Pop-up shops are evolving and taking on greater importance as brands lean into direct-to-consumer efforts and retail real estate firms see it as a robust driver of traffic. Pop-ups are also being used for experimentation as well as to connect brands and consumers in an authentic way.
Who’s hosting them and how?
It’s not just digital native brands penetrating new markets with pop-up spaces, although their advantage may lie in that they are “not burdened by the legacy of large retailers,” according to Chris Shaw, senior director of product marketing and analyst relations at Manhattan Associates. As digital natives may be more nimble and cognizant of data.
Enterprise retailers and digital natives alike boast temporary digs, soliciting the help of “pop-up architects” from The Lion’esque Group, brand experience agencies such as London-based Dalziel & Pow or investing their own resources into scoping online marketplaces.
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In the business of impermanence, leading marketplace competitors such as Storefront and Appear Here list available storefronts for short-term rentals numbering anywhere from a day to a month, depending on the space.
Touted as the “Airbnb of Retail” in media reports, Storefront has more than 10,000 pop-up venue listings in more than 30 cities worldwide, including New York, Los Angeles, London, Paris and Hong Kong as the major markets, including recent expansions into South Korea and Canada. Previous clients include Google and Nike, artist Rihanna and retailer Everlane, as reported in WWD.
Competitor Appear Here launched in 2012 online to connect brands, retailers, designers and entrepreneurs with available space seamlessly. Supreme, Loewe, Coca-Cola, Net-a-porter and Kanye West, as well as independents, have used Appear Here to book and host their events.
What’s new for experiential retail?
Speaking with Melissa Gonzalez, chief executive officer and founder of The Lion’esque Group, the “Glossier’s” of the world are essentially “converting their entire showroom into pop-ups.” Retailers are redesigning flagships to increase foot traffic and utilizing leases they already locked, while gaining real estate for independent designers within their own branded storefront. It’s the strategy used by both Bulletin and Tictail, a Swedish “DIY e-commerce platform” that opened their market in Lower East Side Manhattan.
Giving their global community a brick-and-mortar home, Tictail aims to bring the newest in fashion, art and home decor to Manhattan’s Lower East Side neighborhood. Designer spotlight pop-up shops are launched within the permanent brick-and-mortar store such as photography series “No Filter” by Jessica Walsh or a community yoga class.
Gonzalez informed that many clients crave that “aha moment” that is “not just an Instagram background.” The key to a successful pop-up is storytelling. Citing examples of Refinery 29’s 29Rooms and Museum of Ice Cream as those who offer “social proof” that customers desire.
What’s the value?
According to the “Halo Effect” report published by the International Council of Shopping Centers, 93 percent of shoppers purchased from retailers with a physical presence. Brands on average see an increase of 37 percent in web traffic when they open a brick-and-mortar store, (86 percent of the time for emerging brands, 78 percent of the time for established brands).
During New York Fashion Week, Rue Saint Paul, a new luxury lifestyle brand seeking to support independent and woman-owned labels while providing a sustainable, global fashion agenda saw pop-up shops as a means to foster “interaction, feedback and experimentation.”
Based in New York but lacking physical roots, the global vision is further bolstered by temporary pop-up experimentation beginning during New York Fashion Week. “As a brand that is looking to grow from e-commerce to brick-and-mortar, it is important that we are able to test out our retail strategy before making a significant investment in a permanent location of our own,” said Kelly Wang, founder of Rue Saint Paul. The brand utilized Storefront for its first pop-up shop.
Adding that NYFW and Art Basel serve as testing grounds with promised foot traffic, Stephanie Kidder, chief marketing officer at Storefront, added that: “Obviously, a pop-up is most appealing to a local demographic, but we have clients using pop-up to break into brand new markets or leverage a high foot traffic event such as Art Basel in Miami recently where we had a number of temporary activations or NYFW.”
Aside from breaking into new markets, Kidder offered that brands are using Storefront for advantages related to increased awareness, flexibility, cost and physical touch-points.
“More than 90 percent of all retail purchases are still done offline,” said Kidder, referencing a study by marketing firm SmarterHQ.
In order to thrive in today’s competitive retail environment, brands must rethink the customer experience and for many, that means burgeoning into temporary spaces.