The Future of Pop-Up Retailing + 7 Ways to Successfully Launch a Pop-up Shop

May 7, 2014
| 499 Comments
adidas-Originals-StanSmith-pop-up-launch-event-event-imagery-33

Pop-Up retailing is one of the hotter trends in retail today, mainly because sales are down and the availability of temporary space is up-in most markets, way up!
That combination naturally sets the stage for some form of innovative retailing exercises. Pop-Up is also sometimes called “flash” retail because it comes up in a flash and is gone in a flash. Essentially, it’s a blend of retail and event marketing made possible and popular by a weak real estate market.

The basic principle is the same no matter what you call it. Find an empty space and do something interesting with it. That something can range from making exclusive products available in unusual places (for the brand) to trying out a new store or product concept to creating another weapon in the buzz-generating arsenal of retailers and brand marketers alike. Even the ever-present and traditionally door-to-door cookie sales force, the Girl Scouts, are catching and signing on to the phenom with Pop-Up shops in NYC.

The first public commentaries and observations on this emerging trend go back at least seven years, which means the trend actually goes back at least eight years or more. In retail, half a decade is a lifetime, so perhaps Pop-Up isn’t quite as shiny and new as it seems.

As we see it, Pop-Up is still in its 1.0 stage, largely opportunistic and exploitative. One thing we do know about Pop-Up is that its roots lie in seasonal industries: Christmas- or Halloween-centric stores making use of unrented spaces to do business without the commitment and overhead of a rental contract.

In its current form, Pop-Up 1.0 has room for the application of strategic planning; it is more of a tactic than anything else. Promotions and events are one-offs that can certainly boost sales. Strategic Pop-Up 1.0 is something else because it can create upticks in sales figures, while also promoting the brand in ways that conventional retail practices, marketing, and advertising can’t.

Here are some examples of the broader marketing issues that Strategic Pop-Up 1.0 can address as it evolves:

Grid-Expander Pop-Up 1.0
On the one hand, we know that the typical shopper does the majority of his shopping within a self-defined geographic grid; shoppers won’t travel more than some specific distance, and in some cases, they won’t travel in a particular direction no matter what the distance. The distance within this grid is conditional and unique for different types of stores. On the other hand, we know that shoppers will drastically change their behavior for the right incentive. This implies that shopper flexibility exists under the right conditions.

Problem to Solve:
Increase individual store sales by expanding beyond the natural geographic footprint. Your store is beyond the natural grid of a large base of prospective customers but putting in a new location just isn’t economically or operationally practical.

Solution:
Lay out the logical geographic grid of the market in which you are trying to develop. Find a temporary location roughly halfway between your current location and the center of the prospective market. Set up a brand experience satellite store with a scheduled rotation of key departments to provide the new market with a taste of what it would be like for them to extend their range to include your existing location. Repeat the Pop-Up experience in each compass direction to completely cover the target market over a 12-month period.

Bonus:
If your experiment provides enough response, it may highlight the feasibility of a new location and reveal the best geographic location for the new store.

Nomad Pop-Up 1.0
In today’s saturated market, even the best retailer does not experience a 100% trial rate from prospective shoppers within their prime marketing area.

Problem to Solve:
Increase sales by increasing market penetration within current geographic territory.

Solution:
In the same way that nomadic sheep herders go where the grass is greenest, the nomadic Pop-Up takes the store to the shoppers. The strategy provides repeated sampling opportunities without the commitment of a fixed location. The nomadic Pop-Up strategy involves subdividing your prime market area into targeted zones, each of which may represent somewhat different demographic or psychographic shopper opportunities. Its execution involves “putting your best foot forward” in that zone by matching the most appropriate aspects of your store with the specific zone of your market area. A nomadic Pop-Up cycle could involve showcasing specific departments or specific merchandise lines that are most likely to entice the residents of a particular zone to make the trip to the main store.

Shopper Community Connections Pop-Up 1.0
It is becoming increasingly difficult to build store/brand loyalty through conventional media and marketing channels. Shoppers have too many choices for them to commit exclusively, or even strongly, to one brand above others. It is no longer enough to rely on the in-store shopping experience to create that kind of intimate connection between those prime customers and the marketer. Instead, smart marketers must create richer relationships with their key shoppers. Under normal circumstances, marketers can’t be sure of being at hand when key customers are most likely to need them.

