Crumpler tests the market with pop-up stores

Melbourne-based bag retailer Crumpler has adopted a strategy of launching three- to nine-month pop-ups to test potential locations before committing to new store sites.  

“It’s a great opportunity to test the market, and there are a lot more pop-ups around in the retail market, so landlords are more open to them now,” Adam Wilkinson, Crumpler’s chief executive, told Inside Retail Weekly.

“We get a lot of invites to look at sites – there are some great ones available.”

Crumpler has opened two new pop-ups in the last month – on Swanston Street in Melbourne and Broadway in Sydney – and while their footprints are smaller than a typical Crumpler store, they are trading to expectations, according to Wilkinson.

The retailer also recently opened two full-size stores in Spencer Street Mall in Melbourne and Market City in Sydney after proving the market through successful pop-ups.

“We realised they were areas that work for us. We’re looking at pop-ups being the first part of a store strategy in terms of finding the right location for us,” he said.

Part of the reasoning behind Crumpler’s new approach is an aversion to commit to longer leases in a struggling domestic retail market, Wilkinson said, with landlords remaining bullish on rent, forcing many retailers to push discounts in order to stimulate demand.

“We’re still getting growth, but Australian retail is tough – especially when we look at our Southeast Asian business where growth rates are significantly higher,” Wilkinson said.

“It’s a similar model and footprint, but our Asian retail business, which is our own stores in Singapore and Malaysia, has seen a 28 per cent growth year-on-year. Excluding wholesale and online, our Australian business is sitting at 4.5 per cent growth on last year.

“For us, we see ourselves as a relatively niche brand, and we think we’re close to maturity in the Australian market in terms of retail doors. We’re very close to the peak of where we see it in Australia.”

Crumpler recently opened its first permanent store in the Philippines in Manila and will launch a second by the end of the week. It is also eyeing further stores in Malaysia and Singapore as part of a larger international growth strategy that could encompass Korea, Japan and Thailand in the near future, according to Wilkinson.  

This doesn’t mean Crumpler is no longer investing in the Australian business. In fact, it just implemented click-and-collect across 17 of its stores, making the offer available in almost every state.

“We had a lot of customer feedback from surveys [and] overwhelmingly they were asking for it,” Wilkinson said.

Customers said they wanted to be able to secure the product online, but head in-store to talk through the functionality of the bag or luggage with a salesperson before commiting to a purchase.

Travel luggage heats up online

Crumpler’s online sales are growing faster than its bricks-and-mortar business, at a rate of about 15 per cent on last year according to Wilkinson. But competition is growing in the luggage space, with direct-to-consumer player July entering the market recently with backing from Strandbags.

“We’ve noticed there is definitely more online-focused businesses coming up and playing the space, and potentially taking some market share,” Wilkinson said.

“We haven’t seen a drop in our hard case luggage sales, which is encouraging, but it is out there. I think that for us as a brand, we’ve remained true to our roots. While we’ve launched a hard case luggage brand, our focus is on making sure it has a unique design aesthetic.

“We know there are other players out there, especially in the tech space, but we want to stay true to the collection and the rest of the product range.”

Additional reporting by Jo-Anne Hui-Miller

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