Brands are at a crossroads: Should they prioritize on-site ads that capture high-intent shoppers at the point of purchase, or go off-site to cast a wider net across social, video, and display networks?

Brands and retailers alike are constantly refining their strategies to stay ahead, but with so many channels and formats to consider, which approach truly drives the best results?

More importantly, how do these advertising methods impact the retail media landscape as a whole?

Spoiler alert: It’s not an either-or scenario. The future of retail media is a strategic blend of both.

On-Site Advertising: The Power of Intent

Let’s start with the tried-and-true hero of retail media—on-site advertising. These are the sponsored product placements, banner ads, and search results that appear directly within a retailer’s ecosystem.

The primary advantage? These ads reach consumers precisely when they are in shopping mode.

A well-placed, well-timed product ad can nudge a customer toward conversion right when they are considering a purchase.

According to eMarketer, onsite retail media accounts for approximately 80% of the $150 billion retail media market and is projected to remain the dominant force for years to come.

Why On-Site Works

1. Right Place, Right Time

When a shopper is browsing a retailer’s site, they’re not just thinking about buying—they’re ready to pull the trigger. An ad at this moment isn't an interruption; it’s a nudge. That’s why on-site retail media drives a higher return on ad spend (ROAS).

2. First-Party Data Goldmine

With third-party cookies on their way out, first-party data is the holy grail. On-site ads leverage real shopper behavior, search history, and past purchases to serve ultra-targeted promotions—no privacy concerns, just precision marketing.

3. High Margins for Retailers

Unlike social or programmatic ads, on-site placements run on a retailer’s owned-and-operated real estate. That means fewer fees to third-party platforms and profit margins reaching up to 90%.

The Catch? Limited Inventory

On-site ad space is finite. Even for major players like Amazon and Walmart, the number of available placements is capped. That’s where off-site advertising comes in.

Off-site Retail Media: Expanding the Retailer’s Advertising Footprint

Off-site retail media extends a retailer’s ad reach beyond its own website—onto social platforms, video networks, and publisher sites. Think of it as digital billboards for retail brands.

• The Offsite Boom: According to Insider Intelligence, offsite retail media spending is expected to grow by 31% year-over-year as brands move beyond search ads and diversify into video and programmatic display.

• Retailers Leading the Way: Major players like Walmart Connect, Roundel (Target), and Kroger Precision Marketing are scaling off-site advertising through retail media networks (RMNs), helping brands retarget shoppers across high-traffic sites like YouTube, Hulu, and Instagram.

Why Off-Site is Gaining Momentum

1. More Formats, More Engagement

Video ads on YouTube, interactive banners on top-tier publishers, CTV commercials—off-site ads are dynamic and immersive, creating more brand recall than a standard search result.

2. Beyond the Digital Shelf

Not every shopper starts their journey on a retailer’s site. Some begin on Google, Instagram, or even watching product reviews on TikTok. Off-site advertising ensures brands can meet shoppers where they are, not just where they buy.

3. Larger-Scale Campaigns

While on-site ads rely on retailer traffic, off-site ads remove that limitation. This is especially beneficial for retailers with strong in-store presence but less eCommerce volume.

The Trade-Off? Cost and Complexity

Off-site ads introduce additional expenses—think ad network fees, attribution challenges, and potential data-sharing restrictions. Plus, measuring direct conversions is trickier compared to on-site placements.

A Balanced Approach: The Future of Retail Media

While some may view onsite and offsite retail media as competing strategies, the most successful retailers see them as complementary. A well-executed retail media strategy seamlessly integrates both approaches to create a full-funnel advertising ecosystem.

How Onsite & Offsite Work Together

• Onsite Ads Drive Immediate Conversions – Onsite placements target high-intent shoppers in the final stages of the buying process.

• Offsite Ads Build Awareness & Consideration – Offsite placements reach new audiences before they actively start shopping.

• Retailers Use Offsite Ads for Retargeting – Amazon and Walmart Connect use offsite ad campaigns to retarget shoppers onsite, increasing return on ad spend (ROAS) by up to 35%.

• Cross-Channel Attribution Unlocks Full-Funnel Visibility – Instead of relying on last-click attribution, brands are adopting AI-powered, multi-touch attribution (MTA) models to track how offsite impressions contribute to onsite conversions.

Brands like Nike and L’Oréal already blend offsite brand storytelling with onsite conversion-focused ad formats, proving that a hybrid approach is the future of retail media.

The Bottom Line: Takeaway for Retailers

Retail media is set to surpass $177 billion by 2028, and on-site ads will continue to command the lion’s share. But as retailers embrace off-site, expect smarter integrations, cross-platform retargeting, and full-funnel retail campaigns that blur the lines between eCommerce, social, and traditional advertising.

At AdButler, we help retailers and brands bridge the gap between onsite and offsite media with cutting-edge solutions that drive measurable results. Stay tuned for more insights as we continue to shape the future of retail media.