Dr Daniel Knapp, Chief Economist at IAB Europe, presented Retail Media State of Play in Europe: Growth Between "Basics" and AI at DMEXCO on 23rd September 2026. The picture is of a channel adding around €3 billion of new spend every year, with the structure of European retail moving in its favour and AI arriving to accelerate it.
European Retail Media ad spend stands at €16.9 billion in 2025 and is forecast to reach €32.7 billion by 2030, a compound annual growth rate of 14.2 per cent, with growth easing from 18.5 per cent in 2026 to 10.5 per cent in 2030 as the base gets larger.
European retail has largely stopped growing in the way that matters to a retailer. Turnover has risen on price rather than demand, with the value of sales across the EU27 up 18 per cent and volume up 1 per cent, and margin has not followed, because higher costs of goods and staff absorbed the whole of the increase and left gross operating surplus slightly below where it started. Grocery, where European Retail Media is concentrated, was earning 4.4 per cent of turnover across the EU27 in 2023. A high-margin revenue stream built on first-party data and closed-loop measurement is one of the few levers left, and that is why Retail Media is so often the answer to a retailer's growth problem.
In the United States, Commerce Media accounts for 1 per cent of retail sales and quarterly retailer net income after tax has climbed from $23 billion in the first quarter of 2015 to $110 billion in the second quarter of 2026. Europe sits at 0.41 per cent of retail sales, so the mature benchmark is close to two and a half times the level reached so far. In France, Retail Media already takes 17.2 per cent of all advertising spend, ahead of Germany on 13.1 per cent, Spain on 11.2 per cent and Italy on 7.6 per cent, shares that exclude off-site Retail Media to avoid counting the same spend twice.
Dr Knapp placed the digital models side by side on a framework of targeting capabilities from Eric Seufert of Mobile Dev Memo, where Retail and Commerce Media sits top for strength of intent revealed through product usage, alongside general-purpose chatbots, above Search and well above the open web, social feeds and CTV. A shopper on a retailer's site has already chosen the category, the basket and the moment, so the inventory is sold against demonstrated intent rather than inferred interest.
Retail Media is talked about as a single product, and slot-level data covering 72 retailers, more than 120,000 sponsored placements and over 1,300 brands across eight markets shows something else. The most intensive fashion and marketplace sites carry well over ten sponsored slots per search page while many grocers carry fewer than one, and some retailers put nine in ten of their sponsored slots at the top of the results while others place the majority at the bottom.
Underneath sits a choice between selling scarcity and selling reach, an auction or a showroom, and neither is wrong: a grocer with thin margins and a concentrated supplier base has good reasons to sell scarcity, a marketplace with a long tail of sellers has good reasons to sell reach, and the cost of that diversity falls on the advertiser.
In Germany, more than half of the advertisers observed ran sponsored products on just one retailer, and fewer than one in ten were active on four or more. The ones that go wide are the large multinationals, so the category has a global head able to afford specialist teams and bespoke measurement, and a very local tail that cannot.
When one retailer's sponsored product sits in the top slot and another's appears thirty results down, and attribution windows, incrementality methods and metric definitions differ from network to network, every extra retailer adds cost for the buyer. That friction is why most advertisers stay with one, and it caps the category at the budgets of those able to absorb it.
Standards do not ask retailers to adopt the same commercial model, since scarcity and reach can coexist; they make the two comparable, so a buyer can see what a sponsored slot is, where it sits, how it is measured and what counts as an incremental sale. IAB Europe publishes measurement standards for on-site and off-site Retail Media, covering both media and sales measurement, and retailers who meet them can be independently audited and certified. Incrementality guidance is aligned with IAB US, and the two bodies have jointly established common definitions and measurement standards for in-store. The aim is to lower the cost of the second, third and fifth retailer, so the long tail can buy Retail Media the way the head already does.
AI-powered advertising, meaning spend on platforms where AI controls targeting, bidding, budgets and optimisation with minimal human intervention, accounted for 6.0 per cent of all European media spend in 2025 and is forecast to reach 23.6 per cent by 2030, or 30.5 per cent of digital. Retail Media is well placed for that shift, because automated buying rewards the signals the channel already holds. Agentic commerce is moving at the same speed: of 425 commerce and Retail Media stories in the trade press between August 2025 and September 2026, 227 named an AI assistant, a retailer, or both, and from June 2026 the retailer stories outnumbered the assistant ones. The chatbots opened the shop and the retailers are taking it back.
Dr Knapp closed with John D. Rockefeller: "The secret of success is to do the common things uncommonly well." Coverage, ad load and the quality of the intent signal are the common things here, and the markets that do them uncommonly well will take the €3 billion a year.
