Why Apple, Sephora, and Nordstrom are jumping on this trend to pull in shoppers

March 9, 2021

How can big chains like Target and Nordstrom keep consumers coming back to their stores during an ongoing pandemic? One go-to strategy is the store-within-a-store concept. It’s a way for one retailer to join forces with another by setting up a pop-up shop within their stores, CNN reports.

Industry analysts say the approach has benefits for both parties. For instance, department store Kohl’s adding as many as 200 Sephora mini shops inside of its stores in 2021 as a way to expand its beauty and cosmetics category. For Sephora, the deal helps the retailer expand its market to Kohl’s shoppers.

Meanwhile, Target is opening mini Apple shops in a handful of its stores as it strives to become a one-stop shop to meet all of its consumers’ needs.

“From Sephora co-locating in Kohl’s, to Apple in Target stores, these collaborations bring complementary customer traffic and added income, especially for the host retailer,” Burt Flickinger III, managing director of Strategic Resource Group recently told CNN. It’s also a way to get shoppers to visit stores more frequently, he said.

“For stores like Kohl’s or Nordstrom, shoppers maybe go once a month or once a quarter. By adding a store-in-a-store, now you can get a Kohl’s shopper returning more often for their beauty and cosmetics needs,” said Flickinger.

Meanwhile, CNN notes, Nordstrom and at-home fitness startup Tonal have teamed up to launch a handful of Tonal mini shops inside Nordstrom stores. The Tonal-branded pop-up stores are debuting this month in 40 Nordstrom locations across 20 states. The 50-square-foot shops will be located in the women’s activewear department. Nordstrom said shoppers can see a demo of the gym or try a workout for themselves.

And Ulta Beauty is debuting its mini cosmetics shops inside of Target stores in 2021. As with Sephora’s mini shops in Kohl’s, this deal is expected to help Ulta— which sells a mix of drugstore beauty and pricey brands that aren’t normally found in big box stores—to reach younger and more budget-conscious consumers.

For Target, it expands the retailer’s growing beauty business with new brands it didn’t carry before. The 1,000 square-foot mini shops will initially launch in 100 Target locations and on Target.com, and then ramping up to several hundred Target stores.

Research contact: @CNN