Forget the Goliaths, let’s look at the Davids: Target Roundel as a guide to RMN growth


When discussing Retail Media growth and market size, the reality is that these rosy forecasts often stem from aggregate numbers driven by Amazon Advertising and, in the US, the rapid growth of Walmart Connect. Walmart Connect saw 28% year-over-year growth in 2023, and advertising now accounts for almost a third of Walmart’s $6.7 billion profits.

But what about retailers below the giants Amazon and Walmart? It isn’t fair to compare other retailers directly to Amazon or Walmart, the largest online and brick-and-mortar retailers in the world. The disparity is simply too large.

Instead, let’s look at one of the ‘Davids’ rather than the ‘Goliaths’ Amazon and Walmart.

Target Roundel Results as an Indicator

For non-grocery-based Retail Media Networks, Target’s Roundel is an interesting case study to examine. It’s big—but not at the scale of the ‘Goliaths’.

Target is the seventh-largest retailer in the world, with revenues of $106.6 billion in 2024, slightly down from $107.4 billion in 2023. Target has almost 1,900 stores in the US, employs over 450,000 people, and its website attracts over 180 million visitors per month. Target’s core product categories are apparel and accessories, food and beverage, “hardlines” (appliances or sporting goods), home furnishings and décor, beauty, and household essentials.

Target’s retail media network, Roundel, positions itself more as a marketing agency collaborating with third-party media and advertising firms, rather than as a pure retail media play.

Roundel’s revenue growth is positive: in 2024, Target’s ad business generated $649 million in revenue, up 25% from $522 million in 2023, representing about 6% of total revenue.

“From its humble beginnings in 2007 with just five team members and known as online vendor marketing, Roundel is now a 500-plus-person-strong fully integrated Target team,” says Target Executive VP and CMO Cara Sylvester.

Cara Sylvester says that Roundel could double in size in the next five years. As Ad Exchanger point out, three years ago, the Walmart Connect ad business had ad revenue of $700 million in 2022, a little more than Target’s Roundel in 2024. Last month, Walmart reported its 2024 ad business at $4.4 billion. Growing Roundel from $650 million to $1.3 billion by 2030 appears achievable.

What Changes is Roundel Making to Double Revenue?

Roundel offers six broad advertising propositions—Target product ads, search ads, social ads, display ads, programmatic advertising, and CTV—but has recently introduced important strategic shifts that offer valuable direction for other Retail Media Networks:

  1. Roundel historically focused on a managed-service model but is now shifting toward a self-service model. Roundel Media Studio is their self-service platform for managing Target Product Ads (their sponsored product proposition).
  2. Roundel Media Studio is introducing new advertising inventory units such as “More to Consider” and “Frequently Bought Together,” enhancing relevance and personalisation.
  3. Target is launching a paid membership program similar to Amazon Prime, bundling Target loyalty with its Shipt delivery service.
  4. Roundel is changing its sponsored-product offering from a first-price auction model to a second-price auction model, aligning with Amazon, Google, and Walmart.
  5. Roundel offers Kiosk, Target’s closed-loop reporting tool, competing with Walmart’s renamed Luminate (now called Scintilla) and Amazon’s Marketing Cloud.
  6. Roundel is reportedly developing new creative formats on-site, sharing signals with off-site partners, and introducing objective-based buying—leveraging purchase data and customer insights to optimize campaigns.
  7. Target has a robust marketplace proposition, Target Plus, increasing traffic and the number of potential advertisers. Unlike Amazon’s open 3P Marketplace and Walmart’s invite-only marketplace, Target selectively chooses sellers to ‘digitally extend their aisles,’ seamlessly integrating marketplace products into Target.com. Customers do not perceive marketplace products as separate; items shipped from vendors simply appear as line items on receipts.
  8. Target has prioritized enhancing the quality of its first-party data. Target’s audience data reaches more than 165 million anonymised customer IDs, offering advertisers a highly affluent, high-intent, and loyal customer base, according to ad buyers.

Can Other RMNs Copy the Roundel Approach?

Roundel’s approach—expanding inventory, enabling self-service, increasing marketplace-driven revenues, and introducing new creative opportunities—is a viable strategy for smaller Retail Media Networks (‘Davids’) to emulate, even if they don’t have Target’s scale or its 165 million first-party data profiles.

But where should smaller RMNs start?

Drew Cashmore, a former Walmart Connect executive now with tech provider Vantage, makes a crucial point: simplify the advertiser’s buying experience.

Cashmore explains, “The smaller players are trying to figure out how to compete against the well-funded tech architecture of the Walmarts and Amazons of this world. Retailers need to make it easier for advertisers to buy because they can’t match the investment Walmart made building its media business.”

This highlights the core challenge for smaller RMNs: few can afford the armies of developers, data scientists, and AdTech specialists that Walmart and Amazon deploy.

What’s the solution? There’s only one realistic approach: partner.

As Cashmore says, “Smaller players must turn to outside companies to streamline all the spreadsheets, email chains, and fragmented software systems previously used to manage retail media. What’s changed recently is the growing recognition of the need for better partnerships.”



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