This past November, Wired magazine pitched a pretend tent in a vacant storefront in New York's SoHo neighborhood to promote the latest in its advertisers' consumer electronics products to a wired crowd of fashionistas shopping in the trendy retail district.
Actor Robin Williams reportedly was one of the first in the store; singer Bjork soon followed. On any of the six weekends it was open, the holiday store drew 1,000 visitors. Weekdays were quieter, with an average of 300 shoppers.
Welcome to the world of pop-up shopping. As the line between retail and entertainment blurs, marketers and property owners are merging their creative talents to come up with temporary stores that connect with shoppers, create buzz for products and occupy otherwise unused space.
“Pop-up shops present something that has never been seen before, and then they're gone,” says Linda Berman, vice president of strategic brand development for Caruso Affiliated Holdings. The now-you-see-it, now-you-don't factor lends the operation an air of “inherent excitement,” she says.
Temporary stores aren't entirely new. Shopping center owners have specialty leasing departments that turn empty space into paying tenants for a few months or rent out kiosk space. What is new is the interactive, entertaining nature of the shops.
During the holiday season, for example, an American apparel store in New York held karaoke contests. High-definition TV provider Voom rented in-line space at General Growth Properties' Ridgedale Center in Minneapolis, where customers experienced HDTV on a comfy couch in a living-room setting. Flavia, makers of a coffee home-brewing system, offered a warm cuppa' joe to shoppers at five malls in Chicago and Dallas including Mill's Gurnee Mills and Westfield America's Hawthorne Center. And Westfield lets customers test drive a new Hyundai on a racetrack built in the parking lot at eight of its California malls.
“I think the concept of what is a mall and what it stands for is undergoing incredible changes,” says Christian Davies, vice president of design strategy and creative director for FRCH Design Worldwide. “It's trying to reengage people and trying to get people back in more often.” And, by definition, lifestyle centers promise entertainment.
The pop-ups may have a museum or art gallery-like feel, especially when a company is selling a brand, not merely products.
A year ago, holiday shoppers at Caruso's The Grove in Los Angeles could do more than check out sales at Nordstrom's or ride the center's electric streetcar. They could also view the original piano from the movie Casablanca, the unforgettable bird statuette featured in The Maltese Falcon or a shooting script from The Wizard of Oz, courtesy of Turner Classic Movies.
Landlords usually charge companies for this space, but Caruso gave it to Turner for free. Center owners have learned that consumers don't just want entertainment; they demand it. And Caruso decided bringing an interactive exhibit would please shoppers and keep them at The Grove longer than they would otherwise stay.
Target is considered by many to be the granddaddy of pop-ups. To introduce Isaac Mizrahi's new fashion design for women, the discount chain opened a 1,500-square-foot pop-up in Rockefeller Center. For Christmas one year, it tied a 220-foot barge with bull's-eye-shaped boughs to a pier in the Hudson River. The retailer wouldn't comment.
Another early innovator was Levi's, which occupied a space for six weeks in 1999 in New York. It was designed by New York-based Pompei AD, which this past holiday season created a temporary store for 66 Degrees North, an Icelandic maker of cold-weather outerwear introducing its brand to the U.S. market.
“It's a great way to test a particular market,” says Ron Pompei, Pompei AD CEO. The 66 Degrees North store was complete with the country's music, featured Icelandic travel agent and videos of the dramatic terrain as well as a selection of the apparel maker's designs.
Target's and Levi's early successes and the resulting publicity has led an increasing number of other retailers to try the concept. JCPenney launched Colin Cowie's exclusive bridal collection on Fifth Avenue in New York in the fall of 2004, with a store opened for one week that held four “instant weddings.” Expect to hear about a new, bigger, pop-up venture in March, says a Penney spokeswoman.
Besides earning publicity, pop-up stores provide an opportunity to study and test customer behavior, says Kevin Appelbaum, managing partner for consulting firm Hawk Hill Advisors. “You can set the shelves a certain way one day and then come back in and reset the shelves either with different products or a different mix,” says Appelbaum. “You can understand in a real world environment which buying and selling approaches worked best in the store.”
