Photo by Mike Petrucci on Unsplash
September 4, 2024
Should More Retailers Be Opening Pop-Up Shops?
Pop-up shops are temporary retail spaces that have been invaluable to e-commerce and mobile brands that do not have permanent physical store locations. However, more established brands are also using pop-up shops to their advantage.
Pop-ups allow brands without a permanent retail residence to bring their products to the public in person, while established retailers can use them to create experimental store designs, special events, and experiential models, as well as to test new markets. These temporary retail locations can also create brand awareness and push sales backed by fear of missing out (FOMO).
The most well-known and successful pop-up retailer in history is likely Spirit Halloween. CEO Steven Silverstein attributes Spirit’s success to its strategic inventory management and effective use of temporary locations. By offering an extensive selection of over 4,500 costumes and leveraging real estate that becomes available from defunct stores, Spirit Halloween has set itself apart from traditional retailers.
This model allows the company to quickly adapt to trends and manage excess inventory efficiently, maintaining its dominance in the Halloween market and driving significant foot traffic for landlords. The chain’s ability to secure prime retail spaces and manage inventory effectively underscores its strength as a pop-up retailer.
In another example from Storefront, Boohoo, the British fashion retailer, leveraged a pop-up store to not only boost brand visibility but also to conduct market research. Recognizing the competitive nature of the U.S. clothing market, the company utilized the pop-up to carve out its niche. The store featured a shoppable showroom where customers could try on outfits and share them on social media. The brand tracked the outfits customers tried on, and on the final day, shoppers “claimed the outfits that they tried, using the hashtag #theboohoostore.”
Additionally, in the UK, shops on High Streets have been struggling, “with footfall still well below pre-pandemic levels and many units lying empty,” and many believe pop-up shops are the answer that can help the retail area recover, according to the BBC. Although they might not be a permanent solution, some pop-up retailers could convert into permanent retail locations.
Though many pop-up shops are deployed to help smaller or e-commerce-only retailers experience a real physical retail location — without long, pricey leases that can prove to be risky — more established brands now also take advantage of the pop-up concept.
According to Retail Insight Network, global fashion powerhouse H&M is gearing up to debut a new pop-up store in Sweden. The store will showcase H&M’s fall 2024 collection, with a preview on Sept. 12 ahead of the official launch on Sept. 16. This initiative is “part of a broader strategy to differentiate the brand from its competitors,” according to the outlet.
Another major brand that has been using pop-up shops for years now is Nike. The sportswear retailer has a rich history of brand activations tied to major sporting events and cultural milestones, such as the 2016 NBA Finals featuring the Golden State Warriors. The company launched an eye-catching pop-up shop shaped like a giant Nike basketball shoe box with the latest basketball sneakers and official team gear inside. “The success was so great that these unmissable pop-up stores in a prime downtown location have become a core staple of Nike’s experiential marketing playbook,” according to GoDelta.
Popable, a tech company that helps brands find pop-up spaces, compiled a list of 12 brands that have grown their businesses with pop-up shops:
- Warby Parker
- Glossier
- Casper
- Away
- Allbirds
- Everlane
- Dyson
- Mejuri
- Birchbox
- Rent the Runway
- Baublebar
- Stitch Fix
Furthermore, the global fast-fashion retailer SHEIN has no physical stores but has opened up pop-up shops in the past, such as one in Santa Monica, California, earlier this year. Reuters also reported that SHEIN opened a pop-up in Johannesburg, South Africa, in August to expand its brand recognition within the country.
The list of brands and retailers, both small businesses and major companies alike, using pop-up shops is growing. However, there are still many major brands that have not yet experimented with pop-ups, possibly due to the notion that they wouldn’t benefit their brand or business strategy.
For some, short-term leases may not be attractive, especially to landlords that may prefer to have “long-term leases with credit tenants and use them to leverage other acquisitions.” Additionally, Jeffrey C. Paisner told WWD, “It takes a lot of capital to make a pop-up look like the expectations consumers have from knowing what a brand’s permanent stores look like. There’s not enough demand for pop-ups to reduce the vacancy rate.”
Discussion Questions
How are pop-up shops changing consumer expectations for established brands? What makes them successful in building lasting brand impact?
What should retailers consider when using pop-ups for innovation or marketing to ensure alignment with their business goals?
What future trends or challenges could impact the effectiveness of pop-up shops, and how might changing consumer preferences and technology play a role?
