Emerging Trend: Pop Up Retailers

It looks like an emerging trend for retailers is the pop up retail store.  What is a pop up store?  It is a temporary, low cost store that a retailer can open very quickly, and target areas with temporary population growth or demand.  There is much less cost in the form of Cap Ex (Capital Expenditures), and the stores are often retrofitted into a current space.

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Whole Foods is the latest retailer to test this trend when they opened up their first pop up store in the Hamptons in Early July.  I think this trend has a lot of opportunity for retailers, as a way to increase revenue while reducing costs.  If you look at the Whole Foods store example, the store has access to a very affluent customer base, with little in fixed costs.  Since this location is a summer vacation destination but empties out in the Fall and Winter, Whole Foods does not have to absorb the losses of slower sales months, which in retail, is very common.  Whole Foods could effectively turn seasonal retail sales it’s head, by making sure they are always where their customers are.

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As marketing professionals, we are trained to target where the most of our potential customers are through targeted media, interactive, and social channels.  This trend is a natural progression for retailers to better access their customers where they are, without taking on the high costs of buying land and building stores.  The opportunity goes beyond food – any retailer could do this effectively with a sound strategy.

Retailers should watch this trend very closely.  If effective, Whole Foods could open pop up stores on college campuses in the Fall, and others in key vacation destinations like the Outer Banks in the summer.      It is definitly a trend to watch for all retailers defending their market share or looking for an alternative way to grow sales.  The only challenge I potentially see is labor – I would venture to guess finding part-time help in the Hamptons might be a challenge due to the affluent demographic profile.

Chris

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