The pros and pitfalls of pop-up shops

Figurniy Sergey/Zoonar via Alamy

• Cost-effective for brands
• Add to shopping ‘experience’
• Could damage larger brands

Pop-up shops are appearing in more shopping malls, hotels and even beach clubs.

Whether they are for new brands looking to build a name or more established companies opting for a more experiential way to market and test their products, pop-ups are largely temporary affairs designed to create a buzz.

They are also considered a more cost-effective alternative to leasing space in stores or malls.

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Dyson is the latest to offer up an “immersive pop-up installation” at Dubai’s Mall of the Emirates, which many local and international companies have chosen as a temporary selling location.

A survey by Google in 2022 found that, of the brands that had experimented with pop-up shops, 46 percent reported an increase in sales, 51 percent a rise in market visibility, 66 percent saw greater brand awareness and 46 percent a spike in social media engagement.

However, retail industry experts have differing views on how successful a pop-up strategy can be.

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“We’ve seen a lot of brands pulling out from classic department stores like Bloomingdale’s and Debenhams and trying to go into their own standing format,” says Simon Hacker, CEO at Alpha Nero, a Dubai retail design and production company.

“You can buy from pretty much anywhere but the shopping itself tends to appeal to an experience and this is what brands want to offer,” he says.

Yet Sima Ganwani Ved, chairwoman of Apparel Group, says a pop-up strategy could end up being damaging to certain brands. 

“If you’re a very well known name and you do a pop-up simply because there is no more real estate to offer to you, then that’s a whole different strategy,” she says. 

“But if you’re doing it as a testing ground and you continue to do it, malls will not take you seriously and they’re not going to offer you any premium real estate.”

Room for department stores

Sandeep Ganediwalla, partner for the Middle East and Africa at Redseer Consulting, says that there is “still a place for departmental stores, especially for planned buying and getting multiple products at a single place”.

“Pop-ups are more of an engagement tool for larger brands to keep them directly connected with consumers,” he says.

Footfall across the UAE’s shopping malls in 2023 was up 11 percent year on year, the latest State of the UAE Retail Economy report by Majid Al Futtaim shows.

Both Simon Hacker and Sima Ganwani Ved will be guest panellists at this year’s Retail Summit, which is being held on April 23 and 24 at Atlantis The Palm, Dubai.