Retail media networks expect revenue to grow an average of about 23% this year, but fewer than one in five expect to exceed their plans, according to research presented by Sarah Marzano, principal analyst, Retail & Commerce Media at eMarketer, at Groceryshop 2026 in Las Vegas on Tuesday.

Nearly one-third of retail media networks anticipate falling short of their plans. The findings point to a disconnect between retailers' ambitions for their media businesses and their ability to execute on them, with gaps in technology, measurement and other basic capabilities making those ambitions harder to achieve.

Only 31% of retail media leaders said they were confident the revenue generated by their networks was incremental to existing supplier funding. The same percentage said they were confident their network was competitive with peers — down 14 percentage points from a year earlier. Just 28% expressed confidence in their organization's ability to determine its total addressable market.

As growth becomes more challenging, retailers are concentrating on familiar advertising channels. Sponsored search and onsite display advertising were among the top formats expected to generate near-term revenue growth, along with emerging retailer-native AI advertising.

"Onsite ads remain the backbone of retail media ad spending," Marzano said.

Artificial intelligence could both disrupt and expand the business. Among retail media networks that don't already have a native AI agent, 34% said they were building one with monetization in mind. Overall, 77% were pursuing new agentic advertising formats through testing, pilots or investment.

Brands, for their part, are pressing retailers to prove that advertising investments actually produce growth. Jacques Hagopian, senior vice president of Brand Operations, North America, at P&G, said retailers need to demonstrate that connection.

"Marketing dollars are incredibly, incredibly precious," Hagopian said. "If we invest something that doesn't generate growth, that's not a sustainable proposition for the industry."

Hagopian also said retail media can play a larger role in storytelling and creating demand rather than simply converting shoppers who have already decided to make a purchase. He pointed to P&G's work with Albertsons on Rico's Tacos, a 20-part short-form series about a father and daughter running a family business. The project combined P&G's storytelling capabilities with Albertsons' shopper and basket data to develop content tied to the retailer's customer journeys.

Instead of putting products at the center of every episode, P&G included three of its brands only when they were relevant to the story, Hagopian said. The short videos also featured Albertsons employees and creators.

"Now we're not shouting advertising at a consumer," Hagopian said. "It's much more about entertainment. They self-select, watch."

The campaign produced high engagement and completion rates, and two of the three P&G brands featured in the series recorded significant sales lift, Hagopian said. He described the project as an example of using retail media higher in the marketing funnel to create demand instead of relying solely on advertising closer to the point of purchase.

Stronger retail media partnerships require retailers and brands to move beyond short-term transactions, Hagopian said, and develop plans stretching 12 to 18 months across awareness, consideration and purchase. That approach can also connect advertising with fundamental retail operations, including inventory and merchandising.

"The best marketing in the world cannot sell a product that's not there," Hagopian said, adding that advertising can appear ineffective when the underlying problem is poor store execution or an out-of-stock product.

For retail media networks banking on 23% growth, closing the gap between ambition and execution — in measurement, competitiveness and in-store fundamentals — will determine whether this year's plans hold up.