The underlying concept of a “pop-up shop” isn’t new. We’ve seen these temporary, transportable and small-scale retail hubs appear as kiosks in malls and Halloween costume or Christmas-themed stores that are in a retail space for just a few months at a time.
In the past five years, though, more small businesses have been popping up stands and kiosks inside the retail spaces of other small businesses or temporarily taking over vacant storefronts. Pop-up shops have exploded into a full-blown trend, growing 16 percent annually since 2009 and expected to generate $80 billion annually, according to a 2014 Fortune report.
What’s pushing this boom? Turns out, even though online retail accounts for $259 billion in yearly sales in the U.S., a lot of people still prefer to shop in person. According to a February 2014 study by the financial innovation research center Accenture, 78 percent of online shoppers are just “webrooming,” or researching an item online before going into a local store to buy it.
“For many shoppers, not being able to try on a product before purchasing can be a very real pain point,” says technology blogger Humayun Khan in an article on the Spotify blog. “There’s just something about being able to touch before you buy.”
For bigger retail chains, popping up is more about generating a new revenue stream, connecting to customers and offering a physical exchange and product return spot. For small businesses, though, popping up is about cooperative retail, face-to-face owner-to-customer interaction and low overhead.
In Kalamazoo, small businesses are popping up in temporary retail spaces on short-term leases and also in the spaces of other local businesses. Satellite Records, which has a physical location at 808 S. Westnedge Ave., has been popping up in venues like Bell’s Brewery for the past two years, says Satellite manager Sean Hartman.
“Having a lot of community involvement is really important to us,” he says. “We like to reach outside our store, reach new people and affect the community around us.”
Satellite Records doesn’t pop up solely to sell but also to help promote events, says Hartman. It’ll be popping up at Bell’s on Jan. 3, sponsoring a show by Tyvek (a noise pop band from Detroit) and Jan. 29 as part of a pop-up dance party. Satellite Records has also popped up at WIDR (Western Michigan University’s student-run radio station), the Proper Lab, Louie’s Trophy House & Grill, the State Theatre and the Kalamazoo County Expo Center & Fairground.
When pop-up shops aren’t sponsoring or promoting events, they work with other retailers or businesses to offer on-site diversity. One example is Tulips Little Pop Up Shop, a women’s clothing and accessories boutique owned by Kristi Tyler. Not only does Tyler operate a temporary shop at 2030 Parkview Ave., where she has a six-month lease and runs a regular schedule, but her business also pops up in other retail spaces such as Urban Modern Hair and The Barre Studio and at home parties. She kicks back some of her profit to the shop owners.
These space-sharing pop-up shops are gaining popularity in bigger urban centers like Los Angeles; Charlotte, N.C.; Portland, Ore.; Vancouver, Wash., and Seattle. It might be chefs popping up on a Monday to cook in a restaurant other than their own and profit-sharing the promotional event, or it could be a baby clothes boutique popping up in a women’s shoe store. The point, according to a 2013 CBS trend report, is to share inventory in a way that draws customers for both businesses.
That’s what Tyler is doing when her shop pops up in a hair salon — bringing her products directly to her demographic and offering a dynamic experience to salon-goers. So far, the response has been positive.
“I never realized what a buzz it would create,” she says. “It’s a lot of work to pack and unpack, but it’s really been quite successful and I think the customer service is key.”
Being able to buy a unique product from the small business owner directly is an experience many people crave, Tyler says. Fortune magazine analysts agree, saying predictions that online sales will shut down brick-and-mortar facilities haven’t proved true — people want community and connection.
Handmade Kalamazoo offers a broad community connection with its collective pop-up experience, says owner Melissa Al-Azzawi. “We started out utilizing the pop-up shop model so that we could market, promote and sell the works of Kalamazoo makers, from soap to honey, clothing to guitars, local music to underwear, and we have done so with over 100 folks,” she says. “Our model works because we are not simply selling a product; we’ve created a community at Handmade Kalamazoo.”
The pop-up collective popped up in a temporary space in downtown Kalamazoo during the holiday shopping season; it was its fourth pop-up shop experience. The group has previously popped up in the Vine neighborhood and on the Kalamazoo Mall.
Community is just one perk of pop-up retail. Testing revenue streams, marketing merchandise around an event or holiday, unloading old inventory and generating brand awareness are the other pluses powering this trend, say the experts.
As more businesses tap into the benefits, look for more pop-up shops in Southwest Michigan.