multiple formats. Display ads, video content, CTV placements, and social media campaigns all require distinct creative approaches to capture consumer attention effectively.
To combat advertising fatigue and stand out in increasingly crowded digital spaces, brands are pushing beyond conventional formats to embrace more engaging experiences:
Interactive in-store digital displays that respond to consumer movement and engagement
Shoppable ads that seamlessly integrate with e-commerce stacks and payment gateways
Mobile experiences that bridge the physical and digital shopping journey
CTV stands out as a particularly high-growth channel, with 39% of advertisers already investing in CTV ad spots and projected spending to grow 45.5% this year. While QR codes currently serve as the primary bridge between traditional and digital shopping experiences, expect this technology to evolve into more sophisticated, seamless experiences. Not only do these advancements enhance the consumer journey without disrupting it, but they also provide valuable data points and commerce signals. This additional layer of customer insights facilitates a more robust and holistic view of customer intent, enriching both the effectiveness and prevision of targeted marketing strategies.
3. AI Advancements to Revolutionise Commerce Media
Artificial Intelligence (AI) is reshaping commerce media by driving efficiencies and enabling unprecedented personalisation. From data processing to creative optimisation, AI will play a central role in how brands interact with consumers.
Dynamic Personalisation and Predictive Optimisation
AI-powered algorithms can analyse vast amounts of shopper data in real-time, identifying trends and tailoring ads based on individual interests. This dynamic approach encompasses not only what users are currently searching for but also anticipates their behaviour based on purchasing patterns, ensuring the right message reaches the right consumer at the right time. According to McKinsey, personalised experiences can lead to a 5-15% increase in revenue for brands.
AI is revolutionising campaign optimisation by analysing shopper data to pinpoint ideal audience targeting, product recommendations, and predictive bidding. AI will continue to advance to substantially improve these capabilities to deliver personalised ads, driven by improved data analysis and customer segmentation.
Creative Innovation
AI is not just about data; it's also transforming creativity. Tools like ElevenLabs can generate high-quality audio content based on voice uploads, while other platforms are creating dynamic ad visuals and copy that adapt to different audiences. In 2025, we'll see AI take on a more active role in crafting ad campaigns, enabling brands to produce and automate highly engaging creatives faster and at a lower cost.
AI-Powered Commerce
As AI-powered search tools become more advanced, they'll move beyond simply answering questions to streamlining the path from interest to purchase. Klarna's AI assistant exemplifies this evolution, offering a chat-based shopping journey that helps users find the right products at the right price more efficiently, providing personalised recommendations and facilitating seamless transactions.
2025 may see AI search tools advancing beyond basic search functionality into facilitating transactions and commerce-enabled actions. Imagine asking an AI assistant for the best laptop under $1,000 and receiving not just recommendations but also personalised offers and a seamless checkout experience—all within the same interaction. This level of integration is set to redefine the shopping experience. As it is, we’re already seeing players like Perplexity release AI shopping, dubbing a “shop without limits” approach where the consumer goes from query to product recommendation and retailer site in one journey.
4. First-Party Data to Accelerate Strategies
As privacy regulations tighten and third-party cookies are phased out, first-party data has become the cornerstone of effective commerce media strategies. Brands are heavily investing in collecting and leveraging their own data to create personalised experiences while maintaining consumer trust.
Loyalty programs, email subscriptions, and app interactions are some of the primary methods for gathering first-party data. Starbucks, for instance, utilises its loyalty app to understand customer preferences and deliver individualised offers. Similarly, data from US Target's Circle loyalty program enables its retail media network with precise targeting of engaged shoppers.
The significance of first-party data will only increase in 2025, as brands continue to discover innovative means of collecting, analysing, and activating this crucial resource.
5. Strategic Partnerships to Unlock Offsite Growth
As commerce media becomes more complex, strategic partnerships that seamlessly integrate data, technology, and ad inventory are becoming essential for growth, especially in unlocking offsite opportunities. Retailers are discovering ways to extend their first-party data capabilities to the open web through these collaborations, creating new revenue streams by offering expanded advertising units and opportunities.
2024 alone has seen several groundbreaking partnerships emerge: Instacart joined forces with Google, enabling powerful cross-platform advertising capabilities; Walmart made a bold move acquiring smart devices manufacturer Vizio and its SmartCast operating system, opening opportunities for brands to reach shoppers through Connected TV; and Best Buy partnered with CNET to combine ad inventory and audiences, creating a more compelling proposition for advertisers while boosting revenue potential for both companies.
Looking ahead, we expect retailers to increasingly seek out strategic partnerships with major media and adtech companies as they aim to expand their advertising footprint and bring together all aspects of commerce media into a single ecosystem.
6. Full-Funnel Tools to Bridge the Commerce Media Gap
Onsite advertising, particularly sponsored listing ads, primarily taps into the lower funnel of a consumer journey. While bottom-funnel conversion remains crucial, the importance of top and middle-funnel awareness cannot be understated in building brand awareness and consideration. Savvy brands looking to expand their reach are increasingly recognising the potential of full-funnel advertising, where one creative campaign can work across the entire customer journey.
There's growing recognition of commerce media being a comprehensive full-funnel advertising tool, enabling closed-loop attribution. In 2025, more brands will seek partnerships with sophisticated technology providers that enable tracking of customer journeys from initial ad exposure to final purchase, providing crucial insights into Return on Advertising Spend (ROAS) measurement.
How Vudoo is Powering Commerce Media
The commerce media revolution isn’t just coming, it’s here. It’s reshaping how brands connect with consumers, turning every digital moment into a potential engagement or sale. As our ecosystem of brands, agencies and publishers navigate this dynamic landscape, those who embrace these trends and invest in cutting-edge technologies will be best positioned to succeed.
For brands looking to stay ahead of the curve, now is the time to experiment with new formats, build deeper audience connections through unified commerce media strategies and partner with innovative service and technology providers.
At Vudoo, we are proud to stand at the forefront of commerce media technology, uniquely positioned to redefine the intersection of advertising and commerce. Our platform excels by merging impactful, persuasive creative with the precision and efficacy of performance media. We unlock critical intent data and capture commerce signals, utilising our advanced headless commerce API to streamline the checkout process—effectively moving it earlier in the consumer journey. By transforming fleeting moments of inspiration into powerful opportunities for conversion, Vudoo not only enhances the consumer experience but also drives meaningful business outcomes. We’re not just participating in the market; we’re leading it by creating seamless, engaging, and highly effective commerce-enabled advertising experiences.