7 retail advertising trends for 2025: From Ulta to Sephora

Early retail advertising focused on print, radio and television alongside catching shoppers’ attention with in-store displays. In the 1990s, retail advertising saw a huge shift with the rise of ecommerce and retailers began to invest millions of dollars into online ads, sponsored content and social media marketing. 

Whether it’s buying online and picking up in store or seeing a new eyeshadow palette on Instagram and testing it out with an in-store makeup artist, over the last two decades online and in-store retail have merged significantly. 

The modern customer journey now weaves across digital and brick-and-mortar touchpoints with 73% of consumers saying they use multiple channels to help them decide on a purchase. While 72% of shoppers use their smartphones to check out reviews or compare prices when browsing in store. 

But from consumer purchasing decisions to the tech they use to shop, consumer behavior is always in flux and retail brands need to adapt quickly to meet consumers’ shifting wants and needs. In this post, I explore some of the latest retail advertising trends through the lens of some of my favorite retailers.

Let’s take a look at some of the most recent online retail advertising trends. 

Sephora online 

One of the first online retail advertising trends I’ll cover is the use of AI. AI in retail is predicted to reach $5.5 billion by 2030. 

Sephora’s Sephora Virtual Artist is a great example of the use of AI in the retail industry. This AI-based tool allows consumers to try on different makeup products across Sephora lines. The app uses facial recognition, allowing users to place and try out lipsticks, liners and more. Sephora enhances the experience and encourages users to browse more items by walking them through step-by-step tutorials on a range of beauty techniques from contouring to perfecting the smokey eye.

Virtual try-on tools like Sephora’s help drive sales by taking the guesswork out of beauty purchases. By allowing for instant shadematching in which facial recognition technology can easily match user’s skin tones to the right foundation shade, these tools can help consumers confidently make foundation and concealer purchases. While complementary suggestions can help retailers increase consumers’ average order sizes by triggering complementary product recommendations that complete the user’s look. 

Sephora also focuses on data-driven attribution and measurement, zeroing in on understanding and building omnichannel experiences across social media, mobile and their web-based platforms. Sephora tracks data across channels and uses it to preempt consumer behavior, creating unique personalized experiences based on each consumer’s individual buying journey — whether a consumer is ready to buy, doing product research, or planning to make a purchase later. 

Ulta 

95% of Ulta’s sales come from return customers and their personalized ad campaigns are a core part of their high customer retention rates. Ulta uses personalized ads, supported by machine learning and customer data, to personalize content, promos and content.

With 44 million loyalty members, Ulta Beauty has the most in-depth dataset in beauty, giving the brand access to extensive customer data they can use to effectively personalize their ads. 

Ulta uses Adobe’s CDP (customer data platform) to help create automated personalized content across their channels in real time. Retail brands typically use CDPs to break down data silos and collect, centralize and analyze customer data from several disparate sources. CDPs act as a single source of truth: creating detailed, unified customer profiles based on the data they ingest. These profiles give retailers detailed insights into customer preferences, behaviors and brand interactions — helping them to quickly and effectively personalize ad campaigns. 

“Our insights show that beauty is deeply personal and is intrinsically connected to emotional and physical well-being, so we recognise the importance of delivering the most personalised experience for each of our guests based on a deep understanding of their preferences at an individual level. With Adobe as our partner, we’re tapping into data and insights from our more than 44 million loyalty members to deliver personalized experiences at scale. Our goal is to create joyful, meaningful interactions at every step — interactions that inspire brand love and keep our customers coming back.”

— Kelly Mahoney, SVP of Customer Marketing, Ulta Beauty

Ulta notes that they’re focusing on collecting more in-depth personal data from consumers — going deeper than product preferences, buying histories, and online interactions. Beyond optimizing personalization efforts to generate more clicks or revenue, Ulta says they are looking at personalization in a deeper way — focusing on how they can use data analytics and machine learning to analyze personal data to optimize for lifetime value. 

That means putting the focus on creating experiences and content that engages and supports consumers in their beauty explorations — rather than simply pushing them to make another purchase as quickly as possible. Think: helping them perfect their skincare routines, find shades that suit their unique colorings and experiment with new looks and techniques. 

"We need to go “back to the future” and nurture an individual, personalized relationship with the customer, just like retailers used to do in the old days. But to do that today, we need data-driven insights and technology, as well as the right mind-sets in our people."

- Alain Bejjani, CEO of conglomerate Majid Al Futtaim

Learn about shopper insights and how to use them in our past post. 

Walmart 

​​89% of consumers say they check online reviews as part of their online buying journey. Walmart is tapping into this powerful form of social proof by placing influencer video content on their website. Currently,  Dove’s Pink Beauty Bar on its Walmart product pages is a great example of this. This placement has helped generate nearly 3,000 reviews!

