For all the talk about retail media’s rapid rise, one piece of the puzzle still doesn’t get enough airtime: ad servers. These systems decide the winner of each ad auction—in short which ad gets shown, where it appears, and how performance is tracked—but many networks and advertisers are still navigating common industry challenges when it comes to understanding and optimizing these technologies.

As Mark Burton, Pentaleap’s Chief Product Officer, puts it: “When it comes to sponsored products, ad serving is the most complex—and probably the least understood.”

Let’s explore why ad servers are critical, what networks need to control, and what advertisers should demand in today’s retail media landscape.

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What Are Ad Servers in Retail Media?

At their core, ad servers are responsible for deciding which ads appear, where, and when. They deliver and optimize ad placements in real time—whether on a retailer’s own properties or across third-party platforms.

While offsite environments (like Meta or Google) rely on platform-controlled ad serving, this article focuses on onsite ad servers—those used directly on a retailer’s digital shelf. In onsite environments, retailers bring in ad-serving technology they can control.

Systems like Pentaleap’s Fluid Ad Server determine which sponsored products appear in search results, category pages, or product detail pages, based on factors like product relevance, quality scoring, availability, and more.

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Common Ad Serving Challenges

But when ad relevance falters, retail media networks face real consequences: poor shopper experiences, reduced advertiser confidence, and lost revenue opportunities. These challenges don’t just hurt advertisers—they limit a retailer’s ability to drive sustainable growth in their media business. Consider some of the biggest roadblocks:

Ad Servers Weren’t Built for Retail Media

Retailers are continuously advancing their personalization efforts. Yet, many ad-serving technologies in use today were initially designed for different advertising environments. As Mark Burton explains,

“Many major ad servers have their roots in programmatic advertising on the open web. They are highly scalable, highly reliable, and have enabled the massive growth in onsite retail media. However, they were built with different speed and relevance standards than retailers expect of their own eCommerce infrastructure. What’s more – most of them were not built to natively harness the power of retailer’s own data in real-time.”

Ads that take a long time to load and aren’t truly relevant to the shopping context can miss out on potential engagement, and risk slowing sites down.

Traditional Auction Dynamics: Not Built to Prioritize the Customer Experience

While quality scoring has always been part of the mix, the same lack of real-time relevance often means that bid takes precedence. This dynamic can favor larger advertisers, making it more challenging for brands with highly relevant offerings to gain traction.

Classically, the purpose of a programmatic auction is to find the highest-quality bidder for a given audience or placement. On the open web, that usually works well enough—seeing a watch ad on a news site might not be perfect, but it’s acceptable. In retail, though, the stakes are higher. You’ve got a shopper at the digital shelf looking for bread—and instead, they’re shown an ad for chicken.

That mismatch isn’t just irrelevant—it can erode trust and usefulness.

Retailers need ad-serving technology that prioritizes shopper relevance and SKU-level optimization—without compromising auction integrity.  

Duplicate Ads & Poor Targeting Undermine Shopper Trust

Many retail media networks struggle with ad-serving systems that fail to seamlessly integrate into the shopping experience. This can lead to:

• Duplicated ads appearing on the same page, disrupting the browsing flow

• Irrelevant placements that make shoppers less likely to engage

• Lower overall click-through rates and media effectiveness

Retailers must ensure that their ad-serving infrastructure supports precise targeting and seamless ad placements—otherwise, they risk lower shopper trust and diminishing advertiser satisfaction.

Retailers Need More Control Over Their Ad Inventory

Even the most robust ad servers weren’t originally designed with retail media in mind. While they’ve played a crucial role in scaling onsite programs, their inner workings can sometimes feel like a black box—making it difficult for retailers to fully optimize outcomes. As Mark Burton puts it:

“Onsite ad servers deliver billions of impressions every day directly to retail customers, but the decisioning and data available to retailers can sometimes be too opaque. Without deeply understanding their ad server mechanics, it’s tough for retailers to know if they’re getting the best outcome for themselves and their customers.”

This lack of clarity can lead to inconsistencies between the promise of “relevant ads” and what teams actually experience day-to-day. Messaging like “unrivalled AI precision” sounds great on paper—but without transparency into how winners are chosen, it’s hard to evaluate performance or course-correct when needed.

That’s why it’s increasingly important for retailers to lift the lid, ask the right questions, and ensure their ad server is working in service of their goals—not just delivering impressions, but delivering relevance and revenue.

Flexible, transparent ad-serving solutions give retailers more control over how inventory is sold, how shopper needs are prioritized, and how decisions are made—while still preserving the scale and reliability ad servers are known for.

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How Pentaleap’s Fluid Ad Server Addresses These Challenges

Advertisers demand control, retailers seek efficiency, and customers expect relevance—yet few available solutions fully align with these priorities. Pentaleap is addressing these common challenges by rethinking ad serving through a retail-centric lens.

Harmonizing Organic and Sponsored Content

Customer experience is key. Mark explains: “We always talk about retailers and advertisers, but the customer is the most important point in this triangle. They come to your site to buy products, not to click on ads. If the ads are highly related to what they’re looking for, it’s win-win. But when they aren’t relevant to the customer context, it’s an all-round bad outcome. The ad won’t get clicked, you’ve given up a premium slot for something irrelevant, and the customer can feel like your range does not meet their needs.”

By ensuring that organic product recommendations and sponsored placements work together seamlessly, Pentaleap’s solution elevates the shopping experience and boosts engagement.

Embracing SKU-Based Bidding

Pentaleap supports SKU-based bidding, streamlining the campaign setup process and providing all advertisers—especially smaller brands—a more accessible path to participation.

“The easier it is to set things up, the easier it is to actually get campaigns going. Brands have to handle so many media platforms – media platforms need to make setup as frictionless as can be.” Mark notes.

Balancing Revenue with Shopper Experience

Ultimately, the future of retail media hinges on balancing automation with control. Pentaleap’s Fluid Ad Server represents a shift towards an ad serving model that prioritizes relevance and efficiency over conventional auction mechanics.

“By optimizing for relevancy rather than relying on traditional auction dynamics, we’re making advertising work better for everyone,” Burton says. “It’s not just about who bids the most—it’s about what makes sense for the shopper.”

In a digital advertising landscape under constant evolution, this balanced approach is not just innovative—it’s essential.