A Pop-Up shop is a temporary presence for retailers, small businesses, and local communities. Pop-Ups come in various formats and sizes, from small standalone kiosks to more traditional stores. The temporary nature of a Pop-Up provides added value to different stakeholders including the local community, landlords, customers, and the business owners and employees.
To summarize: Pop-Up retailing can be defined in terms of an experientially orientated consumer–brand interaction, taking place within a particular, albeit temporary, “territory” (Warnaby, 2015).
Pop-Up Objectives
Pop-Up shops have different, but not mutually exclusive, objectives. There are four basic objectives centered around the retailer, with a fifth that goes beyond:
Increasing brand awareness, brand identity, and/or brand stickiness all fall into the communicational category of pop-up objectives. An important step in the validation of new products and marketing campaigns is gauging the demand that they generate. Using a pop-up can help a retailer quickly adapt to demand and tailor their product(s) to maximize their future sales potential.
To immerse the customer in your brand using a unique atmosphere can help facilitate a more impactful effect, and translate that into more sales, more brand stickiness, and word-of-mouth or referrals. The experiential aspects of a pop-up store can better differentiate a retailer from its competitors, and value proposition. Additionally, the experience, if tailored to the local clientele, can help improve customer perceptions about your brand, increase turnover rates and therefore sales per visitor ratios.
To help maximize potential sales, market share, and market penetration, pop-up shops can be used as a strategic advantage for both established and new retailers. Pop-Up shops can also help a retailer take advantage of temporary advantages in their supply chain to maximize profit potentials: for example, seasonal pop-ups can help manufacturers and distributors of Christmas / Halloween / Valentine’s Day products better reach a larger market than if they were to solely use their traditional retailers. The lower overhead costs of running a pop-up also help the retailer provide better value to the customer than traditional stores, which also helps manufacturers and distributors who have maximized their reach in traditional markets.
Gaining market intelligence is a vital component to staying competitive in the dynamic world of retailing. Pop-Ups can provide low risk methods of testing new markets, products, and services without requiring a retailer to cannibalize existing retail space, alienating existing customers, and engaging in expensive marketing campaigns. You can use a pop-up to test a new concept in retail, new product combinations, new recipes or a new restaurant, or whether your new business will gain enough traction to warrant investing in a permanent location. Combining these benefits, new retailers can use the pop-up format to gauge the validity and demand of their value proposition, while keeping costs low, which gives them the freedom and flexibility to make necessary adjustment that best suit a particular market’s unique demands.
Pop-Ups can further economic, and thus, community development by filling previously empty, and potentially unsightly, spaces with new, novel, and value-added retail space. Pop-Ups increase foot traffic, awareness of other businesses in the immediate area, and total spending.
Pop-Up Formats
Pop-Up shops have existed in one format or another since ancient times in which little standalone stores sold wares and various foods to locals and travelers (Holleran, 2012). Dating back to ancient Egypt, pop-ups would follow armies as they travelled to their next battle, providing the soldiers with food, weapons, and offering various services such as repairs to wagons and chariots (Spalinger, 2008). Modern pop-up shops come in an ever-growing list of formats including:
In which a landlord and a retailer benefit mutually by renting a vacant space for a limited time, rather than leaving it empty. Additionally, a previously vacant space that is occupied adds value to the community in which it resides by attracting more foot traffic and improving the visibility of the neighborhood.
Dating back to at least the ancient Romans, these pop-ups follow events such as festivals, concerts, and even holidays such as Christmas and Halloween to better reach more potential customers. These types of pop-ups offer an opportunity to retail highly specialized wares and foods such as Halloween costumes that would otherwise be more difficult to sell.
Whether they are in a van, truck, shipping container, or custom-made store, these pop-ups offer the retailer a unique opportunity to follow customers and demand. These types of pop-ups are highly flexible, mobile, and best suited for markets that have short-term demand spikes.
Pop-Up shops are not limited to physical locations, and often reside in the online marketplace. This significantly cuts overhead costs for the retailer, while giving them the ability to reach a far broader audience geographically. Moreover, these online pop-ups can quickly change their inventory selection and site design to better suit demand which itself is fluid. Online pop-ups are also a great format for testing new products (also known as validation) before they are sold in mainstream stores, and therefore can be operated by larger retailers and manufacturers.
Although less common, building a temporary outdoor pop-up shop is a refreshing strategy to increase awareness of a brand, product, or new venture. Previously empty spaces can quickly be transformed into magnets for new traffic and potential customers when a new building is erected.
A larger retailer can dedicate a space within their brick and mortar location to a pop-up shop. This is an example of coopetition in which two retailer that may have otherwise competed against one another, now create new value by working together, sharing resources, and increasing awareness of their wares. The larger retailer may see an increase in overall sales per square foot, more foot traffic, and additional complimentary sales, while the smaller retailer can save significant overhead costs, utilize existing foot traffic, and advertising to showcase their merchandise to more people.
These pop-ups are most often found in the walkways of shopping malls. Their locations are strategically chosen to maximize visibility and minimize overhead costs, while providing additional revenues for mall owners.
A new type of pop-up facilitated by decreasing technology costs, the virtual wall uses digital screens to showcase products. Customers can browse static or dynamic product ranges and images, read descriptions and reviews before using technology such as QR codes to scan and purchase products. Purchased products are then shipped to the customer from a central location. This format is highly mobile, cuts overhead costs, and an excellent opportunity to gauge market interest in products.
One of the more traditional pop-up formats, vending machines have established themselves in the modern world because of their compact size, highly visible graphics, and extremely variable product ranges that they can provide. Low overhead and maintenance costs make these types of pop-ups very desirable for purveyors of smaller merchandise.
An augmented reality format, these types of pop-ups require a potential customer to use their smart devices’ cameras to ‘unlock’ or ‘reveal’ the store itself. What seems to be graphics on a brick wall can actually reveal a whole store that resides in the online digital world. The products offered can be tailored to the market and location in which the virtual store is hidden. This format requires user interaction to start the sales process, and has the potential to better grab the attention of tech-savvy customers that look for new and exciting ways to shop.
: When two or more retailers, selling complimentary products work together, they share the costs, risks, and rewards of a pop-up shop. A clothing retailer can partner with an accessories retailer to offer a better range of complimentary merchandise that would have otherwise required the customer to visit two different stores. These pop-ups can improve units per transactions for retailers and help customers see each retailers’ wares in a new light.