Currently, Walmart has a network of over ten thousand online influencers from micro influencers to those making six figures through their social media followings. Three years ago, the retail merchant filed trademarks for “Walmart Creator” and “Walmart Creator Collective.”

Check out one of the Walmart Creators videos here.

Retail brands are also experimenting with newer forms of content popular with consumers. In 2024, Walmart branched out into influencer-based podcast campaigns. These campaigns feature “dedicated moments,” in which podcast hosts share testimonials about a diverse-led product at Walmart stores or on Walmart.com, interviewing the founder during the program. Products typically match the diversity seen within each podcast’s audience — from ethnicity to gender. 

D.J. Vaughn, director of multicultural media partnerships at Walmart, notes that these features focus more on connection than heavy promotion. He says:  “We’re having these sorts of authentic conversations, but we’ve also been intentional about making sure that it’s not just a product push."

In-store retail advertising trends

Let’s jump into some of the most interesting in-store retail advertising trends. 

Nordstorm 

Nordstrom promotes their brands by pairing them with in-store stylists who can help guide consumers to new product lines while shopping in store or browsing for new clothes across their socials. 

Nordstorm’s stylists work closely with their brands to create content and promote it across paid channels like paid social. Many of Nordstrom’s stylists are also online creators and influencers — connecting with consumers through storytelling and personal recommendations. Nordstrom reports that their stylist-based content has seen double the engagement when compared to their traditional content. 

VP of Nordstrom Media Dunford says: 

“In traditional retail media, the creative is pretty much plug and play, like a standard asset that you put everywhere. You may put a logo on top of it, and that’s kind of it. That’s not delivering on telling your story to the customer. And so we’ve created an offering within our retail media where we have a really good creative agency where we’re co-creating content with our brands. We sit down and say, ‘What are the stories we want to tell?’ and we brief the creative agency and deliver that creative both in video — like long-story formats that we can use in things like CTV — and also in more compelling social assets.”

Dunford says Nordstrom's retail media campaigns also zero in on immersive in-store experiences as the retail giant helps make sure they continue to create the kinds of engaging, inspiring in-store experiences and displays that younger consumers look for. He says:

“With the younger customers, they’re craving for a tangible experience where they can be inspired. So we’ve done things like creative, visually immersive experiences that when our customers are shopping, it makes it more engaging and fun and you have better discovery and inspiration.”

Last winter season, Nordstrom’s NYC flagship created a memorable immersive display that connected with consumers’ nostalgia and brought in playful elements to help drive their seasonal sales. The Blizz on 57th Street display was part of the store’s Wonder All the Way campaign. The display featured an inflatable character called Mr. Blizz, who presided over the store entrance and had the magical ability to turn store objects into characters. 

Characters included Pigeonthia (voiced by John Waters), a pigeon who could foresee the future and Wonder Ring (voiced by Fran Drescher), a lost engagement ring placed by an interactive token-operated machine that distributes rings that include each visitor’s fortune. 

Sephora in-store 

Location-based advertising is on the rise. Currently, 75% of retailers use geomarketing to promote their products and services.

Sephora uses beacons in their stores to send notifications about local offers and in-store products alongside beauty tips to customers' devices when they enter a store. Sephora’s strategy is a great example of how a retailer is combining both location-based advertising with mapping the customer experience across online and offline channels to bring in more sales.

Bridget Dolan, vice president of Sephora‘s Innovation Lab, San Francisco, CA says: 

"We focused our Beacons messages on being truly relevant and useful for customers in-store, giving them a customized, personal shopping experience,” Ms. Dolan said. “When a shopper comes into Sephora, she will be prompted to switch her app to ‘Store Mode,’ allowing her easy access to all of the features she needs while shopping, like the ability to scan products for ratings and reviews, look up past purchases, view her Œloves’ wish list, and pull up her scannable loyalty card and saved gift cards, saving her an additional step at check-out. It also rewards pre-shop efforts by popping up the items she’s left in her cart that are available in this store."

Sephora has seen impressive YoY growth, outperforming many of their competitors with analysts noting that personalized in-app shopping experiences have significantly driven this growth in-store.

Selfridges 

In July, Selfridges and Snapchat launched an augmented reality (AR) locker room to celebrate a summer of sport in their London Oxford Street store. 

The pop-up allowed shoppers to virtually try on different sports kits. Anyone who used the AR mirror could save their looks to their phones and share them on Snapchat. 

Selfridges’ approach is a key example of retail’s shift towards phygital experiences that blend consumers’ online and in-store experiences. 

