As I highlighted in the “Emerging Retailing Models in Licensing: Pop-up Stores” opinion piece previously, pop-up shop format works well in the licensing industry. They can act as billboards for the franchise, enabling licensors to communicate the brand story directly with consumers. Recently, increasing number of business have been experimenting with the model by opening outlets at cinemas and live shows using it to communicate their lifestyle license image with fans. There has even been an example of a rather unusual permanent pop-up shop launch thanks to a new collaboration with the world’s largest licensor and an electronics retailer, as unlikely as that may sound to many.
Pop-ups: An ideal channel in theatres and shows
By opening a pop-up shop at cinemas as well as licensed shows such as Frozen on Ice or Harry Potter – The Cursed Child in London’s West End, licensors can tap into a captive audience who are already interested in – or even better a fan of – that particular franchise. Film or performance-attending consumers would undoubtedly be much more inclined to spend on tie-in licensed merchandise, and are likely to want to take part of that experience and excitement back home, more than any other segment that a licensor or retailer targets through generic marketing activities.
In terms of film launches, six weeks around the film launch (three weeks before and three weeks after) is absolutely vital for licensing businesses. In order to capitalise on the film’s impact, pop-up stores have been increasingly leveraged by licensors. In Summer 2016, The Araca Group partnered with Disney’s Marvel Entertainment to launch 88 pop-up stores in cinemas showing Captain America: Civil War in the US. The stores featured limited-time exclusive collections that included t-shirts, custom sweatshirts and hats.
In 2016, Warner Bros. Consumer Products, on behalf of DC Entertainment, also collaborated with The Araca Group for pop-ups on the opening night of the film Suicide Squad in more than 50 cinemas in the US. The shop included a wide range of licensed merchandise based on the film and its characters.
Opening pop-ups in cinemas is not a trend which is confined to developed countries. For example, Disney Turkey opened pop-up stores in cinemas where its films are shown while also experimenting with the overall pop-up format dedicated to its Finding Dory franchise throughout 2016.
Pop-up stores could offer a lifeline to lifestyle licensing
As for licences that aspire to be lifestyle franchises, pop-up platforms could potentially offer an ideal way to reach consumers, helping to overcome prospective difficulties in getting shelf space in established retailing channels.
Coca-Cola is the world’s 50th largest licensor, with total retail sales of licensed merchandise standing at US$1 billion in 2016 according to Global Licence! Top 150 Global Licensors 2017 study. One of the key targets of the company is to increase this revenue while becoming a true lifestyle franchise. In order to achieve that as part of its larger strategy, the company has been experimenting with the pop-up format rather actively, opening stores in Tokyo, Talinn, Bucharest and Sofia.
Owned by Mars Retail Group, M&M’S World opened a pop-up store in New York City’s SoHo neighbourhood in July 2015, aiming to capitalise on the busy summer tourist season offering a variety of licensed apparel and homeware products. According to Global Licence! Top 150 Global Licensors 2017 report, Mars Retail Group’s revenue from total retail sales of licensed merchandise stood at US$340 million in 2016.
Pokémon, one of the biggest licensors globally, opened a pop-up store in London in August 2016 at the height of the Pokémon Go computer game craze, while American celebrity Kanye West launched a pop-up retail event across 21 cities worldwide in the same year. Kanye West’s global event featured a range of West’s Pablo merchandise, exclusive to the stores, including t-shirts, jackets, hats and sweatshirts. Each pop-up store also included limited edition designs unique to that city. Back in 2012 and 2013, One Direction, English-Irish pop boy band, opened around 28 pop-up stores worldwide featuring their licensed t-shirts, phone cases and caps.
Pop-up but permanent: The next generation pop-up?
In 2016, Disney partnered with TeknoSA in Turkey, one of the leading electronics retailers in the country, to open up a 100-150 sq m permanent Disney sections in TeknoSA’s 80 outlets across 31 cities. Disney does not have Disney stores in operation in Turkey. Yet, with this new, eyebrow-raising collaboration immediately found a retail platform to sell more than 300 Disney Collection merchandise items across the country.
This is certainly an interesting combination and arguably it is a win-win situation for both. It was highlighted that with this collaboration Disney aims to tap into TeknoSA’s mid to high income consumer segment, while TeknoSA intends to expand its consumer base to include more families. Is this the winning formula or the next frontier in the world of pop-ups? 2017 is a crucial year watched closely by many that will tell whether the gamble will pay off. Nevertheless, it is certainly a very interesting example where Disney overcomes the difficulties in a geography posed by not operating its own stores. Its new strategy certainly helps the company to communicate its “ story-telling” and “360 degree retailing” retail strategies directly with consumers.