Problem to Solve:
How to meaningfully connect the store/brand to the lives of its best customers outside the store at the moment when they are most inclined to consider a purchase or are most sensitive to thinking about what the marketer has to sell.

Solution:
Put the right solution within arm’s length of the best customers at the moments when they are most open to buying something from us. What we want to happen is not simply an added opportunity to sell product and increase revenue (although that is always nice). What we want as an outcome is for this Pop-Up occasion to create a stronger emotional bond. Engaging our key customers at moments of significance with an instant gratification solution shows them that we understand, anticipate, and provide for their needs better than anyone else. More importantly, it shows them that we appreciate the connection between their lives and what we want to sell them.

How Shopper Community Connections Pop-Up works:

  1. Identify key shopper groups.
    • Shopper segments could be based on shared interest (e.g. bicycling, music, boating)
    • They could also be based on life stage (e.g. college students, new parents)
    • Other key shopper segments might include generations, values, socio-economic status
  2. Identify occasions or locations where a large group of these shoppers are most likely to be gathered together for a particular desire or need.
    • Orientation week for college students
    • Concerts or music festivals
    • Urban or suburban centers
    • Community events
  3. Provide the perfect instant gratification solution that best suited to their needs/desires and our economics and capabilities.
    • At-Hand Solutions: larger scale executions that might include a storefront
    • Self-Contained Mobile Retail Solutions: might include dedicated vehicles or adaptable containers and other moveable solutions
    • Pop-Up-in-a-Box Solutions: multi-location, self-contained, targeted, self-standing units designed so that a single store/brand employee can transport, set up, and operate. This solution makes it possible for simultaneous, large-scale implementation of meaningful Pop-Up in many locations.

Whether you use one or all of these Pop-Up 1.0 evolutions, the key is to recognize the value of strategy and the thoughtful, targeted use of Pop-Up retail to address a range of problems and expand opportunities in retail.

 

Seven Ways to Successfully Launch a Pop-up Shop

While digital media, social networking platforms, and a multitude of communication gadgets have been cited as major contributors to the shifting retail landscape, these challenges are not met without new strategies and tactics to help navigate the daunting retail market. The overarching goals to increase brand recognition and personal connections with customers have remained the same, but an increasing number of retailers have recognized the “instant gratification” nature of the consumer as the impetus toward temporary retail outlets. More commonly referred to as pop-up shops, this retail platform will likely be one of the most important elements of a successful retail marketing campaign in the years ahead.

Taking your products to your customer, as an online or bricks-and-mortar outfit, will give you a chance to build loyalties with customers before the competition does, and with so much commercial real estate space sitting vacant – 10.1% according to published reports – this should be a fairly simple process. However, finding landlords with space for lease to temporarily house your company’s wares can be just the beginning of a hectic process, so keep the following tips in mind:

  1. Start early: By planning several months out, you can increase the effectiveness of your pop-up shop and save considerable time and money. Make sure you create a budget and identify your objectives as early as possible.
  2. Research the location: Finding the right neighborhood or store location is critical to ensuring the success of a pop-up shop. This includes doing due diligence on area demographics, other retailers present in the neighborhood, visibility, foot and vehicle traffic counts, and neighborhood safety. Speak to neighboring stores for the real scoop.
  3. Consider lease duration: How long a retailer should keep a pop-up store open depends on the business objectives and budget. Most pop-up stores are open for about three months. Make sure that you give yourself enough time to see results – at least three to four weeks.
  4. Brand the space: Knowing how you want to set up your store – what products and how much of them you will be displaying, as well as lighting, decor, and theme – is critical in creating an atmosphere that speaks to your brand identity and will leave a lasting impression on consumers long after the store is closed.
  5. Know your landlord: Has your landlord ever done a temporary lease arrangement before? How accessible are they? Are they willing to work with you to improve the space? These are key questions that need to be asked during lease negotiations, and will weigh heavily in ensuring the success of your pop-up store.
  6. Educate and train: A pop-up store is an excellent way to educate your customers on all that is great about your products. Make sure your sales staff is educated and trained on the unique selling points of your wares, and that they have a clear understanding of how you want them to articulate these points to customers.
  7. Follow up: Once you close your store, the benefits of having opened a pop-up shop can still be reaped. Retailers should take down email addresses of customers who visited the store and conduct follow-up outreach, either through emails or social media platforms, to keep the customers engaged and solicit feedback.

Jennifer Davis / DDI

Inspiration, Pop Up Stores, Retail, Retail Intelegence
| Tags: , , ,