An Empirical Investigation into Millennials and their Buying Behaviour within Pop-Up Retail Stores

Reabetswe Kekana¹, Marike Venter de Villiers², Annekee van den Berg³, Tinashe Chuchu⁴

Abstract: Multi-channel retailing has become increasingly popular as retailers aim to provide consumers with additional contact points. This is commonly done by means of pop-up retailing, an innovative retail concept that places significant emphasis on creating a unique in-store experience. Although a number of studies have been conducted on this topic, limited research is available on the factors that influence purchase intention in pop-up retail stores among Millennials, especially with regard to fashion products. This article investigates the influence of perceived store uniqueness, store atmosphere and product assortment on purchase intention, and the mediating effect of brand experience on the relationship between the predictor variables and purchase intention among Millennials in Johannesburg. By means of a quantitative study, 208 responses were collected in the form of self-administered questionnaires. Four proposed hypotheses were tested through structural equation modeling. The results revealed that all four hypotheses are significant, and that brand experience partially mediates the relationship between the predictor variables and purchase intention. The results provide retailers and marketing practitioners with insight into how the concept of pop-up retail stores can be utilised to maximise the brand experience and influence buying behaviour among Millennials. It consequently sheds light on the importance of creating a unique brand experience through pop-up retail as a channel to reach prospective customers. The main recommendation from the findings is, therefore, to ensure that the store atmosphere is uniquely tailored for the intended audience so as to result in positive brand experience which allows for positive word-of-mouth to be spread to prospective shoppers.

Keywords: Multi-channel; fashion; pop-up retail; millennial; brand experience

JEL Classification: M1; M3

1. Introduction

Against the backdrop of the current competitive retail landscape, many retailers have initiated multi-channel retail strategies to increase customer touch points (Verhoef, Kannan & Inman, 2015). Multi-channel retailing comprises the strategic decision whereby a retailer distributes their products through more than one channel (Stone, Hobbs & Khaleeli, 2002). This is often done by means of ‘pop-up retailing’, a novel retail concept that has recently gained importance in the field of marketing and brand management (Haas & Schmidt, 2016). In essence, pop-up retailing refers to a temporary venue that is used as a space for selling products (Retief, 2012). Companies use pop-up retailing by implementing creative ways to stimulate demand and to create favourable brand images amongst customers (Kastner, 2015). Pop-up retailing was introduced in 2003 in a global context, and first appeared in South Africa in 2008 (Retief, 2012). The purpose of this study is to investigate the Millennials buying behaviour from pop-up stores from a South African perspective. In doing so, the influence of (perceived store uniqueness, store atmosphere and product assortment) on brand experience is measured. Furthermore, the impact of brand experience with pop-up stores on purchase intention of product of pop-stores is also measured. The present study focuses on Millennials are also known as Generation Y.

According to Richard K. Miller and Associates (2011) and Gurau (2012), Millennials are individuals born between 1980 and 2000. Millennials, as a cohort, are the largest consumer group and are three times larger than their predecessor, Generation X (Belleau, Summers, Xu & Pinel, 2007; Ordun, 2015). Millennials are distinguished from other generations by their knowledge, use and appreciation of technology which has allowed them to create their own eco-system online (Ordun, 2015). Moore (2015) found that Millennials have the highest likelihood of posting on Twitter about the brands they follow. Millennials are driven by the need for reciprocity between themselves and marketers through engagement, trust, sincerity and mutual respect which lead to their satisfaction and repatronage (Barton, Koslow & Beauchamp, 2014; Nichols, Raska & Flint, 2015). They are also believed to have an annual spending power of at least $600 billion (Donnelly & Scaff, 2013; Nichols et al.; 2015). Pop up stores are valued at $50 billion in the United States (US) (Bose, 2017), and accounting for about 0. 76% in total retail turnover in the United Kingdom (UK) (Stevens, 2017), the pop-up retail industry is fast becoming an established phenomenon in the retail sector (Cradlepoint Technology, 2012).

