The Effectiveness of Pop-Up Shops and Partnerships

During a recent visit to New York City, I passed through Grand Central Station. There, I saw a hotbed of shopping activity: A section of Grand Central had been converted into a series of pop-up shops. What had happened to the retail bust?

Group of friends sitting outdoors with shopping bags - Several people holding smartphones and tablets - Concepts about lifestyle,shopping,technology and friendshipDuring a recent visit to New York City, I passed through Grand Central Station. There, I saw a hotbed of shopping activity: A section of Grand Central had been converted into a series of pop-up shops. What had happened to the retail bust?

The small pop-ups were doing a brisk business, selling everything from jewelry to men’s toiletries to candles. The shops were small, but had tons of personality. The experience was interactive and fun.

This was not an isolated incident. Pop-up shops are making their presence felt across the retail industry. The concept is not new — bazaars and flea markets have existed for many years. But lately, pop-up stores have become ubiquitous in everything from restaurants to rock festivals.

They are used by online retailers who are looking to experiment within the bricks-and-mortar space, and by chain stores who want to experiment with new locations and venues. Fashion retailer Nordstrom has launched pop-ups at music festivals that offer products and feature photo booths.

According to PopUp Republic, a service provider to the pop-up retail industry, pop-up shops have grown into a $50 billion industry and expected to grow further in 2017.

Why do retailers invest in pop-ups? Smaller retailers or Internet start-ups can launch a low-cost shop to test the waters without a significant time or money commitment. A new bricks-and-mortar retail storefront can cost tens of thousands of dollars to launch and often requires a lease of at least five years.

With a pop-up shop, the commitment can be a matter of months, with an investment of a few thousand dollars. And consumers seem to love it. They can touch and feel the merchandise and get to know the creator or store owner. The interaction often results in a loyal following. According to pop-up expert, The Lion’esque Group, one international foods and goods marketplace increased their e-commerce traffic by 300 percent through pop-ups.

Another growing retail concept is the store-within-a-store. Large retailers have been partnering with smaller businesses to set up areas within their stores for a differentiated experience for the shopper. Macy’s announced a partnership with beGlammed to provide at-home grooming and makeup services, and Neiman Marcus recently announced a partnership with Le Metier de Beaute to provide services such as manicures and blowouts at affordable prices.

Plus, JCPenney has had a partnership with Sephora for years, providing a cute area within the store where shoppers can purchase cosmetics and get quick makeovers. In its 1st Quarter Earnings call, JCPenney mentioned Sephora as one of the areas in the store with positive comp store sales and there are plans to add 16 new Sephora locations in June. These partnerships fulfill the goal of the retailer to pull in a different customer set, while also fulfilling the desire for a quick, differentiated experience for the customer.

For retailers who want to test the waters with a low-cost concept, partnering with another retailer or setting up a pop-up shop may be a viable solution. And for the customer, it provides a new, interactive shopping experience.

Next time you’re in Grand Central during the holiday season, check out the shopping arcade. It may be a nice place to pick up that unique gift or chat with a person who makes hand knit scarves by hand.

Note: The views expressed in this blog are those of the blogger and not necessarily of Synchrony Financial.

Bah Humbug on Black Friday Emails

Congratulations if you survived another Thanksgiving with family. It can be a wonderful time of year, or contentious, depending on the circumstances. Also congrats if your inbox survived Black Friday. I’m still cleaning mine up, which is not easy with all the Cyber Monday emails hitting me left and right.

Congratulations if you survived another Thanksgiving with family without some sort of verbal fist fight breaking out over politics or the proper way to carve a turkey. It can be a wonderful time of year, or contentious, depending.

Also congrats if your inbox survived Black Friday. I’m still cleaning mine up, which is not easy with all the Cyber Monday emails hitting me left and right.

Because I’m a nerd for numbers, I applied some search parameters to see what really DID end up in my inbox. Then I made a chart. Stop laughing at me.

Melissa's Black Friday InboxBetween Nov. 1 and Nov. 27, I received 127 emails with “Black Friday in the subject line. The chart above breaks it down by percentage received by date (and yes, I clumped Nov. 1-Nov. 14 together, since most of those days I received maybe 1-2 Black Friday emails tops).

Amazon emailed me the most, taking up 13.4 percent of my Black Friday inbox overall (from Nov. 1-27, and 10.3 percent of my Black Friday inbox on the actual day (Nov. 25). NewEgg came in second, and JCPenney third (Fun fact: I probably haven’t ordered anything from JCPenney since 2013).

Now, as I look at these numbers, everything seems fairly reasonable. But here’s the thing: Over the holiday while visiting my family for 4 days, I felt like this every time I picked up my phone:

Too Many EmailsOkay, maybe that’s a bit hyperbolic, but I think at one point it got up to 36 unread emails. And what did I do? I cleared them all out, sometimes opening a message to see if there was a good deal, and usually not finding much beyond 20 percent off … which, c’mon! That’s a typical discount.

But maybe it’s just me. According to the National Retail Federation, 44 percent of consumers shopped online for Black Friday (while 40 percent trekked out to stores), and Millennials — my generation — helped to drive the increase in Black Friday sales. And according to information from an Adobe report, Black Friday online sales grew 17.7 percent over 2015, hitting $5.27 billion.

Black Friday Sales MemeLook, I can be sassy about this because it’s me. Again, I realize the days between Black Friday and Cyber Monday are huge for retailers … but as I mentioned, the Black Friday “preview” emails started Nov. 1 for me.

I really don’t need 28 days worth of “Ooh look! Online deals! Buy them now!” emails. And having my inbox hammered for almost an entire month made me numb to most emails … I swiped left so many times to archive things I almost accidentally swiped my aunt’s email right out of my inbox.

Maybe I’m jaded because I’m familiar with how this all works. Maybe I’m burned out on unimaginative email copy and the same old bland offers. Either way, I say Bah Humbug to Black Friday. Give me #GivingTuesday … at least then the money I drop can go do some good in the world.