And while retailers seem to prefer using venues outside the mall for their pop-up concepts, many brands see shopping centers as a great way to introduce their product. “The advantage of the mall is that you have guaranteed traffic, and unlike the street front in the urban market, people are usually at a mall to buy,” says Mark Klockner, owner of Klockner Realty Inc., which creates pop-up strategies for Voom and Flavia, among others. Working with marketing company EventNet USA, Klockner hires and trains staff as well as handles leasing from mall or retail space owners.
At the Flavia store, patrons could sample up to 20 different flavors of coffee and tea while providing customer information. For example, an informal survey confirmed that women tend to make the major buying decisions during mall trips; a fact which will be used in Flavia's future marketing campaigns.
“Pop-up retail is the only form of marketing that can get a valid confirmation if the product will sell,” says Klockner.
Sears learned that lesson this past holiday season. For five days in December, it set up a 1,500-square-foot store, not at a retail center, but at ABC's Good Morning America studio in New York's Times Square area. There, it promoted last-minute gifts such as Kenmore coffeemakers and cardigan sweaters.
“What we really wanted to do was get consumers in and experience Sears in a new way,” says Rebecca Case, vice president of creative and specialty marketing at Sears, noting that the retail giant has no Manhattan store. “Here we could also have a more intimate contact with the customer because of the smallness of the space.”
It wasn't an easy project, however. Staff members had to dissemble the store every night during the week so that Good Morning America could be taped the next morning. In order to take apart the store quickly, in 45 minutes or less, all the display cases were placed on wheels. Then, after the show, it would be quickly reassembled.
Case wouldn't reveal sales or earnings figures for the pop-up, but profit isn't the goal for neither the lessor nor the lessee. It's all about creating buzz and increasing traffic.
Early adapter Meow Mix took over a storefront on Manhattan's Fifth Avenue for one week and offered cat food at Meow Mix Cafe. While the entire operation cost about $200,000, the company estimated it received about $2 million in market visibility, says Norma Lynn Cutler, president of branding and California-based marketing firm Cutler Enterprises.
In fact, the 30,000-square-foot Wired store didn't actually sell anything. Consumers, however, could sit down at one of the laptops linked to a temporary Web site, www.wiredstore.net, to order neat gizmos.
There are essentially two different types of pop-up store, says designer Pompei: Those that sell products and those that are developed by the marketing and advertising departments to generate brand recognition.
For example, Pompei created a pop-up for Kodak that didn't sell any products, but, rather, gave visitors an opportunity to work with their own photos, cropping them and printing them using different equipment.
And, this past holiday season, also in New York, espresso maker Illy leased a 3,500-foot space to create Galleria Illy, which was kind of a coffee themeland — part classroom, part library, part art gallery and part coffee bar.
Illy featured talks by leading guest experts including chocolatier Jacques Torries and food journalist David Rosengarten. And, of course, cappuccinos and espressos were available.
In the end, it's about the “immediate buzz quality,” says designer Pompei. “And it's a great laboratory for learning without making a big commitment.”
— With reporting by Beth Karlin
CBL & Associates Properties Inc. has come up with a creative use for empty space: It will award free rent and other benefits, worth a total of $200,000, to three companies that present the best business plans for new retail.
While it will be forking out money rather than getting rent for the empty space, the Chattanooga, Tenn.,-based developer reckons that it will benefit from the Piedmont Retail Challenge by introducing new ideas to the retail environment, according to Stephen Lebovitz, CBL president.
The winners will move in to three North Carolina malls rent-free for up to a year and also receive free advertising, free graphics, design and printing services, and offices supplies. Participating centers include Hanes Mall in Winston-Salem (pictured above), Randolph Mall in Asheboro and Oak Hollow Mall in High Point. Oak Hollow will also pay construction costs for adapting the space to meet the business's requirements.
“CBL is committed to cultivating economic growth and development for new and innovative retail concepts at each of the mall locations,” says Lebovitz.
Business plans, due April 29, will be judged by a panel of experts with financial, leasing, management and marketing expertise and will include shopper input.