Retailers across the country are grappling with the Internet and its effect on retailers with physical locations. People are making more purchases online and foot traffic into stores is in sharp decline. This decline is forcing landlords nationwide to be creative and come up with clever “adaptive reuse” projects for their properties as well as ways to create near term revenue while properties sit empty waiting for new, long term tenants. In fact, the problem has grown so large that, “there’s about a billion square feet of retail space that needs to go away, that needs to be converted, for the market to get healthy,” CoStar director of retail research Suzanne Mulvee stated at a Bisnow event in April.

One of the most creative methods landlords and retailers are using to generate revenue are pop-up stores. The idea behind a pop-up shop is to create a short-term store that will generate buzz, then it closes on a preplanned date and moves on to a new location or stays closed until there is a new product. Retailers partner with landlords on individual projects and the results have been an upsurge in pop-up stores nationwide. The short-term leases generate much needed income from empty retail space and can help a brand build its reputation while additionally serving the community.

However, there are many new and innovative pop-ups appearing around the country. One type of shop is the experiential pop-up. The idea is for up and coming retailers to showcase their brands in areas where they don’t currently have a presence to test retail ideas and give exposure to their product.

One such pop-up, the In Real Life (IRL) pop-up store which recently opened at Water Tower Place in Chicago, allows experiential shopping by combining over a dozen brands into one showroom allowing visitors to touch, feel, and use these products in real life before buying. When shoppers are ready to purchase an item, they can buy directly from the brand’s website and have the item shipped to their address. An experience such as this merges the best of online buying with the in-store experience that many strictly online retailers would not otherwise be able to duplicate.

In the northeast, especially in New York, New Jersey and Connecticut which all have dense populations and high retail vacancy rates, another pop-up that is gaining in popularity is the Halloween costume store. It is very difficult to see if you will really like a costume without touching and feeling it and for some costumes, especially for adults, to try it on. The Halloween store is another experiential store that is successful and takes advantage of the strengths of a physical location.

At least for the near term, pop-ups are a hot trend that will help take some pressure off both retailers and landlords. Stay tuned for more insights on the latest retail trends as we prepare for the upcoming ICSC Centerbuild Conference in Scottsdale, Arizona (November 28 - December 1).

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