Phygital experiences are essential for creating a more cohesive, personalized customer journey across channels. This approach mirrors the modern consumers’ buying journey as they frequently jump between online and offline channels. The average person typically interacts with six to eight touchpoints, both online and offline, before making a purchase

Retail brands are intertwining the digital with the brick-and-mortar shopping experience in a number of ways — from storing customer’s payment details on in-store systems to buying online, pick up in store purchase options. 

PWC explores how AI and virtual reality (VR) experiences can help enhance and better personalize the phygital shopping experience in store using current customer data:

“A customer walking into your store is greeted by an AI-driven styling assistant on an interactive screen, which suggests outfits based on their recent purchases and previous online browsing history. As they browse through your store, dynamic product displays change to highlight items that complement what’s already in their tote, complete with rotating mannequins showcasing real-time mix-and-match options tailored to their style.

In a special section of the store, customers immerse themselves in a brand experience zone where they can interact with the latest fashion lines through augmented reality platforms. They try on different outfits virtually, see how they pair with accessories and make selections that feel tailor-made for their personal style and preferences.”

H&M

H&M unveiled a hologram display at its Williamsburg store in Brooklyn as part of the H&M Move concept, bringing together an engaging brick-and-mortar store experience that includes dance and exercise classes from creatives at Grind House and Good Move. The hologram display shows lifesize, high-definition holograms of instructors in outfits from their Move athletic line.

Holograms can help deliver an "otherworldly" immersive experience to in-store shoppers, providing a more engaging experience in store. Hologram digital signage can increase in-store engagement and sales by 45%.

H&M’s holographic storefronts highlight a wider trend of retailers using “retailtainment” to bring more customers in store and encourage purchases by bringing elements of the entertainment space into the retail environment. 

Writing for The Drum, Garry Williams covers some of retail's best interactive displays. He says: 

"Window displays are also proving to be a key area that brands can optimize for entertainment. Ikea Harajuku launched an intriguing campaign by creating an apartment for virtual influencer Imma as part of their shopfront, where she lived in front of curious shoppers for three days, while Samsung’s hands-on interactive window displays at KaDeWe in Berlin are another example of pure fun for shoppers, offering everything from art installations to a gamified toy machine."

Interactive displays and in-store events are two of the most popular examples of retailtainment experiences retailers are using to pull in more customers. The Airmax Listening Room in the Niketown London Store is one of my favorite examples of retailtainment, where shoppers get matched with a unique track based on their personality. 

And retailtainment continues to prove successful with researchers finding that 80% of consumers are more likely to make a purchase after an enjoyable retailtainment experience.

Like other retailers on our list, H&M is also heavily leaning into the personalization trend. The brand is currently mirroring the personalization consumers see online in-store with smart mirrors that offer personalized product recommendations based on the items shoppers bring into the fitting room. 

As a retailer, it’s important to build a unified omnichannel advertising strategy that supports the customer journey and creates a seamless experience across multiple touchpoints. 

Start by mapping the customer journey: researching and tracking the touchpoints your average customer engages with when researching and moving towards purchasing a product. 

Do they jump from TikTok to your desktop site, then read reviews in-app and on third-party sites before deciding to browse and buy in store? Run through an audit to understand how consumers experience the customer journey — can they easily move between channels? Are there any frustrating aspects of the experience? Is there any touchpoint that fails to properly nurture and support them as they move through the customer journey? Are any channels hard to navigate? Are you missing advertising opportunities on any of them? 

The right tools can make it easier to bring together your customer data and map the customer journey. You can use a CDP like Ulta to centralize your customer data and create detailed, unified customer profiles using data from a range of sources including your site, CRM and other third-party tools. 

You can enrich your understanding of consumers’ omnichannel experiences by undertaking quantitative and qualitative research like surveys, interviews and focus groups. Use a connected consumer insights platform like Zappi to pool and analyze consumer data from various sources, tracking their behavior, likes and dislikes, trends and more to maintain a pulse on your target audience. 

You can also use Zappi to test concepts and messaging to help improve the likelihood that your campaigns will be a success and better optimize your ad spending. With a centralized platform, you can store and analyze your research data from a single platform — further enhancing the 360-degree view of consumers your CDP provides. 

Both CDPs and consumer insights platforms can help you track real-time data and create informed, testable hypotheses on future consumer behavior — allowing you to optimize your advertising across channels by preempting future consumer behavior and needs. 

Find out more about the AI advantage in consumer insights in our past post. 

From immersive experiences to creative uses of AI, retailers are experimenting with new ways to advertise to consumers across channels, mirroring the modern customer journey that moves easily between digital and offline channels.