Stores-within-stores could be the new consumer attraction

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Stores-within-stores could be the new consumer attraction

The Etsy pop-up store at Macy's Herald Square

Retailers realize they must create compelling reasons to tear shoppers away from the convenience of buying online to come out and visit their bricks-and-mortar stores. And retailers have found that one of their most effective options for increasing customer engagement is the store-within-a-store (SWAS) strategy, according to Kevin Marschall, vice president of Retail Partnerships at CBRE and its store-within-a-store practice leader for the United States.

In this model, a retailer invites a specialty retailer to set up a shop inside its store in exchange for a share of the guest retailer’s revenue. Done well, store-within-a-store is the proverbial win-win situation, according to Marschall in an article he wrote for Chain Store Age, Store Brands’ sister publication. The host retailer reduces payroll and unproductive inventory while extracting value from under-monetized floor space. Halo benefits for the host include an enhanced brand image, an energized store environment and increased customer draw.

Finding a SWAS partner that shares a synergistic customer profile with the host is one of the most important considerations, Marschall writes. If the customer demographic and behavioral attributes of the host and specialty retailer are identical, the partnership is likely to thrive. If they are askew, however, the venture is destined for failure.

To read Marschall’s article, click here.

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