Within a South African context Millennials are key consumers in that they are increasingly they are progressively becoming economically active and are spending more money (Vannevel, 2016). In South Africa, Millennials have at least 55% control over their spending and 20% of advertising budgets are directed towards them (Chikanda, 2019). Furthermore, Chikanda (2019), adds that Millennials in South Africa spend about R44. 6-billion. The Millennials cohort in South Africa is quite substantive as it accounts for 25% of all residents in the country (Duffett, 2015; Statistics South Africa, 2012). Media reports have stated that, Millennials in South Africa have strong status consumption tendencies (Bevan-Dye, Garnett & de Klerk, 2012). It is therefore relevant and expected for the present study to select South Africa as one of the emerging economies, because in Africa, the South African economy is one of the two largest economies, the other one being Nigeria (Balogun & Seeni, 2018; Lappeman, Egan & Coppin, 2020). Popular cases of pop-up stores in South Africa, include the Magnum store that ‘popped up’ in Johannesburg and offered consumers a contemporary, luxurious space where consumers could explore tastes and textures of Magnum ice cream (Bizcommunity, 2018). More specifically, in the fashion industry, The Space used a pop-up shop as an extension to South African Menswear Week in 2018 (Bizcommunity, 2018).

Research on pop-up stores from South African perspective, includes Retief (2012) who looked at young South African consumers impulse intentions towards visiting pop up stores. Retief (2012), established that traits of innovation (relative advantage, triability, observability, low complexity and compatibility) influence South African consumers’ impulse intention to visit pop-up stores. South African consumers’ impulse intention to visit pop-up stores is also influenced by both an external factor (exterior store design) and internal factors (emotions, desire for pleasure and consumer innovativeness) (Retief, 2012). Pop-up stores are a novel way for South African entrepreneurs as they allow them to test ideas, build brands and make sales without the expenses normally associated with permanent retail structures (Female Entrepreneurs SA, 2020).

This research is expected to have contribution that is two-fold, first theoretical then practical. In terms of the theoretical contribution of this research, a unique conceptual model was proposed. The model presents proposes predictor variables (perceived store uniqueness, store atmosphere and product assortment), a mediator variable (brand experience) and an outcome variable (purchase intention). This model explain the extent to which the first predictor variable (perceived store uniqueness) influences brand experience of South African millennials with pop-up stores. In addition, the conceptual model explains how the other predictors, (store atmosphere and product assortment) impact brand experience of South African millennials with pop-up stores. Furthermore, this research, shows the mediating effect of brand experiences between the predictors and the outcome. Last, the study’s proposed conceptual model explains the impact that brand experience has on South African millennials’ purchase intention of products from pop-up stores.

1.1. Motivation and Problem Statement

The present research looks at pop-up retailing which is an area highlighted by de Lassus and Freire (2014) as under-researched. Considering that the present study focuses on the millennial cohort, it was imperative to investigate an industry closely associated with this group. According to Valaei and Nikhashemi (2017), Millennial shoppers are an indispensable generation cohort when it comes to design or fashion related purchases. Millennials, who are undoubtedly passionate about fashion, possess significant purchasing power (Maziriri, Chuchu & Madinga (2019). The Millennial cohort is considered to be a profitable cohort and a key target audience for retailers and consumer product firms alike due to its magnitude and substantial buying power (Parment, 2013). It could therefore be suggested that Millennial consumers present noteworthy potential for marketers and retailers, thus motivating the need for an in-depth comprehension of their purchase behaviour. However, the challenge and problem presented to marketers with understanding the Millennial cohort fully stems from the fact that they are less gullible, implying that they need more conviencing as compared to older consumers in order to purchase products (Ladhari, Gonthier & Lajante, 2019). This study therefore provides a unique perspective of pop-up stores from the Millennial consumers’ point of view, continuing the discussion on how best the Millennial cohort can be captured?

2. Literature Review

2.1. Pop-up Retail

Pop-up stores are basically short-term retail outlet that generally appear annually before Christmas which sell cards, paper and gifts (Female Entrepreneurs SA, 2020). Pop-up retailing originated in London in 1999 with Levi’s and Swatch, and has since become widely popular across Europe, Asia and the Americas (de Lassus & Freire, 2014). Furthermore, de Lassus and Freire (2014) noted that retail pop-ups create an event that attracts media attention and evokes the interest of consumers. Dating as far back as 2003, pop-up stores started to receive attention from marketers due to their increased popularity, thus becoming a growing trend (Burgess, 2012; Gregory, 2009; Kingston, 2006). These pop-up stores are sometimes referred to as “seasonal” or “temporary” retailers, designed to test markets for limited periods or to create hype for new brands or products (Burgess, 2012). Other scholars, such as Warnaby and Shi (2018), refer to pop-up stores as “flash”, “temporary” or “guerrilla retailers” which facilitate direct, experientially-focused customer-brand engagement over a trial period. Warnaby and Shi (2018) add that this form of retailing has become more common and has been adopted widely in the commercial environment, ranging from shops to bars, restaurants, cinemas, as well as art galleries. Pop-up stores support their parent luxury fashion houses in that they create an emotional attachment with the consumer, as well as a playful atmosphere, at the same time, promoting the brand’s image (de Lassus & Freire, 2014). Within an emerging market such as South Africa, pop-up stores have increased in popularity among young entrepreneurs who are using the concept to promote and sell their brands prior to moving to more permanent stores. (Hamilton, 2020). The question which remains is, will this business model work? The following section discusses “the millennial consumer”, the key target audience for the research.

