Pop-up stores: an ideal busi­ness test bed

China Daily (Canada) - - SHANGHAI - By WU YIYAO in Shang­hai wuyiyao@chi­nadaily.com.cn

Pop-up stores have be­come in­creas­ingly pop­u­lar in Shang­hai and have ap­peared in more than 20 shop­ping malls in the city over the past year, ac­cord­ing to re­search by real es­tate ser­vices provider RET.

In­dus­try ex­perts also sug­gested that this phe­nom­e­non is tak­ing place be­cause popup stores al­low busi­ness own­ers to ef­fec­tively test mar­ket re­sponse at a low cost.

Wang Zhong­hai, a for­eign prod­ucts dis­trib­u­tor, said that a pop-up store that is open for just one week in a ma­jor shop­ping mall in Shang­hai is equiv­a­lent to a month’s worth of mar­ket re­search.

“As a brand dis­trib­u­tor you get first-hand find­ings at a pop-up store. You will see what prod­ucts, col­ors, pack­ages and price ranges are most ap­peal­ing to con­sumers. Such in­for­ma­tion helps a brand bet­ter pre­pare for en­try into the China mar­ket,” said Wang, who has in­tro­duced a va­ri­ety of Nordic brands re­lated to home dec­o­ra­tions, kitchen­wares and tech gad­gets to Shang­hai.

Wan Xuet­ing, a 25-year-old post­grad­u­ate stu­dent and ama­teur jew­elry de­signer, had ear­lier this month opened her first pop-up store in Kerry Cen­ter, one of Shang­hai’s most pop­u­lar shop­ping malls lo­cated in the up­scale Jing’an district.

Though her store was only opened for two days, Wan man­aged to rake in some 3,200 yuan ($463) in rev­enue. But it was not the rel­a­tively good sales fig­ures that made her day — she said that the most re­ward­ing as­pect of run­ning a pop-up store was the ex­pe­ri­ence of be­ing an en­tre­pre­neur.

“I have thought of sell­ing my de­signs on­line, but I don’t have time to be on my lap­top all day, re­spond­ing to ques­tions from buy­ers. I also don’t have the cap­i­tal re­quired to run a brick-and-mor­tar store. The pop-up store con­cept is hence a good op­tion as it al­lows me to un­der­stand how the re­tail scene works and how to man­age con­sumers. I don’t feel any fi­nan­cial pres­sure be­cause the rent is af­ford­able,” said Wan.

Al­bert Lau, CEO of Sav­ills China, said that the pop-up store con­cept has been one of the driv­ers be­hind the re­ju­ve­na­tion of con­ven­tional shop­ping malls. He added that such tem­po­rary busi­nesses are par­tic­u­larly suit­able for prod­ucts such as jew­el­ries, ac­ces­sories, toys and snacks that are easy to try and trans­port.

“For mall op­er­a­tors, set­ting up a pop-up store also serves as an in­cu­ba­tor for fu­ture ten­ants. Pop-up stores that at­tract huge foot traf­fic are likely to be turned into per­ma­nent ten­ants,” said Lau.

An­other rea­son be­hind the pop­u­lar­ity of such stores is be­cause they usu­ally stock prod­ucts, such as de­signer crafts and rare books, that are not usu­ally seen in stores, which in turn makes for a more novel shop­ping ex­pe­ri­ence.

“It feels as if you have a dead­line for buy­ing some­thing at a pop-up store be­cause it isn’t a per­ma­nent fix­ture. Also, find­ing some­thing you like at a pop-up store is like an ex­cit­ing trea­sure hunt,” said Zhang Chuhuan, 28-year-old Shang­hai-based ac­coun­tant.

For mall op­er­a­tors, set­ting up a pop-up store also serves as an in­cu­ba­tor for fu­ture ten­ants.”

GAO ERQIANG / CHINA DAILY

Chi­nese main­land tourists pur­chase goods at a lux­ury store in Hong Kong be­fore the New Year. Hong Kong has been ex­pe­ri­enc­ing a de­cline in re­tail sales in re­cent years as tourists, es­pe­cially those from the Chi­nese main­land, are spend­ing less be­cause of the ter­ri­tory's pro­hib­i­tive prices in com­par­i­son with other coun­tries.

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