Pop-ups — shopping outlets that appear, trade temporarily for anything from a week to a year, and just as quickly disappear — will account for a significant third of new businesses this year.
And, as well as often being a test-bed for more permanent ventures, pop-ups are also proving to be financially viable in their own right, with a CEBR and EE study revealing that pop-up retail contributed £2.1 billion to the UK economy alone in 2015.
It’s a retail approach that was identified as far back as 2004, began to gain real traction during the global economic downturn and has continued to gain momentum ever since. Brands big and small are jumping on the pop-up bandwagon, from electronics giant Samsung, to cycling brand Rapha and Fast Company’s most innovative brand Warby Parker.
The movement began as a marketing quirk but the benefits quickly became obvious; the quick set up and speedy breakdown allows retailers to test new concepts, jump on trends and move with the seasons, whilst avoiding having to service long term leases during low seasons.
This flexibility allows retailers to experiment and take risks – Samsung launched its first pop-up in 2013 as an experiment which led to the opening of 60 permanent stores in Europe alone by the end of 2014. Similarly Rapha’s coffee shop and bike shop approach was created as a temporary marketing activity but its success has nudged Rapha from being an online only brand into adopting a programme of bricks and mortar openings.
For as long as retailers have been discovering the virtues of pop-up shops on the high street, similarly elastic approaches to online retail have been made possible through innovations in IT, particularly cloud computing.
Whilst some benefits of cloud have been incorporated, and indeed made new online retailing models possible – Amazon Web Services began life powering and providing elasticity to Amazon.com – there is a far larger opportunity for online retailers to act like pop-ups and reap major benefits.
While any online retailer has long built its ecommerce platforms on public clouds to take advantage of their elastic capacity, ready for seasonal and sale-led surges in traffic, the wider functionality of their sites is usually permanent and often purpose built, from retail assistance, to CDN set ups, and security.
This has given online retailers the ability to change the features of their site quickly and cope with surges in traffic, but the instant on/off and the lowered risk of the pop-up hasn’t quite been available to them. However, it can be.
Pop-up as a service
An online pop-up site that appears for a day (say, for example, Black Friday) and is gone the next riding seasonal trends, holidays, fads, or even a time of day is now eminently achievable through Everything as a Service (XaaS) offerings such as those delivered by Tata Communications, which can provide everything you need from the fastest connectivity, to your CDN, to call centre set up, network security hosting, and retail assistance, as a service – instantly on demand.
Imagine a pop-up website that sourced products and experiences from multiple retailers such as florists, card stores, perfumeries, premium food and drink producers, restaurants and event organisers, to offer a full assortment of romantic gifts one month before Valentine’s Day.
It would save the hassle for busy romancers having to buy their loved ones a card from here, flowers from there and a nice bottle of wine from somewhere else and by conglomerating all the top-performing Valentine’s Day product lines in one place would be a fast, easy price-comparison method.
It’s simple to set up, without lock in, and low risk. An environment perfect for the experimental approaches to trading that the retail and ecommerce powerhouses, as well as adventurous start-ups, have long embraced. Partnering with a single service provider means that whether it’s a pop-up that runs for a month and then disappears, or one that grows into the next Alibaba, it’s all seamlessly possible.
And remember, Tata Communications provides connectivity for perhaps the biggest pop-up of all – every Grand Prix race where we set up a 1GB network for three days, in 19 countries around the world and sometimes on back-to-back weekends.
With pop-up stores now a multi-billion pound industry, and given the blurring lines between the offline and online retail worlds, the next big trend in the online retail space could well be the online pop-up. With that in mind, the term “pop-up as a service” may not seem as far-fetched as you first thought.
Check out my previous blog on technology demands of the future.