Are Pop-Up Shops Still Relevant in a Pandemic-Altered World?

Brands have been using pop-up shops to expand their physical presence and drum up excitement about new products, services and technology for years. After all, what better way to test a new market than with a store that doesn't require a long-term commitment? Then the pandemic hit – forcing nonessential retailers to temporarily close up shop, pop-ups included.

Although nonessential retail has opened back up in many places around the globe (at least in some capacity), the rise of COVID-19 hot spots is bringing new retail restrictions in some regions. The result? Brands are quickly reprioritizing their short- and long-term strategies to align with regulations (and shopping behaviors) that are changing rapidly. Smart retailers are recognizing that outdoor pop-up shops, perhaps in their own parking lots, could be the difference between being closed completely and being partially open. In addition to being a potential means of survival, pop-ups have the potential to make an impact in a number of ways, both during this crisis and after. Here are five ways pop-ups can still be impactful as retail's new normal takes shape:

1. Encourage (safe) in-person experiences. While some consumers couldn't wait to shop at their favorite stores after lockdown, others are taking a more cautious approach. To ease concerns, retailers can consider creating parking lot pop-up shops – a trend that has popped up in recent months. Since many health experts agree that the virus doesn't spread as easily outdoors, this strategy can help ease consumers' concerns. Plus, this may end up being the only way to sell in hot spot markets where retail restrictions are reimposed. Parking lot pop-up shops can be the first step toward providing a positive in-person shopping experience for cautious consumers who are likely to remember the retailers that are making safety a top priority.

2. Get involved with the community. In a socially distanced world, any meaningful connection you can make with your audience is a win – and bonus points if it is face(mask)-to-face(mask). At the beginning of the pandemic, British grocery retailer Tesco built pop-up shops to support the UK's National Health Services' Nightingale Hospitals by providing staff with 24-hour access to food and household products. Tesco had remained open throughout the pandemic as an essential retailer; however, the pop-up shop gave the company an opportunity to showcase its commitment and support to the community by providing a convenient service to workers on the front lines.

Although Tesco's pop-up shop isn't something that most nonessential retailers can replicate, it can serve as inspiration for other ideas that support local communities. For example, brands could donate a portion of proceeds from a pop-up shop to local coronavirus relief funds. Another idea is to partner with a local nonprofit and use the pop-up shop as a donation drop-off location – allowing consumers to donate items like clothing or nonperishable food while shopping.

Even without a charitable giving aspect, retailers can partner with other businesses for a socially distanced outdoor event that focuses on supporting local businesses. These are just a few of many ways pop-up shops can be tied in to a community involvement strategy.

3. Capitalize on the online shopping craze. People are spending more money and more time online, so why not "pop up" there? Some retailers have been creating digital pop-up shops during the pandemic to drive consumers to their websites and increase sales. While not traditional by any means, this strategy is pandemic-friendly, and the format is quite familiar – just think about some of the well-known shopping events, from Amazon's Prime Day to Mexico's Hot Sale or the 618 festival that takes place in China.

Although some towns and malls are working to create these types of virtual pop-up events for local businesses and tenants, some retailers are hosting their own events. British lifestyle brand Ted Baker, for instance, launched a virtual pop-up shop in May featuring limited-edition pieces with proceeds going to charitable causes (remember the community involvement strategy mentioned above?).

Regardless of how online pop-up shops are produced behind the scenes, retailers may want to think about incorporating livestreaming into the event. This can help stir up buzz on social media, and is a tactic that Chinese retailers have seen success with during the pandemic. Additionally, retailers with omnichannel capabilities could incentivize shoppers to choose curbside pickup as their fulfillment option during the event (as long as the retailer has a storefront present in the shopper's area). This can help move inventory out of stores while also getting customers familiar with flexible fulfillment options.

4. Sell discounted (out-of-season) items. If you are an apparel retailer, chances are that once lockdown restrictions were lifted, you began reopening stores containing inventory that was out of season. And if hot spots end up causing new lockdowns, even more merchandise could be frozen inside stores – leaving two choices: mothball or markdown. However, a pop-up shop could be the perfect way to stay open and mitigate markdowns. In California, for example, indoor malls were recently closed again due to a rise in COVID-19 cases, while stand-alone and strip mall retailers are able to stay open. This means that a pop-up store could be a lifeline for mall retailers to maintain a physical sales presence until restrictions are lifted again. For brands thinking about expanding their retail footprint in the future, the pop-up shop could even be used as a way to test the market of a new location. Speaking of testing…

5. Test things out. Historically, pop-up shops have been a good way for retailers to test things out – things like new products, services, technology and markets. During the pandemic, these temporary shops can serve the same purpose – and they may actually be a great low-commitment way to do so. Maternity apparel retailer Hatch serves as an example. The retailer is testing a new market (the Hamptons, an area that is a popular summer destination for affluent New York City residents) as well as a new strategy (a pop-up offering curbside pickup only).

"People are calling in advance, and we have their stuff ready to give to them as soon as they get there," Hatch's founder, Ariane Goldman, said in an interview with Glossy.

Supporting Your Strategies

Chances are that some pop-up shops might look more like a sidewalk sale than a temporary storefront during the pandemic, and that's okay. If a pop-up can help support your business as the industry's new normal takes shape – regardless of whether it is set up in a parking lot or as a pickup-only model – it is something to consider adding to your business strategy.

For more information on incorporating pop-ups into your retail model, download Aptos' 10 Things Retailers Should Consider Before Investing in a Pop-Up checklist.