View source for Store-within-a-store

{{Short description|Retail concept}}

[[File:Stores within a store Gucci Louis Vuitton At Bloomingdales Tysons Washington DC metro area.jpg |thumb|Enclosed stores in [[Bloomingdale's]] department store, [[Tysons Corner Center|Tysons]], [[Washington metropolitan area|Washington DC metropolitan area]]]]
[[File:Cosmetics_Hall,_Liverpool_department_store,_Polanco,_Mexico_City_-_View_from_above2.jpg|thumb|300px|Separate counters by brand: Cosmetics Hall at [[Liverpool (department store)|a Liverpool department store]] in [[Mexico City]]]]
[[File:Toys R Us department in Macy's Center City Philadelphia.jpg|thumb|300px|Section of main sales floor: Toys R Us section at [[Wanamaker's|Macy's Philadelphia]] [[flagship store|flagship]], 2024]]
A '''store-within-a-store''', also referred to as '''store-in-store''' (North America) or '''shop-in-shop''' (U.K. et al.), refers to a space within a larger retail store, designated for use by a specific brand to feature its products, clearly branded with signs and other branding elements like color, materials, layout, etc. Such a space may be a section of the main area of the store, or it may have the form of an enclosed store with "walls" an entrance, much like a store in a shopping mall. Stores-within-stores are particularly common in Europe and Asia.<ref>{{Cite journal |last=Shen |first=Lu |last2=Zhuang |first2=Guijun |last3=Teng |first3=Wenbo |date=January 2019 |editor-last=Ignaciuk |editor-first=Przemyslaw |title=A Decision on the Store‐within‐a‐Store Strategy Based on the Uncertainty Model |url=https://onlinelibrary.wiley.com/doi/10.1155/2019/4080435 |journal=[[Mathematical Problems in Engineering]] |volume=2019 |issue=1 |doi=10.1155/2019/4080435 |issn=1024-123X |doi-access=free}}</ref>

==Types==
Varieties of the store-in-store concept include:<ref name="lossprev">{{cite web |last1=Seivold |first1=Garett |title=Coming to a Store Near You? Another Store |url=https://losspreventionmedia.com/coming-to-a-store-near-you-another-store/ |website=Loss Prevention Media |date=30 November 2021}}</ref>

*Branded boutiques: Larger retail stores may allocate space for a specific brand to set up a distinct section of their main sales floor or a separate, walled-off boutique with a distinct entrance, within their store. This allows the brand to create a unique and immersive shopping experience for its customers.
*Sub-brands of the same retailer: The store-in-store may be owned and operated by the same retailer, with a sub-brand aiming to create an identity for a department aimed at a specific sub-market or unusual collection of merchandise, such as [[El Corte Inglés]] department stores' "Mini Home" area for children's furniture and home decor,<ref>{{cite web |title=Mini Home |url=https://www.elcorteingles.es/mini-home-el-corte-ingles/?vuestore=2 |website=El Corte Inglés |access-date=6 February 2024}}</ref> or a "[[Macy's]] Backstage" discount store-in-store within a Macy's department store.<ref>{{cite web |title=Macy's opens its flagship Backstage store at Herald Square |url=https://pix11.com/pix11-partner-sponsored/macys-opens-its-flagship-backstage-store-at-herald-square/ |website=PIX11 |access-date=6 February 2024 |date=19 May 2022}}</ref>
*Complementary products: Retailers may collaborate with other businesses or brands to showcase complementary products, such as a brand of coffee near the small appliances area where coffeemakers are sold. Or a grocery store chain – whose core business is not serving coffee and food for consumption on premises — may decide to place coffee shops of a certain brand within a number of its locations.
*Pop-Up Shops: Temporary or seasonal setups within a larger store to create customer awareness, to test new markets, and/or to promote specific products for a limited time, such as sunscreen or beachwear in the summer, or a Christmas boutique in the autumn.