Poll
Loading …BrainTrust
Arnjah Dillard
North America Retail Practice Lead, Stibo Systems
Trevor Sumner
Head of AI and Innovation, Raydiant
Jenn McMillen
Chief Accelerant at Incendio & Forbes Contributing Writer
Recent Discussions
More Discussions
Will Shrinking Help Puma Re-Spark Brand Heat?
Puma is gearing up for a significant push to restructure operations. Will it be able to…Retail Tech’s Great Reset, or Baselining and Building Trust: Reflections From Groceryshop 2025
Groceryshop 2025 suggested a new baseline was being established. Is this the case?As Shopper Satisfaction Declines and Associates Show Frustration, How Can Retailers Fix ‘Blind Spots’?
Retailers are facing a decline in satisfaction from shoppers and rising frustrations from associates. What’s the…
Pop-up stores can be a profoundly useful strategy for brands and retailers looking to test new markets or offerings. And while landlords may be somewhat reticent to offer space on a temporary basis, I suspect that many others would be happy to oblige. The prospect of a more permanent arrangement should be compelling enough. Any retailer/brand contemplating a pop-up store should also make sure that they outfit these locations not only with product and staff, but also traffic counters so that they can measure visits and importantly conversion rates. Comparing the performance of the pop-ups to their other locations will provide meaningful insights that can not only help determine success of the pop-up store, but also inform future decisions and refinements.
Pop-up shops have their place, and they can be a great way of reaching consumers. However, not every retailer needs them. Some retailers have more than enough of their own stores or can connect with consumers in other ways. One thing I would say, however, is to determine the purpose of a pop-up. Is it to sell? To make money? To promote the brand? To reach new customers. Understanding the purpose helps guide the strategy and implementation.
Pop-up shops are a total win. Retailers get to experiment with merch & formats while gaining visibility, and distressed real estate brings in revenue for landlords. There’s a lot of empty boxes out there, so not only does it fill out vacant storefronts, but also presents newness to customers looking for a shopping experience.
I think this has a lot more to do with depressed real estate prices and desperate leasing agents than some inherent value in the concept; does this mean it has no value whatsoever? No: test sites can be useful; but it’s important to keep in mind why the space is availabe.
Pop up shops are not a profit generating strategy, but an opportunity for testing concepts, markets and new offerings. There needs to be much more rapid experimentation in retail, so yes, more popups, powered by better data and faster turn times to learnings.
Pop-up shops generate buzz and excitement by offering unique, limited-time experiences that draw in curious customers. These temporary retail spaces often feature exclusive products and special events, making them a hotspot for social media attention.
Pop-up shops, however, can be challenging due to short-term leases and rapid build-outs. It can be difficult and expensive to secure a prime location at short notice.
A tight timeframe can also present logistical challenges such as staffing, inventory management, and marketing. An important characteristic of pop-up shops is the sense of urgency they create, inducing immediate purchases and creating a lively shopping atmosphere. Db
indeed, Pop-up shops are redefining consumer expectations for established brands by introducing a new level of flexibility and creativity in how brands engage with their customers. One prime example is how the NFL Experience pop-up shops operate during the Super Bowl. When traditional real estate isn’t available, gutted buses serve as mobile storefronts, allowing the brand to seamlessly integrate into the event. This approach brings the experience directly to where the fans are, whether it’s at a park, school, concert, or major event.
For established brands, pop-up shops present the opportunity to become part of the event rather than simply being a vendor at it. When executed well, they are successful in building lasting brand impact by Creating Immersive Experiences: Like the NFL pop-ups, these shops give customers an interactive, memorable experience that goes beyond shopping. Brands can create exclusive, event-specific offerings that foster a deeper connection with attendees. Maximizing Foot Traffic in High-Engagement Spaces: By setting up shop in areas where consumers are already emotionally and physically engaged like concerts, festivals, or sports events, pop-ups can capture attention and drive sales in ways that traditional stores may not. Leveraging Mobility for Market Reach: Much like using a mobile bus or pop-up shop during the Super Bowl, brands can extend their presence to locations where permanent stores may not be feasible, capitalizing on temporary real estate or even parking lots to create a unique retail footprint.
