Retail media and the $300 billion opportunity for affiliate marketing
Retail media is no longer a niche channel – it’s a $150 billion global market, expected to double within a few years to represent a fifth of all digital ad spend.
However, the vast majority of retail media investment is currently focused on onsite activity, like sponsored listings or display banners. The next, and arguably most scalable, wave of retail media growth will come from extending a retailer’s reach off-site.
Consumers’ declining trust in traditional, biased brand advertising has created a “trust deficit,” forcing them to look elsewhere for purchase validation. As a result, they now actively seek authentic, third-party proof from trusted creators, reviewers, and communities, which is precisely the environment where off-site media thrives.
As retail media expands off-site, affiliate marketing becomes its natural, performance-based engine by providing the established network of trusted, third-party creators and publishers needed to drive authentic sales, creating a massive opportunity for affiliates to capture new streams of advertising revenue – a $300 billion opportunity.
Brands that invest in proper tracking infrastructure, adopt sophisticated attribution, and work with platforms capable of managing complex retail media affiliate relationships will capture more of this expanding opportunity.
Let’s take a look at how affiliate marketing fits into the wider retail media landscape, potential pitfalls, and the technical requirements and strategies needed for affiliate success.
Why retail media is reshaping brand spend
Retail media networks (RMNs) have been the beneficiaries of significant advertising investment because they offer first-party data alongside high purchase intent. So when retailers such as Amazon, Walmart, and Tesco sell advertising space through sponsored product placements and targeted ads, they capture consumers who are already ready to buy.
RMNs use internal shopper data to target advertisements with more precision than traditional channels. Ads appear on product pages, in mobile apps, at checkout, and through in-store digital displays. Growth continues as major retailers expand their advertising platforms. For instance, Tesco, Sainsbury’s/Nectar 360, and Costco have recently launched or scaled their networks to capture more brand marketing spend.
With investment pouring into RMNs, the question becomes: how do affiliates seize their share of this high-intent ecosystem?
Affiliate marketing finds its sweet spot
By its very nature, affiliate marketing’s performance-based model suits retail media’s focus on measurable returns. Affiliates benefit from operating within retail media environments because they work closer to purchase decisions. For instance, when affiliate partners integrate with retail media campaigns through performance incentives (such as commission rate boosts), promotional codes, or partnerships within retailer platforms, conversion rates improve by driving engaged offsite traffic into these high-intent retail environments.
At this year’s Affilifest, speakers highlighted how first-party shopper data is opening new pathways for affiliates, who can deliver higher conversions with lower customer acquisition costs by driving engaged traffic into these high-intent retail environments.
Solving the attribution challenge
But while the opportunity is huge, affiliate marketers also face persistent attribution challenges. Today, 81% brands believe they have perfect attribution, but as panelists discussed, when affiliates work within retailer ecosystems, traditional last-click attribution becomes more problematic as purchases span multiple touchpoints within owned retail environments.
Hierarchical attribution offers a solution. Instead of universal attribution models, brands need to recognise that different publisher types require different approaches. Content publishers drive awareness, cashback sites facilitate conversions, and review platforms influence decisions. Each contributes differently to customer journeys.
Of course, attribution only works if the right tech stack is in place – something many brands are still catching up on.
Building an affiliate tech stack fit for retail
Winning in retail media demands strong infrastructure. Today’s partnership management platforms give vendor brands the capability to track and measure partner activity across e-commerce, apps, in-store moments, and media placements – mirroring the multi-channel sprawl of retail media itself.
Advanced attribution capabilities allow brands to validate affiliate performance deep within the retail ecosystems. Integration features make it possible for affiliates to manage promotional codes and sponsored placements, with clear visibility and reporting from first click to final sale.
From test-and-learn to scalable affiliate partnerships
Successful retail media affiliate partnerships often start with content strategy. Rather than standard product reviews, affiliates are relying more on creating viral content, personal stories, and material that connects with their audiences. Then they can direct their traffic through to the retail environments.
Trust, creativity, and control matter: affiliates who maintain their distinctive voice while plugging into RMNs drive stronger performance. This requires understanding audience preferences and creating content that naturally guides consumers toward retail environments where purchases can be tracked properly.
For brands entering the space, it’s wise to start small. Test specific product lines and budget limits to find the right fit before ramping up investment. Learn what resonates across audience segments and refine the partnership approach accordingly.
Retail media is expanding at breakneck speed. Brands and affiliates that master attribution, invest in the right platforms, and experiment with scalable partnerships will capture the most value. Meanwhile, those that delay risk being shut out of one of the fastest-growing channels in digital advertising.
Also Published in: Modern Retail
