To pop-up or not to pop-up: this is a good question to consider if you’re thinking of starting a business, and want to test the waters before making a full commitment.
It’s not easy to start a business that generates long-term interest beyond the initial concept. Opting to launch a business by first organizing a pop-up shop can be a sensible way to feel things out on the short-term, and at a lesser cost.
And, in some cases, that pop-up might be just the thing that attracts the big investment dollars and proves that your idea can garner big interest. It also can be a way to bring fixed costs down, sell your product in advance, and figure out your profit margins before opening day.
Hamlet Tallaj of Hamlet’s Vintage, a vintage clothing shop in New York, started his business first as a pop-up three years ago. The response for his short-term endeavor was so successful that he decided to open a full-on storefront.
Today, his business is still running strong.“I was going to be open only for the holiday for a month,” says Tallaj. “But business was really good, and I decided to stay for four months. After that, I decided to open permanently and change locations.”
"It was a bold decision for me,” he continues. “Pop-up shops weren’t around three years ago, so it was harder to present the idea. Now in this economy it is easier, but you need to have a good background in merchandising and finance for it to really last.”
If you’re thinking of producing a pop-up of your own, here are a few you should consider in figuring out what will really pop.
Advertise to any already-built-in clientele.
“I already had a lot of followers because I’ve always bought and sold vintage clothing all around the country,” says Tallaj. “I let people know where I was going to be doing the project and when it would happen.”
In the case of NYC restaurant pop-up extraordinaire Alan Philips, it’s all about creating a culinary experience. With several pop up events behind him, Philips already has followers raring to check out his next endeavor, so pre-selling via the Internet and his blog, Cocktail Hour, goes off swiftly.“We are conservative in how often we use social media and new media now,” says Philips on how he makes sure to keep people interested. “We don’t send a message out ever unless we have something to say.”
Find a genius location.
Having the best location is the most important factor -- especially if you don’t already have a built-in clientele. With a good location, a pop-up may not need to hire a PR or marketing firm because the location will garner visibility and traffic simply based on its proximity to all the action.“You have to think about location and traffic when you put up a pop-up,” says Tallaj. “Getting a good deal on a side street isn’t going to be good, because then you will have to invest in advertisements. Your market is all that traffic that goes by your business. That is your best opportunity.”
"There is a tremendous amount of vacant space in New York and other cities affected by the economy,” says Philips. “Those vacant spaces are good for testing the marketplace and testing concepts.”
Listen to your customers.
Your pop-up is up for a limited time, so really stop and make sure you know how the customers coming by feel about what you’re selling. Philips maintains a database of all of his clients who have ever come through one of his restaurant endeavors. He hires a staff to discuss feedback. He pays attention to his relationships with the hotel and event spaces that he partners with. And he always sends out personalized email thank you notes as well.
Know your limitations.
Philips’ pop-ups are seasonal. November and December are super busy times so ideal for a pop-up restaurant. July, August, January and February are low demand times.“We don’t open when there is no demand,” says Philips. “We’re able to be mindful that Monday isn’t as big as Saturday.”
Determine whether it’s the pop-up experience, or the product (or both).
Even if an idea works tremendously as a pop-up, that doesn’t mean it’s going to work as a full-on business in the long run. Yes, the pop-up concept is incredibly popular at the moment: large and small businesses have enjoyed great success in one-off and limited time experiences. The public loves the novelty – and the exclusivity – that comes with the pop-up.
With that understanding, a smart business person should a step back to figure out if people truly love the products and would buy the product or service all the time, or if it’s more about the experience.“A lot of times, they really just like what you’re creating because they have access for a limited period of time,” says Philips. “With some concepts I can bring in 1,000 people one time, but I can’t guarantee that they come back again and again. Most people are willing to try something once.”