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Pop-up shops are here to stay

The temporary store is now an established part of the retail landscape as empty retail units go begging, but is there real value in it for the fashion sector?

The pop-up phenomenon has been around for almost half a decade. Sportswear brand Nike and US giant Target were among the first to see an opportunity, creating temporary spaces that, at the time, seemed to disappear almost as quickly as they appeared. Now, as we exit the noughties, pop-up stores are much less of a retail exception and more an
established fact.

The notion of the pop-up becoming established is something of a contradiction, as their ephemeral nature would seem to preclude this. Yet perhaps from the moment in 2006 when fast-fashion chain Uniqlo decided to open stores in repurposed shipping containers located around the world, pop-up stores became a familiar part of the commercial landscape and today can be seen, in various forms, almost everywhere.

The rate at which pop-ups are appearing has increased – a response in part to the recession, which has left empty units in high streets and shopping centres and given landlords the job of papering over the cracks. One solution that many have hit upon is to offer space at peppercorn rents for a limited period, presenting an opportunity for brands and retailers.

Marks & Spencer director of store marketing and design Nayna McIntosh is clear about why retailers might wish to avail themselves of units that are virtually going begging. “I think pop-ups work for retailers because they get you into new territories and, from a customer’s perspective, they get access to brands they might not otherwise see,” she says. “The retailer has the opportunity to spend and flex according to the time of year, and this has got to be valuable.”

Marketing gimmick?

This all sounds fine, but does leave a simple question unanswered. Having entered the marketing mainstream, are pop-ups now accessible to all: are they commercial, or are they marketing
flimflam – nice but not necessarily need to have?

There is also the matter of price. Hannah McNamara, senior surveyor in the shopping centre leasing team at Cushman & Wakefield, says that, for landlords who want their units occupied up to Christmas and to have rates and service charges covered, it makes sense to allow short-term tenancies for less than 5% of the commercial rate, or to organise deals where landlords get a percentage of the turnover.

McNamara cites streetwear and boardsports indie Plain Lazy, which has just taken a short-term lease – until the end of January – for its fourth bricks and mortar outlet in Cardiff’s St David’s Centre. “There’s no way they could afford to be in that location if they were paying the full rate,” she says.

She also notes a “well-known designer” who has issued instructions to find a pop-up store to open on South Molton Street, Regent Street or Oxford Street in London after Christmas, in order to test the market without the risk of a long and expensive tenancy. This, she says, will become a reality post-Christmas – although it will be the exception in opening at that time, as most retailers will be capitalising on the seasonal rush and then retreating in the seasonal doldrums of January. 

Simon Threadkell, creative director of design consultancy Fitch’s London studio, says pop-up shops remain a weapon in the armoury of retail marketing. “I think they’re a recognised tool to get people to think about a brand. It’s a kind of campaign,” he says. “Traditional ways of communicating as a brand have become less effective.”

He notes that, for larger retailers, setting up a pop-up shop is an alternative to TV advertising, where audiences continue to fragment and the price of entry is still high.

“You have to consider a pop-up shop as part of a marketing campaign, rather than looking at it in terms of shopfit pounds per square foot,” Threadkell adds.

This brings into view the other point about pop-up shopping, whether you’re a large multiple or a single-store indie. It’s one thing to get a store unit cheap, but you still have to invest to make it the sort of place that shoppers will want to visit. If you consider the kind of pop-ups that have made the headlines – whether it’s Gap’s stores that appeared worldwide this autumn to mark its 40th anniversary, including one in London’s Kingly Court, or the Dr Martens store in Spitalfields – these ventures will cost money. Even Toast, the French Connection spin-off womenswear chain, has got in on the act with a store that will trade in Cheltenham until Christmas.

In the normal run of things, attracting customers into shops will frequently involve the services of an expensive design consultancy. Then there’s the cost of the shopfit and getting someone to install it all. However, the best pop-ups manage to punch above their weight in terms of impact by adopting what may loosely be termed ‘rough luxe’.

Nike SB, the skateboard offshoot of the main sports brand, has just closed in Berlin and is a prime example of this approach. This was a small unit where imagination and attitude have been the substitutes for the cost of a full-blown fit-out. The shop used one of the two rooms to install a half-pipe, where enthusiasts could test-drive the merchandise, and the distressed wallpaper and raw concrete floor had been left in place to create an urban environment.

This was a low-cost fit-out, similar to what has been done in the Dr Martens store, where wooden palettes, shrink-wrapped objects and yellow fluorescent tubes provide the interior.

Tough call for indies

So if the cost of entry can be this low, why hasn’t the indie sector made inroads on the pop-up sector? Matt Kay, store manager at Bury St Edmunds menswear independent Six Whiting Street sets down the case for not taking the plunge. “As an independent business, it’s a difficult one. I can see that it would serve a purpose, but it might also dilute your brand,” he says. “With independents, you put so much into your business that you don’t really have the time to concentrate on other things.”

So will empty units that can act as pop-ups still be around when the New Year celebrations are a hazy memory? McNamara says many pop-ups that appear for Christmas will not be around in the early part of 2010.

However, Land Securities commercial director Ronan Faherty says he thinks the early part of next year will be characterised by fresh pop-ups as retailers seek new ways to test-drive formats and brands. “I’m actually surprised there haven’t been more for Christmas. It hasn’t been as big as I thought,” he says. “There will certainly be a place for this kind of thing in early 2010 though.”

Pop-ups remain an effective way of getting noticed and one that the independent sector might consider. Even allowing for a reasonable run-in to Christmas, it is probable that there will be a mountain of stock waiting to be sold as a result of the many administrations that have taken place this year. Brands, retailers and indies should all be alive to pop-ups as a possibility.

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