Why Malls and Pop-Ups Are a Match Made in Heaven

The speed at which e-commerce and the pop-up movement (which includes farmers markets, food trucks, pop-up shops, pop-up restaurants, supper clubs, etc.) are advancing is testing the nimbleness of not only brands, but also of the shopping malls that have served as their primary sales outlets. The malls are trying to figure out their relevance and how to adjust to the new shopping trends, and are facing the unenviable task of trying to keep pace while having to think ahead.

The fact is that so many of the retailers typically thought of as mall “anchors” are either failing or shrinking in size — Sears, Macy’s, J.C. Penney, and Staples, just for starters. Then you have the designers and niche retailers that are also finding that competitive forces are forcing them to shrink their networks, if not close altogether. And what can be more depressing than walking by inline window signs that say “Opportunity to Lease” while shopping at a mall. There is a quick connotation that the mall is beginning to lose its buzz.

What mall executives are finding, though, is that there is a solution at the ready — pop-ups. After stiff-arming the idea of hosting pop-up tenants for many years, pop-ups are suddenly becoming the “in” thing for malls, even upscale ones that are doing quite well. There are a number of reasons for this sudden change of heart.

For one thing, pop-ups have become an integral part in the omnichannel movement, especially for online-only retailers who are looking to create experiential shopping events for their customers. For another, rather than having a space vacant for even a few months in between permanent tenants, pop-ups can serve to “stage” a storefront, communicating the idea that this space is very much vibrant and a worthy venue to be rented.

And lastly, there is money to be made. Incremental rent is better than no rent at all, mall operators have realized. Adding to that is a move to host and monetize pop-up events in otherwise non-revenue-producing parking lots and common areas.

So for shopping malls, pop-ups now represent a new, profitable class of lessees. And how about for pop-up merchants — are malls a good fit?

Actually, for many, malls are ideal venues for pop-up shops. One thing that malls offer that many self-standing storefronts don’t is a captive audience of people in the mood to shop! Not just a few, but in many malls, a week-long pop-up is liable to witness many tens of thousands shoppers walking by its store. With one of the main challenges for a pop-up being the lack of prior foot traffic and the difficulty in getting the word out about the pop-up’s launch, this problem is basically solved by the mall’s regular clientele.

Malls are also a great turnkey option. Spaces are clean, there is air-conditioning, security, maintenance, and the all-important parking that are all part of the package.

For these reasons, our conclusion is that pop-up shops and shopping malls are in many ways perfect matches. For the mall, pop-ups represent a revenue generator that will benefit from the increase in e-commerce, rather than suffer from it. And for pop-ups, shopping centers will provide a perfect, ready-to-go setting for