How Can Your Retail Brand Compete Against Amazon?

Recently, Amazon made another huge leap in their brand journey, eclipsing a market value of over $1 trillion. This places them firmly alongside Apple as the only two companies in this staggering space. Amazon provides its customers with unprecedented convenience, product selection, all matched with above-average customer service and a beloved Prime loyalty program. Amazon has changed the face of the American retail industry, forcing brands of all sizes and styles to complete self-assessment in the face of this retail juggernaut. As a result of this hegemonic dominance, retail brands are being pushed towards new directions, operating creatively as an attempt to provide a niche value of which Amazon’s size does not allow them to match. How is your retail brand positioning itself to compete within these rapidly-shifting parameters?

Unsurprisingly, the biggest slice of Amazon’s pie is online sales. Customers can log on to their marketplace and access products across every industry, provided by third-party vendors or Amazon themselves. In fact, Amazon’s 2018 online sales will account for close to 50% of all online sales spent in the United States, up close to 30% of their share from 2017. This staggering statistic cements Amazon’s place as the online retail world-leader but it does not mean that there is no room for your brand to compete. Organizations that provide a unique, individualized value to their customers, both within their brick-and-mortar locations and online, will always have a place in this landscape, because the sheer size of Amazon prevents them from reaching individuals in this fashion.

There is a common perception that as consumers become more married to these evolving digital channels, brick-and-mortar stores will soon be obsolete. These soothsayers point to the 8,600 retail stores that shut their doors in 2017 as proof that a stark transition is taking place, but these numbers are not as clear as they may seem. In fact, a large portion of the store closings were the same 16 brands and there was a net increase of 4,000 stores in that same year. What this means is that while Amazon has maintained a massive stronghold, there is still a place for your retail brand to exist.

The key to keeping your brick-and-mortar stores running is providing a unique value that only your organization can offer. In action, this means designing a store aesthetic with your target customer’s desires and interests in mind, training employees to value individual customer satisfaction over sales numbers and a digital identity that works in-tandem with your different locations. Amazon will always be able to offer cheap alternatives to any product, but for many consumers price is not the only factor driving purchasing decisions. For example, Warby Parker, the online eyewear brand, has opened up brick-and-mortar locations across the country. Each store has unique geographic identifiers that align it with the city they encompass and the consumers they service. For example, the Detroit location has a Vernor’s fountain drink station, and the floor plan in the Miami location is designed so that as customers stroll throughout the store, it looks like they are hanging out in a pool. By transitioning the brick-and-mortar model from a transactional model towards an experiential haven, Warby Parker is establishing a unique footprint in a post-Amazon world.

Another brand that can be used as an example for competing in this evolved retail landscape is Bonobos. The clothing retailer has opened up ‘guideshops’ that are meant to capitalize on the ‘try-in-store, buy-online’ trend sweeping American consumers. Bonobos has brick-and-mortar locations dedicated solely to providing exceptional value and service to consumers and are specifically not a place where consumers can walk out with a bag of goodies. Customers can receive free delivery by purchasing ‘in-store,’ but otherwise, it is simply a place to receive expert fashion advice and physically interact with the product, something that Amazon is not currently set up to provide.

Amazon can serve as a role model for companies hoping to optimize their digital retail channels, but it is also a major competitor within every product category. They have a massive share of the market and consumers are strikingly loyal due to low price points and unparalleled convenience. To stand out in the current atmosphere retail brands must take a long look at themselves in the mirror and figure out WHY customers should choose them. Once you have figured out your unique ‘why,’ create a company culture that trains employees to provide this niche service and invest in your infrastructure to match this evolved perception. Amazon is going to be a major player for a long time, meaning that brands need to adjust and figure out a way to remain relevant.

1 https://www.nytimes.com/2018/09/04/technology/amazon-stock-price-1-trillion-value.html

2 https://techcrunch.com/2018/07/13/amazons-share-of-the-us-e-commerce-market-is-now-49-or-5-of-all-retail-spend/

3,4,5 https://www.fastcompany.com/40491567/the-future-of-retail-in-the-age-of-amazon

Competing with Amazon FAQs

How can retail brands compete with Amazon?

Retail brands can compete with Amazon by offering personalized customer experiences, focusing on niche markets, leveraging local presence, and building strong relationships with customers through loyalty programs and exceptional service.

Why is customer experience a key differentiator?

A personalized, high-quality customer experience can set brands apart from Amazon, fostering customer loyalty.

How can brands leverage their physical stores?

Brands can offer in-store experiences, such as faster pickups and customer service, that Amazon cannot match.

Second To None empowers customer-centric brands to deliver consistent, intentional and authentic consumer experiences.

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