By Roxane Voidonikolas
Introduction
As a small business owner, finding new and innovative ways to get your products into the hands of customers is exciting but also challenging. A pop-up shop is an effective strategy for real engagement with potential and existing customers, which simultaneously boosts sales.
Pop-up shops allow your customers to interact directly with your products and brand, creating a connection that online platforms cannot replicate.
A pop-up shop is not just a selling space, but a creative and engaging way to tell your brand story, allowing your customers to physically immerse themselves in your brand’s world.
So, whether you are an experienced seller or a budding entrepreneur, use this comprehensive guide to help you succeed in your next pop-up shop.
Read on to learn about: What is a pop-up shop? What are the benefits of a pop-up shop? Types of pop-up shops. How much does it cost to open a pop-up shop? How to set up a pop-up shop in 4 easy steps. Questions to ask before booking a pop-up shop space. Examples of pop-up shops. Marketing tips to make your pop-up shop successful. How to evaluate the success of your pop-up shop.
What is a pop-up shop?
A pop-up shop is an ideal opportunity for emerging digital brands to test a temporary retail space. Also known as “flash retailing,” it allows you to meet your existing customers where they live and place your brand in front of new shoppers.
Pop-up shops are also a straightforward way to encourage sales without spending more money on customer acquisition online. While pop-up shops may resemble regular stores, many brands use them to create a unique and engaging physical shopping experience.
If you’re interested in testing a business presence for your brand but hesitate due to financial risks and store commitments, a pop-up shop could be the right solution for you.
Quick Start Guide to Pop-Up Shops
Considering hosting a pop-up shop? This free guide includes 3 lists to help you determine what you want to achieve with your pop-up, the different types of pop-up shops, and design ideas to help you get started.
Get your free guide
Almost there: Please enter your email address below for instant access.
Email Address
We will also send you updates about new educational guides and success stories from Shopify’s newsletter. We hate spam and promise to keep your email address confidential. Thank you for downloading. You will receive your free download shortly. In the meantime, start building your shop with a free 3-day trial from Shopify.
Get started now
What are the benefits of a pop-up shop?
Creating a personal connection with customers
While technology makes purchasing more affordable and convenient, there is no substitute for face-to-face service and personal shopping experiences. A physical store allows you to connect with customers on a human level and build a network of loyal and engaged customers.
Building buzz and awareness
Scarcity is a proven tactic that drives customers to act through their desire to purchase exclusive or limited-quantity products. A temporary pop-up shop with an expiration date encourages customers to visit before they miss the opportunity.
This strategy works especially well when promoting new products or product lines, launching major campaigns, or simply seeking to increase general brand awareness.
Balancing customer acquisition costs
The pandemic forced retailers and their marketing dollars to move online, increasing the cost of acquiring customers through paid search and social media. However, as e-commerce flourished, the gap between digital acquisition costs and rental costs has narrowed.
It forced
Consumer vacancy levels are declining as commercial rents drop to record lows – 37.5% lower than they were in 2019 in places like Soho in New York City, according to CBRE. To address vacancies, store owners have relaxed lease terms and have eagerly sought to find temporary tenants just to keep their stores active. According to Reuters, in New York City, the residential real estate market has rebounded, but commercial rents remain lower than pre-pandemic levels.
There is still an opportunity to test the retail waters and diversify your marketing to include foot traffic alongside web traffic in a low-risk, lower-cost environment.
“Soon, actual impressions will be more expensive and of higher quality than digital impressions,” says Ben Sidell, founder of Neyborly, a platform that matches brands with commercial spaces.
Testing the market for a permanent physical location
Pop-up stores require minimal upfront investment, making them a great testing ground. A successful pop-up shop can be a good indicator that your business is a candidate for expansion into physical retail. If your shop isn’t performing as well as you hoped, you may need to regroup and find a new way to test your expansion plans. (We’ll look at some intelligence metrics later).
Warby Parker, the eyewear brand, is a once-digital brand that tested physical retail beginnings through pop-up shops. Its experience was so successful that the company has opened numerous stores and now has nearly 90 retail locations.
Boosting sales during peak times
Black Friday, Cyber Monday, and any other peak sales periods are excellent times to open a pop-up shop. A pop-up shop can drive customers to linger after store closing and the holiday season ends, turning seasonal shoppers into lifelong customers. If you regularly host seasonal pop-up shops, you will build a sense of anticipation among your most loyal customers.
The annual Christmas market in Denver is just one example of a seasonal pop-up shop. Locals and tourists alike mark its date every year.
Testing new markets and gaining momentum in current markets
One of the most important things new businesses should do is check the demand for their products, and actual product validation happens when money changes hands.
