Nov 6, 201912 min read

Show Up, Pop-Up and Get Physical. How to Succeed with Your Pop-Up Store.

Simon Falk headshot

by Simon Falk

While retailers are focusing ever more resources on the online sphere, there is somewhat of a counterculture popping up (pun intended). The buzz word is “pop-up store” and more than a counterculture it is a re-invention of the physical retail space.

For the uninitiated, a pop-up is a temporary storefront run by an online merchant. Sounds counterintuitive right? It’s far from it. The keywords here are temporary and online. It’s a shop showing up seemingly out of nowhere in a previously vacant lot with the objective of either introducing new flagship products, spreading brand awareness, clearing out their online stock, or in some cases even hosting a firesale where everything must go. Since it’s an online store hosting the event, it brings that uniqueness to it, allowing the customers to visit their favorite online brands IRL for the first time, and creating an entirely new dimension to their relationship with the business.

Whether or not you’re behind the idea, one thing is clear: what seemed a passing trend is now an established business strategy. Major brands such as Nike, Macys and GAP are going all in and pop-up stores are currently a $10 billion industry. The conclusion here is that the concept is working and it’s a great opportunity and channel to take advantage off in boosting your business.

Why even consider a pop-up?

1. Marketing

Running a pop-up is not just a selling touchpoint but, more importantly, an alternative to pushing ads on Facebook and Instagram which can become costly. Every person walking by your pop-up store will have seen it and everyone visiting will now have actively engaged with your brand. Even if they won’t buy something there and then, they’ll become increasingly aware of your business and increasingly likely to shop with you in the future.

2. Branding

In your online store, customers can only interact with 1 of the 5 senses (or 6 if you ask Bruce Willis). Allowing them to touch, hear and sometimes even smell or taste your brand makes all the difference in creating awareness of your business and establishing a reality to your products and services before they buy. If customers can’t see you IRL, do you really exist? Get creative in the design and experience of your pop-up you can really tap into all the senses to create a lasting impression, boost awareness of your existence and introduce people to your business. This can also encourage free marketing as customers share your pop-up, products and business on social media.

3. FOMO. (Limited time + Limited supply = Demand = Volume = Profits)

With the temporary nature of the pop-up, it taps directly into the FOMO (Fear Of Missing Out) that is ingrained into our collective psyche. Whether you’re running a pop-up for hosting clearance / fire sales or launching it as a way to promote new, exclusive or limited edition flagship products; either way the demand and urgency of shopping is going to be higher than an online store where a consumer can go in whenever and place my purchase and track availability in real time. It is a “limited time offer” on steroids.

Trivia: When Pokemon Centre pop-up store opened earlier this year in Westfield Mall in London the FOMO became so intense it resulted in 5 hour queues persisting every day for a week.

4. Does what online can’t

These are the greatest motivations for people choosing to shop at a pop-up:

  • Unique services/products (39%)
  • Localized assortments (36%)
  • Optimal pricing (34%)
  • Convenience (33%)
  • A fun experience (30%)

Number 2 and 5 are very difficult to achieve in traditional e-commerce. Many of the top reasons why people prefer pop-ups (except Convenience) are hard to achieve in online retail.

Pointers and inspiration

1. Immersion and shareability

Visiting your pop-up doesn’t just need to be like visiting a store. Transform your newfound space into an event and make it an immersive and engaging customer experience. Make the most of interior design, and combine it with surprising and interactive elements in line with your brand. You could make an imaginative dream world, create a selfie board or landscapes with social media competitions (“post a pic on Instagram and win”) offer the crowds snacks or drinks customized for your brand and host event-in- event. Running a health or fitness store? Host a yoga session. Computer retailer? Have a video game competition. Toy store? Arts and crafts for the kids. You get the point.

The stronger impression you can make on your consumers the higher chances you have that customers will speak about your brand in social media, something that is the wet dream for any business. You might get 1000 visitors for your store but it could end up in 100,000 engagements online. Make every second count when it comes to brand awareness.

2. Co-branding

Are there other merchants that compliment your brand or already work with you that could be there to sponsor or even co-host the event? This often spells win-win.

You not only share the cost of the store but more importantly the target and customer groups of your collaborators; giving you access to new customers that may not otherwise have picked up on your brand. It may go without saying but, of course, you shouldn’t pick collaborators that are in competition with you in any way and make sure to go for partners who can bring something in terms of clout, customer and target groups, brand strength and highly related product categories.

3. Location, location, location

It might seem obvious but it’s something many regular stores miss when choosing location is to ensure that there is a reasonable flow of people moving past the store. Most visitors are probably not going to be aware of your store in before hand and it doesn’t matter how sexy of a storefront you have. You will likely have to rely on walk-ins.

