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The unexpected pairing of pop up shops & technology

It turns out that retail is not dying - it’s just fundamentally changing. The declining returns of endless shelves stocked with boundless products has given way to unexpected and experiential manifestations of brick and mortar. Some of this change is driven by retailers experimenting in their existing stores, while plenty is also driven by brands experimenting with physical retail in the form of pop up shops. What used to be a practice for street vendors to sell their products has been transformed over the past decade into a crucial tool for brands to get their product into the hands of shoppers and gather important feedback.

One of the biggest effects of this shift is evolution from stores as a sales tool to stores as a marketing tool. Before the internet, a store was the only place to buy a brand's products. If a customer journey includes five steps - acquisition, discovery, awareness, consideration and conversion - a store had to cover all of these scenarios if it wanted to make money. Once the internet made dreams of endless selection a reality, physical stores we’re freed from being strictly transactional. Put differently, the internet unbundled the five steps of the customer journey.

We’re now seeing stores - and especially pop ups - increasingly focus on discovery and awareness, the earlier parts of the customer journey. At the same time, ecommerce shops can focus on the more transactional aspects of the customer journey, such as consideration and conversion. Bonobos Guideshops fill this role, allowing shoppers to discover the brand and figure out their fit, while pushing most of the transactional aspects of the journey to the brand’s ecommerce site. Everlane’s Shoe Park, a pop up that allowed shoppers to try the brand’s shoes on a small obstacle course, is a modern manifestation of the powers of targeted experiences for discovery and awareness. Raden, a direct to consumer luggage brand, created a striking art installation with its luggage to draw people into the store and the brand. And Glossier - a brand born into a loyal following from the beauty blog IntoTheGloss.com - is experimenting with pop up shops across the United States, following the opening of its first flagship store in New York City in late 2016. The beauty line formulated trust and brand recognition before ever creating a product. The appeal is heightened as loyal followers are able to test out Glossier products for the first time.

As the purpose of stores change, the technology that powers them needs to as well. While it used to suffice to have a clunky point of sale system on a big counter in the center of the store, it’s no longer good enough. Sales associates don’t like these system and make their opinion known by capturing very little data about their customers. Static point of sales systems also don’t allow shoppers and sales associates to interact and transact anywhere in the store, which is the best possible experience.

As pop ups increasingly play the role of physical billboards, brands need to extract as much data as possible about customers, in addition to garnering tons of feedback about its products. Pop ups are excellent venues for testing and learning, but brands and their sales associates need the right tools to succeed.

This is why I’m so bullish on mobile impact on physical retail. It’s already clear that mobile is driving shopping online and offline, with the majority of shoppers using their phones to research purchases. But mobile is also the key to maximizing the value of pop ups. Think about the customer journey that leads a shopper to a pop up. She likely starts by finding a brand on Instagram or getting an email with the pop up shop’s info. Maybe she even walks by it on a weekend. Once she arrives, she’ll spend the first few minutes looking around, maybe talking to someone, and then she’ll pull out her phone to look back at Instagram or at the brand’s website. Maybe a sales associate will greet her, tell her more about the brand and its products, and then ask for her email address if she wants to learn more and hear from the brand in the future. Maybe she’ll buy something and maybe she won’t. But with the right tools, this interaction is the beginning of a long-lasting relationship between the shopper and the brand, not another throwaway interaction for a sales associate. Maximizing these interactions is only possible if sales associates have the right tools to collect data and check customers out—all in the palm of their hand.

Mobile makes pop up shops successful, for shoppers, brands and associates alike. As the industry keeps shifting, marketing spends increase alongside growing competition for similar customers, creating physical footprints becomes increasingly important. Some of these experiments will be successful and turn into permanent stores, while others will be more fleeting, but brands that can be nimble and experimental will leap beyond those who are not. Along the way, mobile’s impact will only grow. Brands can develop customer experiences that span online and offline, giving shoppers an enjoyable first or second interaction with the brand, all while ensuring it’s not the last.

Stephan Schambach, Founder & CEO

Stephan is a serial entrepreneur with a proven track record of creating and growing successful tech companies in the United States and Europe. Under his leadership and vision, he brought Intershop and Demandware to IPO's with multi-billion dollar market caps. As Founder and Chief Executive Officer of NewStore, Stephan is setting out to change the market once again. This time by solving the omnichannel problem facing so many retailers and brands.

Topics: mobile, pop up store