How to Overcome 3 Retail Marketing Challenges

“What’s dangerous is not to evolve.” – Jeff Bezos, Amazon CEO

Did you know Amazon lists over three billion products across 11 global marketplaces? This is per a recent report from Publicis Sapient and Salesforce that examined “the new rules of retail”. And though it says that others can’t compete on the number of Amazon’s offerings, the good news is it doesn’t put anyone out of the overall race.

It’s true that 81% of people will begin their hunt for a product online – and a large chunk begin that search with Amazon. Still, near half of all shoppers wish to shop in a physical store. Even the younger generation – of which half spends 10 hours online each day – prefers in-store shopping (58% of Gen Z to be exact). It’s why Amazon got a slow start into brick-and-mortar retail. The company knows, per a Forbes article, that “the future of retail is blended”. So, it evolved with strategy to meet one of many retail marketing challenges and give customers what they desire. As the article points out, a sole focus on e-commerce would put Amazon “missing out on all the ways a customer might want to shop.”

What Amazon has done – to be customer-centric – has been the primary pathway for its success and its guiding principle. Yet, in the process of diversifying, it’s been careful to connect the experiences of its marketplaces and physical stores. This ability is what the report has dubbed one of four “foundational retail truths”. And, it finds the average retailer scores less than two on a scale of one to five, meaning most fail at doing so.

Retailers today must be careful to provide the best possible experience. In fact, 80% of people deem the experience in dealing with a company as significant as its offerings. And, 67% say their expectations are higher than ever. Marrying the digital and physical presence may not be easy. But, there are other ways to evolve to meet retail marketing challenges and provide a top retail customer experience.

Retail marketing challenges overcome with experiential

The Right Experience Can Prevail Over These Retail Marketing Challenges

The headline of another Forbes article reads, “Bed, Bath & Beyond Boring,” leading up to the author’s take on why the home goods company’s CEO recently stepped down. Among the reasons, he cites falling short in its omni-channel experience, unlike Amazon. He also mentions an over-assortment within its physical spaces and poor merchandising, making shopping difficult. Yet, more important, he gets to the core of these issues. And, that’s lack of a “human-centered” focus.

He points out there’s little to no attention being paid to building emotional connections with customers. Part of this is having forgone anything experiential unless, he says, shoppers “enjoy the experience of getting lost and frustrated”. This is unfortunate since experiential retail or experiential marketing activations could turn the focus from the store’s downfalls to a positive experience. Instead, customers could take away a different memory and a better overall feeling for the retailer.

Retail brands are using experiential marketing to overcome big retail marketing challenges. One thing they have in common? They put humans at the center.

Keeping It Fresh

The Publicis Sapient and Salesforce report names one of “the new rules of retail” as a company’s ability to keep things fresh. This is because, as it reveals, 69% of shoppers expect new products when visiting a retailer, whether online or physical. For mono brand stores, this is usually easy to achieve. This is also the case for larger retailers with private label products or via collaborations with other brands, such as in the case of Target. The retailer recently teamed with Vineyard Vines to launch a Target-exclusive collection of clothing, accessories, and other goods. To introduce the line, and in celebration of summer, the big-box retailer recently hosted a pop-up shop at a NYC marina. A mobile marketing tour helped generate traffic to the shop, where consumers could enjoy mini-sailing lessons and beach-themed photo ops. They could also see and buy the new products, which sold out, becoming one of the most successful launches in Target’s history.

Amazon is taking another path, though similar, with its new ‘Clicks and Mortar’ stores, which showcase the offerings of up and coming digital brands. A pilot running in the U.K. gives brands of all kinds a chance to meet consumers and build relationships over a six-week period. However, physical retailers can achieve the initiative with less effort when giving brands floor space to host pop-up shops and keep things fresh.

carlsberg brand activation

Getting Personal

Another “rule of retail” per the report is to give meaning to your relationships with customers. This should be easy since consumers today actually want to bond with brands. Still, near 65% of shoppers say retailers don’t know them. With the amount of data available to retailers, it’s simply a matter of not getting to know them on a deeper level. The report advises this can be done through “stronger values-driven connections.” For example, Ace Hardware is said to have seen “a huge jump in revenue the month they targeted customers interested in birding”. It was a small interest group, but one that shopped four times more than other groups.

The report also reinforces the demand for personalization, such as loyalty programs or customization. Of the latter, it’s offered by four of the five top-performing retailers in some form. And other brands are getting in on the action. One of which is Clinique. The beauty brand stepped off the department store floor and into its first pop-up shop earlier this year. This was following the launch of Clinique iD, built on the customization trend. Upon entry, visitors used tablets to take a skin quiz and learn of their best moisturizer combination, which they could purchase. Following the consult, they could also take part in a virtual reality experience and travel with beauty influencers through Iceland. An article informs Clinique ID sales have “exceeded expectations in several markets”, possibly proving the effort’s ability to renew the 50-year-old brand’s relevance.

Winning the Second Sale

One might believe a positive first retail experience to be a positive indicator that same retailer will win the next. But, that’s not true. While the report finds half of shoppers will buy through a physical retailer the first time, 47% will then visit a marketplace, like Amazon, to make a repeat purchase. So it urges brands to evolve with “new reengagement strategies”.

A new Yes Marketing report focused on retail tells of the power of exclusivity. For almost a quarter of consumers, that’s getting early access to new products. For near 20%, it’s as simple as exclusive promotions. But, it’s really just as easy as giving them a reason to come in since the former report shares, “70% of shoppers prefer to leave a store with a product-in-hand.” It’s why specialty retailers like Sephora offer AR experiences and regular workshops. And it’s why a department store like Selfridges seeks to reach various audiences through such events as yoga classes, debates, and beauty experiences. These brands know complacency can kill even the oldest retailer. And that makes it necessary to evolve their shoppers’ experiences at every turn to overcome retail marketing challenges.

At Elevate, we have the people you need to provide the best retail customer experience. Learn how our brand ambassadors and product specialists can provide the human touch necessary to win shoppers.

Author: Nick Riggall


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