PopUp Angels: ‘Drive Growth Using Pop-up Stores’
Li Yen, 2 Oct 17

Stores are popping up for a few weeks to a few months and creating a buzz in cities such as New York and London.

These pop-up stores are a cheaper alternative for retailers and marketers to showcase their products during a product launch or seasonal sale, doing away with the hefty one- or two-year rental bond.

Hermes’ laundromat-inspired pop-up shop had a recent run from June 14 to 18 in New York. The shop offered complimentary dip-dye services on the shoppers’ own Hermes’ silk scarves. (YouTube Screenshot)

For example, recently in New York, Reebok’s one-month ‘FLASH’ store and Hermes’ laundromat-inspired pop-up shop opened from June 14 to 18, offering complimentary dip-dye services on the shoppers’ own Hermes’ silk scarves and stopping passers-by in their tracks.

In Singapore, Chanel opened its pop-up Coco Cafe from April 8 to 16, 2017, at the Visual Arts Centre. At a setting similar to a Paris café, aside from sipping an afternoon tea, shoppers got a chance to try out Chanel’s new line of lip glosses—Rouge Coco Gloss.

Chanel’s pop-up Coco Café, opened from April 8 to 16 this year, at the Visual Arts Centre. (YouTube Screenshot)

The Chanel Coco pop-up café built a relationship with their customers by providing them with personalised services that e-commerce could never attain, such as makeovers, manicures, hand massages, as well as makeup tips from beauty advisors. (YouTube Screenshot)

This pop-up concept may still be relatively new to retailers in Singapore and Asia. However, this trend has been around in the US and Europe for four to five years.

“In New York and London, pop-up stores are quite common,” says Mr Adrian Chan, co-founder of PopUp Angels, an online platform established in October 2015 that aims to make it easier for retailers to find, rent, and set up pop-up and event spaces.

PopUp Angels

“Instead of being locked in a location, you can pop up at different spaces. By doing that, you can  reach out to different kinds of customers.” - Mr Adrian Chan, co-founder of PopUp Angels

Mr Adrian Chan, co-founder of PopUp Angels (Tony Soh/Epoch Times)

Mr Adrian Chan leads the Singapore team while co-founder, Mr Kit Chan, is behind their operations in Hong Kong. The pair had previously ventured into F&B businesses Best Fries Forever and Cloud & Cream. With their experience in the retail business, they understand the tiring and complex process retailers have to undertake, which could take up to six months, to find short-term spaces.

“So we thought that a platform such as PopUp Angels would be quite helpful to retailers,” reveals Mr Chan.

Aside from searching for spaces, PopUp Angels also guides retailers through the whole process of setting up a pop-up store, such as engaging contractors and sourcing equipment.

“We can link renters to the right vendors and suppliers,” says Mr Chan.

The kind of spaces available at PopUp Angels’ platform varies from a short-term space in a shopping mall or shopping mall atrium, to event spaces or spaces in shop houses.

“Basically, (we provide) any kind of spaces that can be rented on a short-term basis. It can be as short as one day, or three to six months,” explains Mr Chan.

In the same way, the pop-up retail concept could also be a boon to landlords due to rising retail vacancies as a result of the retail slump.

“For the landlord, we make it easier for them to market their spaces to this pool of pop-up retailers.”

According to statistics from Urban Redevelopment Authority, Singapore’s retail vacancy rate rose from 4.5 per cent in 2013 to 5.8 per cent in 2014, and 7.2 per cent in 2015.

“So we thought a platform such as ours would be useful for the market, for both the landlords and renters,” he adds.

The Demand for Pop-Up Stores

In the United States, the ‘retail apocalypse’ has resulted in a soaring number of brick-and-mortar retailers closing their stores or ending up in bankruptcies.

Alex Cohen, a broker with commercial real estate firm Core, told New York Epoch Times on November 2016 that the vacancy rate in SoHo, a neighbourhood in Lower Manhattan, rose from 10 to 20 percent over the last 18 months. The vacancy rate continues to rise, due to difficulties faced by retailers.

“That is driven by the strength of e-commerce, … and the challenges that retailers have faced maintaining profitable stores with very high rents,” said Cohen.

The effect of this ‘retail apocalypse’ has driven retail brands to seek short-term space for a pop-up store to test the market before jumping into business.

In fact, these factors stimulating the shakeout of retail and the rising demand of pop-up stores are not confined to the US. Instead, it is a worldwide phenomenon happening in Singapore and in many other developed countries.

Similar to the US, Singapore’s retail market is undergoing a transformation as a result of high rental, rising retail vacancies, and surging e-commerce.

