Retail Trends

The Pop-Up Store as a tool for product development

Written by Stephanie Kidder

Bottom-up approach

Defining a brand’s identity and developing a product is often regarded as a top-down process. Working from such an understanding means a brand’s message is announcedcustomers are enticed or convinced, and products are sold. However, if we think in terms of a dialogue, a brand becomes a story, customers are participants, and the outcome of that conversation is a product.

Pop-up stores follow such a logic very well. Both starting and established brands can use pop-ups to enter new markets at the local level, engage customers in a personal way, start a conversation and build loyalty. Involving customers in the process of product development facilitates a shared sense of ownership and changes your customer base from ‘audience’ to ‘community’. This is more sustainable in the long run.

In the end, it is all about customer experience which relates to how customers perceive the full scope of their interactions with your brand, and according to Huffington Post 70% of companies that deliver outstanding customer experience rely strongly on customer feedback.

Pop-ups for Start-ups 

Sometimes an idea simply pops up, followed by a strong conviction that you’re on to something. In 2016, this happened to Amrita Singh, Lindsday Agnew and Jo Lusted, who were inspired during a holiday to San Francisco to test out a business about toast. Noticing a unique food trend in California, offered by toast cafes, the friends began to fantasize about trying out a similar concept in Toronto.

Unable and too unsure to rent a permanent storefront, they opened a small weekend-only pop-up store, aptly named TOAST, for a couple of weeks in the waiting room of a dermatology clinic. Drawing heavily on social media, they were able to attract customers, test the market, get feedback and improve their products on the spot.

In this case, the pop-up strategy allowed the three entrepreneurs to act quickly, keep costs to a minimum and refine their product in direct response to their customers’ feedback. In addition, this low-key, local and personal approach became part of the brand’s origin story, which adds to its charm and relatability.

A similar start-up story is told by the small brewery Hopper Bräu, based in Hamburg. Prior to entering the market confidently with their brand of beers, they ran a pop-up store for four months in the ‘Rindermarkthalle St. Pauli’. Initially serving two experimental beers, founder Lars was excited to learn from customer feedback, directly interact with potential customers and find out whether his enthusiasm was shared by others. The launch party was attended by over 200 people and within 6 weeks the first ration was completely sold out and in need to be replenished.

Keeping the conversation going

That start-ups are mindful of customer feedback is not surprising. The true challenge is to grow your brand and become established without suffering from so-called consumer amnesia, where – apart from selling situations – companies forget how to have routine conversations with customers.

LEGO is a case in point when it comes to a brand that continues to include customers – both young and old. Regularly using pop-up venues around the world to touch base, LEGO also set up LEGO Ideas which is an online community where fans can share creations and submit product proposals. If a proposal gets 10.000 votes, LEGO reviews the idea. Periodically a winner is announced. The creator will not only be consulted for final product approval but will also be acknowledged on all packaging and marketing and earns a percentage of the global sales of the product.

Another company that involves customers in its innovations is DHL, the world’s largest mail and logistics services company. DHL frequently organizes hands-on workshops in Germany and Singapore to think about solutions that can improve the experience for everyone.

One of the inventions that came from such a workshop was the Parcelcopter, a completely autonomous drone which delivers goods to people’s doorsteps in hard-to-reach locations. The business results for DHL have been amazing. According to Forbes, DHL’s efforts to involve customers in product development has resulted in customer satisfaction scores rising to over 80% and has caused customer churn to decrease.

The versatility of pop-ups

Whatever your business may be, and at whatever stage it may find itself, the merits of involving customers in both brand and product development are clear.

Launching a pop-up as a start-up is a good way to test the market and refine your product before taking the big leap. As an established brand, a pop-up can be a great way to keep in close touch with customers, test a new product line, involve them in innovation or include them in a creative community.

The pop-up venue can serve a lot of different functions and as this understanding continues to dawn upon both starting and established brands, over the coming years we can be sure to see a great deal of creative interpretations of the pop-up.

 

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About the author

Stephanie Kidder