2.2. The Millennial Consumer

Millennial individuals, also known as Echo-boomers were born between 1980 and 2000 (Aliman, Ariffin & Hashim, 2018; Parment, 2013; Gurau, 2012). Millennials are described as individualistic, well-informed, more technologically knowledgeable than previous generations (Ladhari, Gonthier & Lajante, 2019; Valentine & Powers, 2013). Millennials is a market segment with considerable purchasing power, therefore making it an essential consumer cohort (this has not been clearly validated up until this point. Be careful to make sweeping statements without validation to the reader0 (Valaei & Nikhashemi, 2017). Although several definitions exist on the millennial cohort, they are generally considered to be between the ages of 18 and 35 years (Howe & Strauss, 2000). The Millennials’ buying power has increased significantly in recent years (Howe & Strauss, 2000; Martin & Turley, 2004), making them an important market segment for companies to consider (Hill & Lee, 2012; Pomarici & Vecchio, 2014). Within a South African context, Millennials represent 27% or 14 million consumers of the South African population (GFK, 2017). Despite their reputation of being a lucrative market segment, their buying behaviour and motivations tend to be unpredictable (Solka, Jackson & Lee, 2011). They are regarded as impulsive buyers with a desire to stay on track with the latest fashion trends and styles (Noble et al.; 2008; Viswanathan & Jain, 2013). The expression ‘hot today, boring tomorrow’ (Yarrow & O’Donnell, 2009, p. 43), accurately describes Millennials’ interest in fashion products. They are expressive individuals who wear whatever they want, and they tend to carefully balance their desire for being part of a group while maintaining unique, individual identities (Noble et al.; 2008). In South Africa, a study by GFK (2017) revealed that 65% of Millennials agreed that experiences are more important than possessions and they expect brands to provide them with a memorable experience.

2.3. Constructs of the Conceptual Model

This section provides a review of the constructs of the research model, namely; perceived store uniqueness, store atmosphere, product assortment, brand experience and purchase intention. The first construct, perceived store uniqueness, is the view that a store has a competitive advantage which differentiates it from other stores within the same category (Ray & Chiagouris, 2009). It was imperative to explore perceived store uniqueness of pop-stores as these stores are a recent approach to retailing in South Africa. In addition, Ray and Chiagouris (2009) suggested that positioning stores as unique brands different from other stores is crucial in the modern consumption culture. The uniqueness of a store influences perceptions toward the store’s apparel product attributes (Park & Yoo, 2012). The second construct is store atmosphere. As consumers consider the uniqueness of a store, it is also expected that they would consider the atmosphere surrounding that store. Store atmosphere was described by Hussain and Ali (2015) as a list of factors, namely, temperature, music, scent, cleanliness, lighting, colour, display/layout of a store. Store atmosphere influences emotions and purchasing habits of shoppers (Spence, Puccinelli, Grewal & Roggeveen, 2014; Yasin, Sultan, Nazam, Akash, Hashim & Ahmad, 2019). It was therefore important to include store atmosphere of pop-up stores as a construct for the study considering that store atmosphere design plays a very essential part in retailing (Yasin et al.; 2019).

The third construct, product assortment, refers to the range of product choices provided to consumers (Wu & Chen, 2019). Product assortment is concerned with answering three questions, (1) How do consumers perceive the assortment of items in a range of choices? (2) How do consumers choose an item from a given variety of choices? and (3) How do consumers make choices among assortments? (Chernev, 2012). According to Hamilton and Chernev (2012), consumers might prefer wider options as they believe that selecting from more alternatives increases the feeling of having freedom of choice. The fourth construct, brand experience, pertains to sensations, emotions, cognitions, and behavioural responses triggered by brands (Brakus, Schmitt & Zarantonello, 2009; Iglesias, Singh & Batista-Foguet, 2011). In addition, Brakus et al. (2009) suggested that brand experience is a result of stimuli, forming elements of a brand’s design and identity, packaging, messaging and environment. Iglesias et al. (2011) postulated that brand experience is an antecedent of both brand loyalty and affective commitment. Brand experience was included in the study as it is considered necessary for strengthening brand-customer loyalty (Brakus, Schmitt, Zarantonello, Lia, 2009; Zogaj, Olk & Tscheulin, 2019). Increased brand-customer loyalty could possibly have a positive influence on purchase intention in pop-stores.

