26 Aug 2020 • Retail
Retailers are leaving town in search of customers – will they return?
Pop-up stores are not only a mechanism for brands to reengage wary consumers, but also to better understand how to exist outside the city centre.
As we recently covered, consumers are warming back up to the idea of interacting with brands beyond the screen. A recent YouGov study showed that a significant minority of US consumers are already reengaging with brand activations. A fifth have recently attended a pop-up shop, while 17 per cent have visited a brand installation. Millennials are the most eager to interact with brands in this way, with just under a quarter either ‘very likely’ or ‘somewhat likely’ to visit a brand-organized event in the next 12 months. Given continued consumer anxiety about spending time in busy public places, where exactly are they engaging with these brands? More accurately, it seems, the question should be ‘Where are these brands engaging with them?’.
‘For most brands, their retail strategy has, historically, been to hit the big cities first,’ Melissa Gonzalez, CEO of The Lionesque Group, told Vogue Business. ‘But places in New York, like Times Square and Midtown, rely so much on commuters and tourists, that's going to be an uphill battle.’ The solution, Gonzalez believes, is for brands to follower their customers and skip town, revealing that one of her clients (unnamed) has made a month’s revenue in a week since refocusing on high-net-worth New Yorker’s traditional bolthole, the Hamptons.
Whoever they are, they’ve joined a line of brands decamping to the eastern end of Long Island. Department store Nordstrom will pop up at a beach club in Montauk through the end of August, offering activewear product lines drawn from their NYC flagships. Jimmy Choo has been relocating to the area every summer for several years, but have doubled down of the mantra of ‘meet your customer where they are’ for 2020; their new Choo to You offer delivers a curated range of styles to local’s homes so that customers can peruse on familiar and (COVID-safe) ground.
Hit the road, not the high street
Though it had the option of reopening its main site on Manhattan’s Lower East Side, fragrance brand D S & Durga also decided create a more mobile alternative. The brand’s Fumetruck serves chilled perfume to counteract the summer heat at locations across Manhattan and Brooklyn, which customers are able to text to find out its current route. The mobile platform means that brand doesn’t have to wait for footfall to recover, but can rather chase it around the city, all whilst offering an experience that doesn’t require customers to over-share enclosed air space. . .particularly relevant to the fragrance testing process.
‘When you’re small, you can pivot as much as you need,’ cofounder David Moltz told Women’s Wear Daily. ‘If the truck is successful, we can do another in another city. We decided to do a truck because people want to feel safe to shop, even me. When you’re outside, you feel safer. Inside, it gets tense, and nobody wants a tense shopping experience.’ When even DHL – which already has over 7,100 service points in the US – is creating a fleet of portable shipping hubs to add greater ‘convenience’ and better service ‘local demand’, you know that businesses are anticipating a shift in how accessible their consumer base will be moving forward.
Learning to live local
Indeed, the exodus from town and city centres is both real and likely long lasting. As we recently explored, this will mean a repositioning of the local high street as the front line for brand engagement. Data from Appear Here, one of the leading brokers of temporary retail space, has shown a marked shift towards businesses looking to touch down in residential areas over the last quarter, with London’s Westbourne Grove, Neal Street, Curtain Road, Columbia Road and Golborne Road the top five targeted locations. In Paris, you’re currently more likely to find brands suddenly appearing on rue de Turenne, rue Pierre Lescot, rue du Roi de Sicile, rue de Charonne and rue Debelleyme than in the golden triangle or around Haussmann-Opéra.
Many will be using this as a means of hastily figuring out what their retail offer looks like when it’s small and local, rather than for a flagship. Some (few) have already laid this groundwork. While Nike’s new House of Innovation megastore in Paris might have caught the headlines last month, the real insight into the future of the brand’s retail strategy came back in May. During the sports apparel brand’s quarterly earnings call, CEO John Donahoe revealed it would start building 200 ‘small-footprint, digitally enabled mono-brand stores’. These will be based on the Nike Live store it first trialed in Melrose, California, which uses data from the local users of the Nike app to constantly adapt its product offer. The message to others is pretty clear: it’s time to get out into the community.
Hero image: Nike Live's first trial store, in Melrose, California.