The Coronavirus pandemic and subsequent events of this year have exacerbated the ongoing decline of the British high street, with footfall falling by 81% in April and 48% in July, according to the British Retail Consortium. From John Lewis to Carphone Warehouse to House of Fraser, it seems that no retailer, no matter the size, is safe from the impact of the stay-at-home order.
Costly rents and reduced footfall have left retailers with no choice other than to reconsider having fleets of stores, but this is not to say that customers no longer wish for in-person retail experiences. Store closures are not for a lack of want; on the contrary, as for many, as lockdown is slowly lifted people are craving the human experience more than ever. But with a stronger online presence in the mix, most customers need to go to the store less often and retailers are simply unable to cope with the ever-growing financial pressure inherent to keep a physical store open. Physical stores have become luxury.
Where it’s no longer fiscally realistic for retailers to have permanent stores in every town centre up and down the UK, a gap in the market opens up for a more flexible in-person experience and this is where retailers are starting to consider pop-ups as a viable alternative. Brands don’t need to commit to long-lease agreements and empty properties can be filled with a rotation of exciting new experiences for consumers.
Pop-ups allow retailers more flexibility, can be used in any way a brand desires and ultimately can be scaled up or down as needed, dependent on consumer demand and government regulations. They are designed to be easily built and taken down, and in a year defined by uncertainty this is highly appealing. Where many are asking questions about the future of the high street, pop-ups may provide the answer.
We are seeing more retailers grow more open to the idea of pop-ups. Based on current trends we are seeing there are two different distinct circumstances in which retailers are keen to explore. The first more common reason for considering a pop-up is experience, connection, and entertainment. This is what we most commonly associate the idea of pop-ups with.
Until recently, brands looking to create this type of storefront might do so to promote a new product launch or experience. Towards the end of last year, Glossier held one of London’s most successful pop-ups giving customers the chance to experience Glossier products in person, and the likes of Oatly used pop-up stores to allow customers to taste test new vegan products. This style of pop-up is focused on engaging new audiences and in creating a unique space for brands to express creativity.
The second type of pop-up is a more practical one where we see these temporary stores acting as fulfilment centres. This type of pop-up bridges the gap between online sales and the physical store and can be used as a place to drop off returns, showcase products in person or be used to supply heightened product demand. This type of storefront uses data to explore what customers need and provides more of a service than an experience.
One of the crucial things this pop-up can offer is the ability to talk to a member of staff in person, satisfying the need for good, accessible customer service. A pop-up of this nature might be a gift store opening up in a train station around Christmas or an online store creating an in-person drop off point for easier, cheaper returns.
Whether a brand seeks to build a pop-up for entertainment or for fulfilment, the benefits of these types of stores become more apparent with the ease of lockdown. A direct high reach will be harder to achieve in the coming months. People are no longer congregating in mass in town centres or in shopping malls and instead are choosing local alternatives for shopping or no shopping at all, preferring spending free time at home or outdoors.
As pop-ups can be easily constructed anywhere and are not as limited by physical structures, brands are able to make use of unexpected locations creating surprising market stalls or outdoor installations. Pops-ups then become online talking points.
Pop-ups also enable a brand’s creativity; all the usual rules of a store go out the window and retailers are free to experiment with new design, products and techniques. Here brands might choose to use a pop-up to collect insights on customer behaviours which can then be used to inform wider buying strategies or loyalty schemes and connect the on- and offline.
New technology can be experimented with and integrated later at scale to enhance the experience for customers – for example, makeup brand Charlotte Tilbury experimented with augmented reality mirrors to allow consumers to try on makeup without touching the actual makeup itself.
Of course, there are still circumstances where a physical store is preferable. For example, when purchasing a high ticket item like kitchen fittings or furniture, it’s extremely reassuring for customers to be able to go into a store which gives the impression of longevity.
However, the future will see pop-ups become more highly integrated into business models for all types of retailers. We might even begin to see more retailers run hybrid online-pop-up-flagship store strategies or be more flexible with this model year-round. Where the Coronavirus pandemic has drastically changed retail shopping habits forever, we must now begin to think more creatively, embracing pop-ups and other more flexible creative strategies to continue engaging consumers.
Sandra Perriot, strategy director for Commerce, Retail and Experience, Cheil UK