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The peaks and pitfalls of retail pop-ups

The peaks and pitfalls of retail pop-ups

By Expert Panel 27.01.2016

Pop-up stores are the new kid on the block as mobile short-term retail outlets have only been around in the US and UK since the 1990s.

Yet pop-ups draw on long retail traditions of “here today, gone tomorrow” - think of circuses and fairs of old. Just as the fair came to town in the warmer seasons, summer is the perfect season for pop-ups when consumers are relaxed, open and looking to be entertained.

Pop-ups gain attention for brands or wares, create demand and an element of “cool”, and are an effective tool for market research and product testing. For retailers like In-N-Out Burgers, it can be a great way to “put the toe in the water” and test demand before fully committing to roll out plans for larger stores or before launching new product ranges.

Retailers have to strike a balance between finding cheap, short term rental for a pop-up, with finding locations where the target audience shop, work and play. Busy streets aren’t always the best option because unexpected locations can be the most effective.

Responding to marketing overload

As a disruptive retail marketing tactic, pop-up outlets strike the imagination and engage consumers in mature and crowded markets.

As modern consumers living in consumption-driven societies, we have adapted to being bombarded with marketing by developing mechanisms to shutout all this marketing noise - and simply maintain our sanity. But this makes it increasingly difficult for marketers to reach their target audiences.

Pop-ups cut through these thresholds and consumer routines – surprising us in unexpected spaces and breaking the standard retail mould. The Ikea ‘party train’ in Tokyo launched for two days only to build awareness of a new store opening - is one of the best examples of this strategy.

While pop-ups appeal to our sense of fun and desire for new and novel consumption experiences, they also tap into to consumers’ FoMO - Fear of Missing Out. Limitations - such as time (here today, gone tomorrow) and supply - are fundamental to the pop-up retail marketing concept. For example, the six month tenure of Heston Blumenthal’s Fat Duck Melbourne pop-up limited the window of opportunity to experience this unique culinary experience.

Viral social media campaigns go hand-in-hand with pop-up stores; harnessing the power of digital word-of-mouth to heighten consumers’ sense of urgency.

Pop-ups are also a great marketing tool to build awareness of a new brand or retail concept before it enterings the market – Japanese retailer Uniqlo introduced the Melbourne audience to its concept and clothing range through a small pop-up before opening the large store in the Emporium.

For retailers like Uniqlo, opening a pop-up enables them to rapidly understand the demands and trends in a new market and to tweak their product ranges for the main store accordingly.

Pop-ups open up new opportunities to interact with the consumer in surprising locations usually out of reach to the retailer marketer – pop-ups can go where no other store has gone before to tap into and disrupt consumer habits in that space – such as the H&M pop-up store on the beach in the Netherlands and Miami.

The pitfalls

One of the dangers of pop-ups, however, is that by definition they are supposed to ‘pop-up’ for a limited time and then disappear. Holding on to a pop-up for too long in one space – even if the pop-up is generating significant profit – can result in the concept losing its disruptive nature and sinking back beneath consumers’ awareness. Similarly, to engage and be embraced by consumers, the pop-up concept must break the mould from the outset or risk getting lost in the marketing clutter, going unnoticed with barely a ripple.

In addition, when devising and launching a pop-up, having a specific target audience in mind is a must – to target where they live, work, shop and play and the levers to titillate them out of their daily habits.

“Location, location, location” is a fundamental driver of retail success, and pop-up stores and concepts are no exception to this rule.The Conversation

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Michal Carrington, Lecturer in Marketing, University of Melbourne

This article was originally published on The Conversation.


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