That said, it doesn’t have to be on the poshest (and most expensive) of addresses in New York, Paris or Milan. You can get creative here and choose a less expensive but equally trafficked location in your own city such as outlets, gentrified industrial area and smaller malls. This is especially important if you’re a smaller up and coming retailer.

Creative ideas of locations:

  • Vacant space in malls or other commercial storefronts
  • Buses or other vehicles touring through various target or test markets
  • Farmer’s markets
  • Charity events
  • Music and arts festivals and concerts
  • Sporting events, races, and fitness expos
  • Recycled shipping containers (a practical and lockable pop-up)
  • Store-in-a-store (either in your own existing store or in co-branding)
  • Kiosk deployments for holidays or special events

4. Go to the streets

Be a promoter. Yeah, like those cheesy tourist bars do to get people into their place. The sexiest and most inviting storefront isn’t going to get you all the way. Deploy guerilla marketing teams on the streets and hand out something intriguing; make people stop, think and consider dropping by your store.

5. Cut waiting times and think about how you handle payments

If you succeed with your store – and especially with location – you’ll get heaps of customers at the same time. Whilst this is the goal of the pop-up, you’ll want to make sure you have the capacity to process those purchases at a steady rate to curb the risk of losing sales – in other words, 58% of customers state that they’ll take their business elsewhere if forced to wait in line for more than 5 minutes so keep it snappy!

As the store is temporary, you may want to reconsider the traditional checkout systems that can be a hassle to transport and install. There are suppliers out there – Klarna included – that allow you to process payments on a tablet or phone. They’ll allow you to process several customers quickly which can effectively cut the queues. It’s also more cost efficient and takes less time than setting up a traditional bulky checkout machine. The cherry on top is that they also offer alternatives to card such as installments and financing boosting sales.

6. Consider the timespan

If there’s one thing you should keep definitive with your pop-up is that it should be open for a set period of time, and that you should stick to that timeplan. If your location and setups warrant a higher budget you might want to stretch it ,but it all depends on the number of transactions you expect to pull (if it’s a fire sale or clearance it can be very short, but a blanket brand awareness campaign can last for longer). The usual timespan of a pop-up ranges from as little as 24 hours to as long as 6 months.

For example, fashion retailer J.Crew launched a pop-up store in New York that only lasted 24 hours to only sell merchandise from three brands, Public School, Juan Carlos Obando and Marc Alary (finalists of The Council of Fashion Designers of America/Vogue Fashion Fund). This scores high on the exclusiveness and FOMO scale. To promote the event, J.Crew launched an online presale of the brands displayed for a few weeks prior to the opening, with some of the pieces nearly selling out.

Can small retailers profit? Is it expensive?

Running a pop-up doesn’t have to be expensive. Research varies but pop-up stores can can cost anywhere between 50-80% less less to open and operate than brick-and-mortar stores and if you’re creative and street smart with your store, location and co-branding you can get away easy.

As with any initiative, make sure to evaluate the upside of starting one for your business beforehand, calculate the cost and forecast your budget.

Here a just a few ways you can cut costs:

  • Use Instore and app solutions such as Klarna. This way you can complete purchases on a phone or tablet, getting rid of the need of an expensive cash registry and allows you to process installments and financing which can boost sales
  • Bring friends and family on board for promotion and event staff
  • DIY on design, interior design and consumables elements to the greatest extent possible
  • Choose an unlikely yet attractive location for a lower rent – keep an eye on that footfall though!
  • Use your network in any and all ways possible. Do you have acquaintances (business or otherwise) who can help out for a low rate or pro bono?
  • Focus extra on localized assortments and local marketing if possible. You’ll most likely know your local market and city better than a more centralized enterprise retailer, this can give you an edge

More inspiration

Klarna has set up several pop-up stores in the past year that incorporate many of the points above. The latest was hosted in Manchester, UK and included collaborations with highly recognizable brands such as ASOS, Topshop, Samsung, House of Holland and Beauty Bay.

The pop-up itself was creatively designed in line with brand and in order to create an immersive experience, packed full of Instagram opportunities for visitors. In order to connect with as many visitors as possible, we created buzz via a range of promotional activities across the city along combined with daily events such as yoga classes, styling sessions, beauty treatments, Klarna Krazy golf, live bands, DJs and inspirational talks. Check it out below!

Read more about Klarna’s Instore solution, enabling your business with modern financing options wherever you get in direct contact with your customers. When they’re ready to buy, more ways to pay will lead to more completed purchases and you won’t have to bother with clunky checkout machines to get that “ka-ching”.

Don’t be a stranger!