Pop-Up Shops as a Marketing Tool for Retailers

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Pop-Up Shops are short-term, temporary retail events that are “here today, gone tomorrow”. It is the temporary use of physical space to create a long term, lasting impression with potential customers. “The pop-up retail phenomenon, once known as flash retailing, has grown in recent years” say experts at Gordon James Realty, a local property management firm. Retail space for pop-up shops is rented for a fraction of the cost of a long-term space and is a cost-efficient way for a retailer to increase its brand awareness and make a profit.

Pop-ups are changing how commercial property owners are leasing their spaces; how big brands are launching new products and how online retailers are marketing the merchandise they sell online 1. Inquisitive customers enjoy pop-ups because there they can learn more about product they are buying – e.g. where, how and by whom the products were made. Online customers can enjoy the shopping experience by visiting Pop-Up shops of online retailers. It offers a physical space to touch, smell and try-out products that they’d searched online.

What are Pop-Up shops?

My first memory of a Pop-up shop was as a little boy at a school bazaar. The local fish-and-chips fast-food retailer has setup a stall, with the necessary fryers and other equipment from his store at the school. The sounds and smells that were coming from his pop-up stall will always stay with me. However, more formally:  A distinguishing feature of pop-up retail is its temporary nature, intentionally springing up, and disappearing quickly 2. Consequently Pop-up shops can further be described as follow:

  • The shops usually involve one retailer rather than a group of retailers, and are usually found in trade shows. The latest trend however, is that they are setup in unused open spaces, storefronts, or within existing stores.
  • They are a way for promoting selected products or brands in a temporary location and on a smaller scale than trade shows;
  • Pop-up shops may be open in only one location, and are designed to be open a few days to a year;
  • Customers are allowed to have unique, personalized interactions and experiences with brands at the shops; and
  • Pop-up shops employ brand representatives who have a lot of knowledge about the brand.

The benefits of Pop-up shops are according to Sriram Subramanian writing in ShoppinPal:

  • Low overhead costs – retailers can take advantage of prime retail space at the fraction of what it normally cost;
  • Lower risk – short term monthly leases, low initial expenses and flexibility in operations reduce the risk for retailers;
  • Higher brand awareness – people are interested in the sudden appearance of a store, especially if it offers something different;
  • Increase sales – by taking your store where your customers are and making it more convenient from them buying from you;
  • Extended reach for established retailers – reach into different locations and new market niches without having to establish new stores in those locations.

Let’s take a look how retailers may use pop-up shops strategically to their advantage.

 Bricks and Mortar retailers use Pop-Up Shops to stay competitive

The battle for Brick and Mortar retailers to survive against the virtual onslaught of their online counterparts has been discussed many times by this author (e.g. “Crossing the digital threshold – adding Clicks to Bricks for sustainable retail outcomes“). Hence some Bricks and Mortar retailers had to resort to Artificial Intelligence and using the Internet of Things to integrate digital technology to the physical stores.  However, resolute Bricks and Mortar retailers have found another innovative way to enhance the shopping experience of dwindling customers.

Pop-up shops that are strategically placed on shopping floors are appreciated by customers because of the positive hedonistic aspects thereof 2. Here they enjoy the excitement of the experience and the exposure to new, unique products. The Pop-up shop offers an interactive environment where the customers may communicate with knowledgeable brand representatives to gather information and share their perspectives.

A pop-up shop placed inside the retailer’s store can be used as a hub where customers can get more technical information about products and services. It gives them the opportunity to buy the retailer’s products online while they are in her shop.

Online Retailers use Pop-Up shops to let their customers feel, smell and taste their products

One of the big drawbacks that online retailers have is that their customers can’t feel, smell or taste their products online.  However, pop-up shops may help online retailers to bring their customers in touch with their products. Pop-up shops are ‘mobile’ and can relative easily be assembled in places where customer traffic is high.  They can be erected in shopping malls, at trade fairs etc.  Further, online retailers that sell niche products may choose to setup the pop-up shop close to their target customers.

The big online retailer Amazon.com has started to launch pop-up shops in multiple locations across the USA, according to Eugene Kim of the Business Insider. The pop-up shops reflect the company’s growing drive to reach consumers directly . Amazon.com does it through a variety of access points including retail storefronts, home delivery, and innovative devices.

Amazon’s Pop-up Shop

Concluding

Although pop-up shops are not new to retail, they are nowadays used more strategically as a marketing tool. Therefore retailers should ask themselves what they want to achieve with pop-up shops. Are the additional costs and benefits worth the effort? Also, the roll-out of pop-up shops need to be preceded with a focused marketing strategy. Therefore, tell the people in the vicinity of your planned pop-up shop about it . They need to know what they can find there, and what the benefits are for them.

Finally, the rise of pop-up shops can partly be ascribed to the ongoing digital disruption taking place in the retail marketplace.

Read also: Adding Bricks to Clicks – How to Choose a Site for your Physical Store

Notes

1 Baras, J. 2015. Popup Republic: How to Start Your Own Successful Pop-up Space, Shop, or Restaurant. John Wiley & Sons.

2 Kim, H., Fiore, A.M., Niehm, L.S. and Jeong, M. 2010. Psychographic characteristics affecting behavioral intentions towards pop-up retail. International Journal of Retail & Distribution Management, 38(2):133-154.

Images

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Published by

Douw G Steyn

Douw G Steyn

Management consultant, blog writer, dreamer

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