Brand experience could either lead to harmonious passion or obsessive passion depending on the individual (Das, Agarwal, Malhotra, & Varshneya, 2019). In addition, brand experience can also act as a predictor of brand commitment (Das et al.; 2019). The last construct, purchase intention, refers to the likelihood that a consumer would consciously decide or is prepared to buy a certain product or pay for a service in the future (Martins, Costa, Oliveira, Gonçalves & Branco, 2019; Wu, Yeh, & Hsiao, 2011). The selection of purchase intention in terms of pop-up stores as the outcome variable was necessary because its relationship with store atmosphere can inform retailers on how to formulate the best in-store strategies (Gillani, 2012). These strategies include, how to improve word of mouth and profit margins (Gillani, 2012).

2.4. Theoretical Framework

The theory underlying the present study is Mehrabian and Russel’s (1974) stimulus-organism-response (SOR) model. The SOR model proposes that a stimulus, or environmental stimuli, influence an organism’s emotional state, resulting in an approach or avoidance response. Environmental stimuli refer to marketing mix attributes, such as music, store displays, product assortment and employees, all of which create a sense of pleasure, arousal or dominance among customers. This emotional state directly influences the customer’s decision to buy (approach) or refrain from buying (avoid) a certain product. The application of the SOR model to fashion marketing studies has produced significant evidence. The last finding indicates that fashion behaviour is largely influenced by emotional and psychological stimuli (Jackson & Shaw, 2009; Kang & Park-Poaps, 2010). Given the nature of the current study, the ‘stimulus’ refers to the retail environment, with a specific focus on perceived store uniqueness, store atmosphere and product assortment, with brand experience representing the customer’s (organism’s) emotional state, and purchase intention acting as the response variable.

2.5. Conceptual Model and Hypotheses Development

By means of a conceptual model, the present article tests the proposed hypothesised relationships (see Figure 1). This model proposes that perceived store uniqueness, store atmosphere and product assortment (predictor variables) positively influences purchase intention (outcome variable), while brand experience mediates the relationship between the predictor variables and purchase intention of fashion products in pop-up stores.

Figure 1. Multi-Channel Retailing Model

3. Hypotheses Development

3.1. Perceived Store Uniqueness and Brand Experience

According to Klein, Falk, Esch and Gloukhovtsev (2016), store uniqueness directly leads to positive brand experience for the consumer. This brand experience directly feeds into word-of-mouth (Klein et al.; 2016). This then suggests that a poor/undesirable brand experience will lead to negative word-of-mouth and an enjoyable brand experience will lead to positive word-of-mouth being spread. In other studies related to store uniqueness, Hyun & Park (2015) and Hwang & Hyun (2015) also looked at uniqueness and experience, with the former looking at unique restaurant experiences and the latter looking at uniqueness and experience on luxury cruises. Perceived uniqueness influences consumer attitudes and ultimately the perceptions of status (Hwang & Hyun, 2017). Based on the literature provided, the following hypothesis was proposed.

H1: Perceived store uniqueness positively influences brand experience

3.2. Store Atmosphere and Brand Experience

The second hypothesis proposes that store atmosphere influences brand experience. The temperature, music, scent, cleanliness, lighting, colour, display or layout of a store, collectively known as store atmosphere, directly leads to purchase intention (Hussain & Ali, 2015). This purchase intention is possibly as a result of the consumers’ experience with the brand. Considering a number of previous studies that have investigated this relationship (Beverland, Lim, Morrison & Terziovski, 2006; Holmqvist & Lunardo, 2015; Kamaladevi, 2009; Kumar & Kim, 2014), the findings provide evidence that store environment and atmosphere significantly influence the consumers’ brand experience. Ray and Chiagouris (2009) postulated that store uniqueness is believed to lead to more positive store influence on the customer. Thus, stemming from the abovementioned literature, the following hypothesis was proposed.

H2: Store atmosphere positively influences brand experience.

3.3. Product Assortment and Brand Experience

The third hypothesis proposes a positive relationship between product assortment and brand experience. The majority of studies have found a significant relationship between these two variables (Diehl & Poynor, 2010; Beneke, Cumming & Jolly, 2013). Additionally, Khan and Rahman (2015) posited that retailers not online, create brand experiences through an assortment of products but these experiences can also be created through the service interface, store atmosphere and price. Other scholars, such as Popa and Barna (2013), argued that multiple factors influenced customers’ experience with the brand and these factors are the social environment, service interface, store atmosphere, product assortment and price. Product range strongly influences store image (Aspfors, 2010), therefore it could be assumed that this image affects a consumer’s experience with a brand. The present study therefore proposes the following hypothesis.