When retailers consider using pop-ups for innovation or marketing, they should ensure alignment with their business goals by Choosing the Right Events: Brands need to target events that align with their values and where their target customers will be. The right setting can amplify the brand’s presence and make the pop-up feel integral to the overall experience. Balancing Creativity with Consistency: While it’s important to create a memorable pop-up, the experience should still reflect the brand’s core identity to maintain consumer trust and familiarity.
Looking to the future, evolving consumer preferences and technology will continue to impact the effectiveness of pop-ups. With consumers increasingly valuing unique, personalized experiences, pop-ups will need to leverage data, personalization, and interactive technologies to stand out. Technology that enables pop-ups to offer mobile payments, augmented reality experiences, and real-time personalization could enhance the connection between brand and customer, making pop-ups not just a trend but a core strategy for established brands.
Retail is about being in the right place, with the right product, at the right time. This applies even when the time variable is highly compressed. Pop-ups can serve several purposes. For some, it’s about brand presence to test a new market, test new products, or provide brand impressions around a complimentary event.
Pop-ups make sense for several reasons. As in the Spirit example, a seasonal business needing two or three months makes sense. Testing the area for interest helps retailers decide if the local consumers would support them. Testing new products with a special pop-up store could provide great data and feedback. Or maybe it’s just an effort to be more visible throughout a market, feeding customers into the larger store.
The reasons for the pop up are varied: testing a new concept, increasing brand awareness or introducing a brand to a new market. Increasing the number of locations during peak sales times will increase sales as long as the locations are not over-inventoried. Otherwise the profit can be erased with carrying or liquidation costs.The retailer offering the most seasonally or trend appropriate product at the right time, right place, right quantity and right price will reap the most benefits.
I love a good pop-up shop! Unfortunately, the only ones I see in suburbia are Christmas shops and Spirit Halloween stores. I have visit NYC to enjoy pop-ups.
Independent retailers do a good job with in-store pop-ups, partnering with suppliers, local brands, and designers. These shops aren’t huge but they are impressive.
Smart marketing + unique product = a fun and unexpected in-store experience.
Pop up shops can be a beneficial tool in assessing brand interest prior to making long-term real estate investments. They can also be valuable in supporting collaborations with other brands and creating demand for limited time products. I do question the ROI on leveraging pop-ups for retail sales. The operational cost of set-up, inventory delivery, onsite staff and breakdowns/returning products to the warehouse can be quite expensive. Retailers/brands should identify their business goals first and then define the proper initiatives to meet those goals. If pop-ups solve for those needs, then it is worth the investment.
I often fall back on the equation “Explore + Experiment + Execution = Experience³”. I wrote it through the perspective of the customer and their need/desire to explore and experiment in the shopping process. Well, brands and retailers need to Explore + Experiment also. Good old-fashioned market research, only executed to todays standards and expectations.
When I think of Pop-up shops my mind wanders to those horrible (in my opinion! 🙂 ) Halloween stores and then Christmas stores. The worst!
However, opening popup shops based around an event and you have a winner. You just need to get the brand and the event right….not to mention the location.
A lot of variables here that have to go right in order to be a success.
A resounding YES. Brands and retailers can provide one more “point of engagement” and not just another “point of sale.” Pop-ups also give the feel, touch, and smell, + social interaction that online shoppers can’t get. Pop-ups also create an “event” and urgent call to action if they are designed to offer something (product/experience) that the physical retail (b2B) and DTC touchpoints can’t
There are certainly many benefits to pop-up shops beyond immediate sales! One suggestion that comes to mind for those who are more hesitant in investing in a pop-up space and planning the space in a way that the elements are adaptable to future opportunities as well. That way the cost per use is lower, increasing the return on investment each time.
What exactly is the point of a pop-up? Is to get mention on some bloggers IG feed? More likely it’s to divert attention from a retailer’s core business that needs major fixing. Instead management is screwing around with low-ROI pop-ups instead of spending that time and money to improve its actual business. Unless it is testing a truly new concept or otherwise working on something it can’t do in its mainstream stores, it’s just a waste.
Pop-up shops create buzz and provide unique, limited-time experiences that keep customers engaged. To be successful, retailers need to align pop-up goals with their overall strategy, ensuring they offer something special that fits their brand image.
Future challenges include maintaining relevance as more brands use pop-ups and adapting to tech advancements that might change how people shop. Infact, challenges like high costs and the need for consistent quality can also affect the impact of pop-ups.
It’s all about evolving with trends and connecting with customers in meaningful ways.