Whether you want to test new goods or pricing or product bundles, a pop-up shop is one way to validate customer demand before investing in larger quantities. If you have an idea for a new product line or product collection, for example, start with just one or two products to see if they have appeal.
And selling in person means gaining the added benefit of receiving direct, unfiltered feedback from customers by observing their initial reactions and seeing if they are willing to spend money on what you are selling (and how much).
Clearing out old inventory
Holding onto old inventory is more costly than you might think. Not only do you miss out on sales, but you also pay carrying costs and tie up money that could be invested elsewhere in your business. Additionally, this inventory can become obsolete and unsellable after some time, resulting in lost revenue and capital.
Pop-up shops are a great way to give a fresh push to old inventory – especially seasonal items with a short shelf life – by utilizing special offers like buy one get one free or bundling items together.
Types
Pop-Up Shops
Permanent Pop-Up Shops
Sometimes, pop-up shops work so well that they become permanent stores. Permanent pop-up shops are produced from temporary or experimental pop-up shops that generate enough foot traffic and sales to justify the long-term cost.
Storefront operates as a leading online marketplace for short-term retail space rentals.
Storefront also runs a program called “From Pop-Up to Permanent” that assists merchants in identifying locations for pop-up shops to test temporary selling spaces and discover if physical retail is the right fit for them.
Some brands, such as Chicago Makers, choose semi-permanent pop-up shops. Brand owners Anna Romo and Monica Little launched their first pop-up store during the holiday season in 2020. At the start of 2021, they began a semi-permanent location in the Pucktown neighborhood of Chicago.
Moving to a permanent or semi-permanent model can also be a result of vendor demand. “Our recent expansion has been driven by the ongoing interest from local artisans and creators looking to sell their products,” according to Anna Romo, co-founder of Chicago Makers.
Pop-Up Shops as Marketing Events
Brands often use pop-up shops as marketing events to generate buzz around a new product launch, a rebranding campaign, or a company announcement.
According to Event MB blog, “There’s a marketing aspect to all events, but few events have a unique setting to amplify word-of-mouth marketing.”
Similar to how you would create a marketing plan for your pop-up shop, a pop-up shop can also be a marketing strategy for your overall business. Launching a pop-up shop is as much a marketing strategy as it is a retail strategy.
Seasonal Pop-Up Shops
Seasonal pop-up shops utilize seasonal characteristics to drive traffic and sales. A seasonal pop-up shop during the holidays is the most common. These shops take advantage of the peak shopping season, which represents a third of annual revenue for some businesses.
Chriskindlmarket in Chicago is an example of a seasonal pop-up shop. Running from mid-November to the end of each year, Chriskindlmarket offers consumers an interactive holiday event featuring handmade goods from various vendors to purchase as gifts.
Experimental Pop-Up Shops
Launching pop-up shops is one of the main reasons brands open pop-up shops to test with new products, new markets, or new selling experiences or retail experiences.
Experimental pop-up shops typically offer something slightly different from the main business offering so that the business can gather valuable data on customer feedback and interaction.
If you are considering expanding your online business into physical stores, launching a new product line, or targeting a new market, a pop-up shop may be the best way to run your experiment.
Virtual Pop-Up Shops
Virtual pop-up shops offer your customers a chance to browse your products in a digital store. It allows your customers to virtually walk around your store and browse your products, similar to how they would interact with your brand in person.
Unlike a traditional e-commerce site, virtual pop-up shops provide a 360-degree interactive shopping experience.
Sub-Pop-Up Shops
A sub-pop-up shop is a store set up inside an established store. Typically, vendors rent a portion of a store or a small space within a larger store to sell their products. Launching a sub-pop-up shop markets your business to traffic in the larger store and helps you save money on rent and decor.
They have
Youth fashion brand Plant Man P has launched a pop-up shop for its products at a location in New York for The Sill.
John Perdomo, founder of Plant Man P, said: “We decided to design a shirt with the phrase ‘Plant care is self-care’ featuring an infinity symbol design, because we believe that plant care is self-care, and vice versa.”
Perdomo added: “We love being able to get out and meet people in the community and help them in any way we can, whether it’s plant care, self-care, or anything in between.”
How much does it cost to open a pop-up shop?
Popertee, a retail analytics company, estimated the cost of a 30-day pop-up shop at €29,085 (about $32,000), while Inkbox, a temporary tattoo company, estimated the cost of a two-week pop-up shop in 2016 at around $15,000, plus $3,000 for furniture that could be used for other purposes.
Unfortunately, there is no clear answer to the cost of a pop-up shop. Location, duration, and size are some factors that can dictate the cost.
Source: https://www.shopify.com/guides/ultimate-guide-to-pop-up-shops
Leave a Reply