H3: Product assortment positively influences brand experience.

3.4. Brand Experience and Purchase Intention

The fourth hypothesis for the purpose of the present study, proposes that brand experience positively influences purchase intention. According to Moreira, Fortes and Santiago (2017), brand experience comprises five components, namely, behavioural experience, affective experience, intellectual experience and sensory experience. A number of authors (Borrieci, 2011; Dai, Forsythe & Kwon, 2014; Nasermoadeli, Ling & Maghnati, 2013) have confirmed that brand experience positively influences purchase intention. In addition, Moreira et al. (2017) established that brand experience indeed led to purchase intention but added that brand experience acted as a mediator between sensory stimuli and purchase intention. Favourable brand experiences increase customer satisfaction (e. g.; Brakus et al.; 2009; Iglesias et al.; 2011; Iglesias, Markovic & Rialp, 2019; Lin, 2015; Yao, Wang, & Liu, 2013). This satisfaction is most likely an antecedent of purchase intention. Building on the aforementioned literature, the following hypothesis was presented.

H4: Brand experience positively influences purchase intention.

3.5. Brand Experience as a Mediator

A plethora of studies have confirmed that brand experience influences consumer buying behaviour (Ahn & Back, 2018; Brakus et al.; 2009; Iglesias, et al.; 2019; Iglesias et al.; 2011; Kim, Lee & Suh, 2015). Derived from the findings of these studies, it was demonstrated that brand experience influences behavioural intention, while brand experience mediates the relationship between a brand’s reputation and behavioural intention. Based on these considerations, the present study proposes that brand experience plays a key role in mediating the following relationships:

• Perceived store uniqueness and purchase intention

• Store atmosphere and purchase intention

• Product assortment and purchase intention

The following section present the study’s research design and methodology, followed by data analysis and results.

4. Research Design and Methodology

4.1. Sampling and Data Collection

The present study undertook a deductive research approach in which quantitative data was collected. The population was millennials aged from 18 to 35. Data was collected from 250 willing participants through a self-administered survey at a large university in Johannesburg, South Africa. Non-probability sampling, a form of convenience sampling, was used in selecting appropriate participants. (The use of only convenience sampling provides a lack of scientific rigour, in terms of the sample selection. Please study the comments below, in this regard). This was due to the difficulty in obtaining an accurate sampling frame and ensuring that every potential respondent had an equal chance of participating in the study. The survey contained a screening question to confirm that respondents classify as a Millennial consumer (between 18 and 35 years of age). Stratified sampling holds the benefit of mutually exclusive and collectively exhaustive strata (Cant, Gerber-Nel, Nel & Kotze, 2011). Once these strata were identified, the respondents were selected on the basis of convenience. This is most suitable as it is a simple, cost and time-effective method. Throughout the data collection procedure, strict ethical guidelines were followed to ensure the respondents knew that the survey was strictly anonymous and for academic research purposes only. Confidentiality was guaranteed and respondents had the choice of withdrawing at any stage during survey completion.

4.2. Measurement Instrument Development

The questionnaire consisted of two sections. Section A contained a brief set of questions on the respondent’s demographic characteristics, while Section B contained scales that encapsulated the variables as outlined in the conceptual model. Existing scales were modified and adapted to suit the context of the present study. All scales were measured and labelled based on a 5-point Likert scale. The first variable, perceived store uniqueness, was measured using a scale from Kim and Lennon (2008), while the second variable, store atmosphere, was measured using Jang and Namkung’s (2009) atmosphere scale. Product assortment was measured using Bauer, Kotouc and Rudolph’s (2012) product assortment scale. Brand experience was measured using a scale from Sahin, Zehir and Kitkapci (2011), while the last variable, purchase intention, was measured using a scale from Shukla (2011).

4.3. Measurement Instrument Assessment

In order to ensure reliability of the modified scales, Cronbach’s Alpha Coefficient ( > 0. 7) (Tavakol & Dennick, 2011) and the Composite Reliability (CR > 0. 7) (Hair, Sarstedt, Ringle & Mena, 2012) were analysed. It is evident from the results that the Cronbach Alpha Coefficient is above 0. 7 (Tavakol & Dennick, 2011) for all the variables, with the highest value being 0. 852 (store atmosphere), and the lowest value 0. 776 (perceived ease of use and product assortment respectively) (Table 1). Upon examining the CR, the results were found to be acceptable, with all the CR values exceeding the required threshold of 0. 7 (Hair et al.; 2012), therefore ensuring reliability.