Although Singapore’s e-commerce is probably less than five percent of the total retail market, compared to 10 percent in the US, this up-and-coming e-commerce trend is escalating and will continue to burgeon in the near future.

To make the matter worse, traditional retailers in Singapore are also incurring high labour costs.

“Many retailers have stopped growing their network of stores, and some have even been shrinking their stores,” says Mr Chan.

Hence, although Singapore was lacking awareness of pop-up stores and their platforms just two years back, a growing number of traditional retailers are switching from long-term space to pop-up stores. With the demand for pop-ups gaining momentum here, PopUp Angels are presently getting more landlords coming on board this platform.

In Hong Kong, conversely, there is more awareness of this pop-up concept as compared to Singapore, and some landlords even dedicate spaces solely for pop-up stores.

“In Hong Kong, the retail vacancies are much more drastic, and the rent rises a lot more.

“We do get all kinds of enquiries from different kind of trades. It’s growing quite rapidly at the moment. There’s still a large number of people who don’t know that there is a platform for pop-up spaces,” he shares, hoping to expand PopUp Angels to other cities in Southeast Asia in the future.

“We see that the trend of pop-up stores will continue. Instead of jumping into a two- to three-year risk, retailers can enter for a few months or even just for a few weeks,” he explains.

Advantages of Pop-Up Stores

For Traditional Retailers

“Pop-up stores give retailers a lot of advantages,” says Mr Chan, who received his Bachelor of Business Administration with High Honors at the University of Texas in 2000.

Firstly, he notes, there is no need for retailers to commit to a long-term space, making the risks and capital requirements much lower.

Secondly, it is a good way to test your market.

“It is a way to see whether there is demand in your market, and you can adjust accordingly,” explains Mr Chan, whose clients include big brands like Chanel, G2000, Sasa, and Columbia Apparel.

“Instead of being locked in a location, you can pop up at different spaces. By doing that, you can  reach out to different kinds of customers.”

Though there is less risk involved, Mr Chan advises retailers to budget a certain amount of time and funds to market the pop-up store in order to gain awareness; also, they should stay focused on who they are targeting and what they want to achieve through the pop-up store. 

“Because if you are popping up for one to three months, you really don’t have time to adjust your objective halfway through,” he points out.

For Online Retailers

According to Mr Chan, if you are an online retailer, having a temporary physical store could act as a stimulus to boost your sales.

“You can reach a different segment too, because there is still a large pool of consumers who will only purchase when they visit the physical store,” he reveals.

In addition, online business owners find the physical space a good platform to interact with their customers and hear their feedback.

“For interesting retail brands that can’t afford to pay the high rental, the pop-up store is one way for them to extend their reach and grow their market aside from the online platform.”

For Landlords

As for landlords who are taking a much longer time to find a long-term tenant, renting their spaces to pop-up stores is a viable option to earn some income, while searching for long-term tenants.

Other than that, Mr Chan says, these pop-up stores “could actually refresh their spaces and help bring in a different crowd into the mall”.

“In Singapore, wherever you go, the malls are the same. The tenants are mostly dominated by the same big brands such as UNIQLO, H&M.”

Hence, having pop-up stores in the mall makes the shopping experience more interesting for shoppers.

“Many landlords are also realising this, so they are changing their tenant mix.”

The Future of Singapore Retail

Mr Chan opines that to strive in the transforming retail market, Singapore retailers need to find ways to invent and create experiences that cannot be achieved through e-commerce, in order to attract customers to visit their brick-and-mortar stores.

Mr Adrian Chan, co-founder of PopUp Angels (Tony Soh/Epoch Times)

“The retail store may not just be a place to sell things. It may be a place to experience the brand, or to connect the customers,” shares Mr Chan, who also founded Roomraider SG—Singapore’s largest escape room gaming centre, which was acquired after just 14 months of business.

For example, the Chanel Coco pop-up café built a relationship with their customers by providing them with personalised services that e-commerce could never attain, such as makeovers, manicures, hand massages, as well as makeup tips from beauty advisors.

“Right now, e-commence is still quite small, but it’s going to continue to grow at a very fast rate. So they need to do things that cannot be achieved through e-commerce,” he says. “It’s not physical versus online. It’s a mix of both.”

He says retailers could utilise more technological tools to enhance their retail businesses and to make the whole shopping process more efficient. In this way, retailers could cut down on the need for retail staff, solving the problem of high labour cost.

“A lot of technologies are emerging to help you run or track the retail store, such as the kind of people coming to your store, the number of people coming to your store,” he explains.

“One way in which places in London and US are more advanced is that their retail is more omnichannel. They combine the online and physical stores very well,” he reveals.

“Singapore is going in this direction.”

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