4.4. Data Analysis and Results

In order to generate descriptive statistics, SPSS 25 software was utilised. Furthermore, more advanced statistics that include structural equation modeling (confirmatory factor analysis and hypothesis testing) were conducting through AMOS 25 software. More details on the analysis approach are provided in the following sections.

5. Results of the Study

5.1. Descriptive Statistics

Females represented 52% of the sample, while 48% were male. In terms of age, 90% of the respondents were between the ages of 18 and 27, while the remaining 10% was between 27 and 35 years of age. When asked whether they are familiar with the concept of pop-up retail, the majority (73%) indicated that they knew what a pop-up store is, while the remaining 27% indicated that they were uncertain of the exact definition of a pop-up store. Table 1 presents the accuracy analysis statistics for the study, followed by a discussion.

Table 1. Accuracy Analysis Statistics

PSU= Perceived Store Uniqueness SA=Store Atmosphere, PA= Product Assortment, BE=Brand Experience, PI=Purchase Intention, SD= Standard Deviation, CR= Composite Reliability AVE= Average Variance Extracted

Source: Compiled by researchers from SPSS data output

To test the statistical significance of the relationship, the Bootstrapping-resampling method was used. The procedure entailed generating 1000 sub-samples, of which the t-statistics suggested that all loadings are significant at pb 0. 001. As such, this confirms that all the measurement items converged well on their respective constructs and therefore are acceptable measures. As shown in table 2, all correlations between constructs ranged from 0. 070 to 0. 529, thereby falling below the 0. 8, as recommended by Hulland (1999), necessary to confirm discriminant validity. Furthermore, all constructs in the structural equation model were empirically unique by measuring different phenomena of interest, as suggested by Hair, Black, Babin and Anderson (2010) and Henseler, Ringle and Sarstedt (2015). Convergent validity is considered sufficient when the average variance extracted values of each construct exceed 0. 5 (Yang & Lai, 2010). In the present study, most values either exceed 0. 5 or fell slightly below the recommended threshold of 0. 5. The highest value was found to be between brand experience and store atmosphere (0. 70), although it still falls well below the required threshold of 0. 8. Table 2 presents the results of the inter-construct correlation matrix.

Table 2. Inter-Construct Correlation Matrix

Source: Compiled by researchers from SPSS data output

Discriminant validity was used to confirm construct validity, based on the inter-construct correlation matrix that had values of less than 1 for all correlations. This indicated that each construct was unique therefore measuring different aspects of the model. Upon examining the discriminant validity, a Confirmatory Factor Analysis was conducted. A number of items were, however, removed, due their low loadings. These results provide adequate support for acceptable levels of discriminant validity for the items used in this study.

5.2. Structural Equation Modeling

Structural equation modeling was conducted through a two-step process. First, confirmatory factor analysis established that prior scales adapted for this research, were still relevant and valid. Confirmatory factor analysis involved calculation on model fit, presented in Table 3. Second, hypothesis testing was conducted in order to determine whether the proposed hypotheses were supported or rejected.

Table 3. Model Fit Indices

Source: Compiled by researchers from SPSS data output

As indicated in Table 3, model fit was checked using a number of indices, such as the Chi-square (CMIN), the Goodness of Fit Index (GFI), Incremental Fit Index (IFI), Normed Fit Index (NFI), Comparative Fit Index (CFI) and Root Mean Square of Error Approximation (RMSEA). Based on the results (Table 3), it can be concluded that the model met all necessary criteria for model fit, thus making the model suitable for further analysis. After model fit assessment, the hypothesis results are presented in Table 4 and discussed thereafter.

Table 4. Hypotheses Results

PSU= Perceived Store Uniqueness SA=Store Atmosphere, PA= Product Assortment, BE=Brand Experience PI=Purchase Intention

Source: Compiled by Researchers from SPSS data output

From the results presented in Table 4, it is evident that all four hypotheses are supported and significant. In other words, perceived store uniqueness, store atmosphere and product assortment, all positively influence brand experience, which influences purchase intention. Upon analysing the results in further detail, the strongest relationship was found to be between product assortment and brand experience (H3), with a path coefficient of 0. 555. The second strongest relationship was between perceived store uniqueness and brand experience with a path coefficient of 0. 509. Furthermore, H2, (store atmosphere and brand experience) had the third strongest relationship with a path coefficient of 0. 345. The last relationship, H4, (brand experience and purchase intention) had the weakest of all the relationships with a path coefficient of 0. 207. This was also the only relationship that was not significant at p<0. 01 as it had a p value of 0. 04 suggesting that the relationship was only significant at p<0. 05.

5.3. Mediation Analysis

The results of the mediation analysis provided evidence that brand experience partially mediates the relationship between all three predictor variables and purchase intention. More specifically, it was found that perceived store uniqueness had a significant influence on purchase intention with a direct path coefficient of 0. 779, while store atmosphere had a path coefficient of -0. 385, and product assortment and purchase intention had a path coefficient of 0. 384. To conclude, both the direct and indirect relationships had significant results (p<0. 05), thus indicating partial mediation between the predictor variables and purchase intention.

Table 5. Presents the Results of the Mediating Effect of Brand Experience.

Table 5. Mediation Results

PSU= Perceived Store Uniqueness SA=Store Atmosphere, PA=Product, Assortment, BE=Brand Experience, PI=Purchase Intention

Source: Compiled by Researchers from SPSS data output

5.4. Mediation Check of Brand Experience Bootstrap Test

The directionality (positive or negative) of the path coefficients and the significance of the t-values were used to test the proposed hypotheses. The significance of the coefficients among the constructs was assessed using the bootstrap procedure (with 1000 re-samples) that provided the t-values for each path estimate. This indicates that the data of 208 respondents was re-sampled a thousand (1000) times from which the correlation was conducted.

5.5. Chi-square Difference Test to Compare the Base Model and Alternative Model

This was conducted in order to compare the base model (i. e.; with direct paths between three predictor variables and purchase intention) and the alternative model (i. e.; without direct paths between three predictor variables and purchase intention). All relationships were found to be significant, implying that perception of the uniqueness of a store indeed had a great impact on how customers felt inside the store due to its environment (store atmosphere), as well as their appreciation for the store’s product variety (product assortment). Furthermore, the results for the relationship between perceived store uniqueness and store atmosphere, product assortment and purchase intention were significant. This indicates that perceived store uniqueness indeed had a noticeable effect on how customers viewed factors such as the store’s environment, product variety, desire to purchase and their experience with the brand. Additionally, the results also indicate that the higher the perceived store uniqueness is, the greater the appreciation for store atmosphere, product assortment and brand experience, which would ultimately lead to higher levels of purchase intention. To conclude, all the proposed hypotheses were accepted.

6. Discussion and Managerial Implications

This study contributes to existing literature on the concept of multi-channel retail, pop-up fashion stores, Millennials, focusing on fashion products. The results of this study are of significant importance to retailers who wish to expand their distribution network to include pop-up retail stores. Firstly, it was found that the perceived store uniqueness plays a significant role in influencing consumer brand experience. This is consistent with previous research (Hyun & Park, 2015; Hwang & Hyun, 2015; Klein et al.; 2016) that found a significant relationship between perceived uniqueness and brand experience. This offers implications for marketers: it is critical for marketers to focus on the ‘uniqueness’ of the pop-up store and clearly incorporate creativity and appealing visual stimuli to attract consumers. Visual aspects, such as the window display, the colours of the pop-up store, the window decals, the lighting and other relevant visual cues should be the primary focus when designing the pop-up store. Secondly, consistent with previous studies by Beverland et al. (2006), Holmqvist and Lunardo (2015), and Kamaladevi (2009), it was found that by creating a pleasant in-store atmosphere, customers are likely to have a positive brand experience. Some specific recommendations for pop-up stores could include ensuring clothing is displayed in the window, having unique displays, such as placing the mannequins in different positions than usual.

Other specific recommendations would be to ensure that products offered in pop-up stores at all times are just as practical as those found in traditional stores. For example, clothing accessories and gadgets sold in pop-up stores should be reliable and durable. This will build credibility for pop-up stores and discourage customers (especially Millennials) who are very selective from going to traditional retailers. Furthermore, pop-up stores owners/ mangers must prioritise the importance of creating a feasible and memorable store atmosphere. This can be done by focusing on the sensory aspects that facilitate a pleasant in-store atmosphere, such as shop layout, colours, merchandise, displays, lightening, music and smell. Adequate attention should be paid to the professionalism of the floor staff, their uniforms and general appearance and helpfulness in order to complement the in-store environment. Thirdly, it was found that the product assortment is of significant importance in creating an overall positive brand experience. Previous research (Beneke et al.; 2013; Diehl & Poynor, 2010) made similar findings in that retailers must carefully consider their product selection in accordance with the needs of their target market. An implication for pop-up retailers is therefore, that they must ensure that they offer consumers a limited but much sought-after range of merchandise. This is because of the scarce space available to the retailers. It must, however, be considered that too broad a range may be overwhelming to a consumer, leading to lost sales. It is critical to balance product breadth and width to ensure a satisfactory product range to consumers. By encompassing the aforementioned suggestions of perceived store uniqueness, store atmosphere and product assortment, customers are likely to have a positive brand experience, which will ultimately have a positive influence on their purchase intention. Creating the ultimate in-store experience will increase the likeliness of customers purchasing a product. Previous research also points towards the significant relationship between experience and purchase intention (Borrieci, 2011; Dai et al.; 2014; Nasermoadeli et al.; 2013). Stemming from the managerial implications provided, it is imperative for marketers and managers of pop-up stores to allocate more resources toward distinguishing not only their offerings (products and services), but the physical environment (servicescape) in which they operate. This is because, based on the findings of this study, diversity in products (product assortment) was seen to greatly influence Millennials when they made their purchase decisions in pop-up stores. However, the study revealed that brand experience at pop-up stores had a weak impact on Millennials’ purchase intention. This possibly suggest that antecedents of brand experience (i. e. perceived store uniqueness, store atmosphere and product assortment) need to stand-out from the competition for the brand experience to have more impact on the consumer’s intention to purchase products at a pop-up store.

6.1. Conclusion and Contribution of the Research

This study investigated the influence of experiential marketing on purchase intention in pop-up stores among Millennials. More specifically, it investigated the importance of perceived store uniqueness, store atmosphere and product assortment on brand experience, and ultimately, on purchase intention. The results indicate that all four proposed hypotheses are significant, while brand experience mediates the relationships between the predictor variables and purchase intention. The findings of this study are important to marketers and retailers who aim to gain financial benefit from investing in pop-up retail concepts. Findings of this study contribute to the literature on Millennials’ perceptions toward pop-up stores, more specifically in a fashion context, even though they can be applied to other contexts and services, for example, food or services, as long as the physical environment matches the description of a pop-up store. As far as theoretical contribution is concerned, a unique model, not previously tested, revealed how brand experience mediated the impact of store atmosphere, perceived product uniqueness and product assortment on Millennials’ intention to purchase from pop-up retail stores. The theoretical contribution in terms of the SOR model, is that this research explored how consumers go through the process of buying products, in this case particularly from pop-up stores. More specifically, the study explained how consumers brand experience with respect to pop up stores was impacted by perceived store uniqueness, store atmosphere and product assortment. In addition, the present research contributes theoretically by explaining extent to which consumers brand experience in pop up stores ultimately leads to purchase intention. This contribution is relevant considering that the SOR model is concerned with how stimulus (social influence) leads to organism (psychological influence) ultimately leads to response (compulsive buying behaviour).

6.2. Suggestions for Further Research

Like all studies, this research was not immune to limitations. Firstly, the research was done in a case study format which could have made it difficult to generalise the findings. The data was only collected amongst one cohort of Millennials from a single university. Not all the respondents had visited a pop-up store, which could have influenced their opinions of pop-up stores. This could have possibly led to both sample and response bias in that all participants were exposed to the sample stimuli from the same environment. Their responses could have also been compromised due to the proximity that the respondents had with each other as well as with the field workers who administered the surveys. Further research could make use of more diverse samples and possibly adopting qualitative approaches to the same topic. This then leads to the second limitation - the nature of the study. The study was quantitative which possibly restricted responses because they were confined to closed questions on a Likert scale. Researchers interested in furthering the discussion on Millennials’ perceptions toward pop-up stores could conducted in-depth interviews that utilise open-ended questions. This would allow the respondents to fully express themselves. Generalisability could be improved in future studies on Millennials’ view on pop-up stores in that more representative samples could be used and probability sampling, which is more scientific and objective, could allow for more refined results that are a true reflection of the global Millennial population. Conceptually, further research could make use of potential hypotheses that were not tested in this study. For example, the impact of store atmosphere and perceived store uniqueness, the relationship between product assortment and store atmosphere, a direct relationship between product assortment and purchase intention and a direct relationship between perceived store uniqueness and purchase intention. Lastly, other theories and models may be adopted/ adapted to challenge the hypothesis outcomes of this study. It would be interesting to observe how rival models or opposing theories contribute to the discussion.

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