==Business model==
The "store in store" concept allows brands to leverage the existing customer traffic of a larger retail space, while the hosting store benefits from offering a diverse range of products and experiences to its customers. A study by academics from the [[Wharton School]] found that the arrangement works because the retailer offers prime locations for which it can charge high rents, the manufacturer makes a higher profit than it would through a wholesale model, and the consumer gets a lower price and better service. The operator of the store-within-a-store can provide these benefits because it receives all profits, instead of having to share them with the retailer, as it would in the traditional split between manufacturer and retailer activities. The study also found that the arrangement works best for relatively non-substitutable goods, like [[cosmetics]] and brand fashions.<ref>{{cite web |author= |date=September 2, 2009 |title=The Economics Incentives of the 'Store-in-a-Store' Retail Model |url=https://knowledge.wharton.upenn.edu/article/the-economic-incentives-of-the-store-within-a-store-retail-model/ |url-status=live |journal= |publisher=Knowledge@Wharton (news module of the [[Wharton School of the University of Pennsylvania]]) |archive-url=https://web.archive.org/web/20120108055552/http://knowledge.wharton.upenn.edu/article.cfm?articleid=2333 |archive-date=January 8, 2012 |access-date=October 19, 2024}}</ref><ref>{{Cite journal |last=Jerath |first=Kinshuk |last2=Zhang |first2=Z. John |date=August 2010 |title=Store within a Store |url=https://www.researchgate.net/publication/259839230_Store_Within_a_Store |journal=[[Journal of Marketing Research]] |volume=47 |issue=4 |pages=748–763 |doi=10.1509/jmkr.47.4.748 |issn=0022-2437 |access-date=October 19, 2024}}</ref>

==By retail format==
===In department stores===
Cosmetics and fragrance departments in department stores are usually in the form of counters dedicated to a single brand.

Flagship high-end department stores such as [[El Palacio de Hierro]] Polanco in [[Mexico City]], [[De Bijenkorf]] in [[Amsterdam]] and [[El Corte Inglés]] Castellana in [[Madrid]] dedicate a half-floor or entire floor of their store to branded boutiques of clothing, accessory, cosmetics, and other high-end or luxury brands. Such a large area of individual boutiques has more the appearance of a shopping mall than a traditional department store.<ref>{{cite news |title=El Palacio de Hierro de Polanco abre sus puertas |url=https://lifeandstyle.expansion.mx/moda/2015/11/06/el-palacio-de-hierro-de-polanco-abre-sus-puertas--2 |access-date=6 February 2024 |work=Expansión |date=6 November 2015 |language=es}}</ref> Any similarity in procedures and policies versus the main store may be limited to certain functions such as accepting the host store's credit card, keeping the same opening hours, etc. Personnel may be hired by the brand, and then may or may not be employees of the host store, even if they have a security badge issued by the host store.<ref name="lossprev"/> In fact, some department stores such as [[Illum]] in [[Copenhagen]], [[Denmark]], have transformed all their space into such boutiques, making them, technically, shopping malls.<ref>{{cite news |title=Magasin har solgt Illum |url=https://markedsforing.dk/artikler/nyheder/magasin-har-solgt-illum/ |access-date=6 February 2024 |work=Dansk Markedsføring |date=8 October 2003 |language=da-DK}}</ref>

More department stores have sections dedicated to brands within the main shopping area of the store. The U.S. department store [[Bloomingdale's]] has had such arrangements with [[Ralph Lauren Corporation|Ralph Lauren]], [[Calvin Klein]], [[DKNY]] and [[Kenneth Cole Productions|Kenneth Cole]], while [[Neiman Marcus]] has had them with [[Armani]] and [[Gucci]].{{citation needed|date=February 2024}} Former [[JCPenney]] CEO [[Ron Johnson (businessman)|Ron Johnson]] focused on the concept in the 2010s, with [[Liz Claiborne Direct Brands|Liz Claiborne]] and [[Levi Strauss & Co.|Levi's]] sections in the chain's stores.<ref>{{Cite news |last=Tuttle |first=Brad |date=2013-04-08 |title=Can the Boutique ‘Store-Within-a-Store’ Concept Save Big Box Retailers from Extinction? |url=https://business.time.com/2013/04/08/can-the-boutique-store-within-a-store-concept-save-big-box-retailers-from-extinction/ |access-date=2024-10-19 |work=Time |language=en-US |issn=0040-781X}}</ref>
===In discount stores===
U.S. variety store [[Five Below]] which became known for selling products at 5 dollars and under, has been successful up through 2023 with their Five Beyond store-within-a-store concept, which sells items priced above 5 dollars, and expanded it to 400 locations.<ref>{{cite news |title=Five Below expands Five Beyond concept - RetailWire |url=https://retailwire.com/five-below-expands-five-beyond-concept/ |access-date=6 February 2024 |work=Retail Wire |date=20 March 2023}}</ref>
===In supermarkets and hypermarkets===
In 2022 there were about 6000 Starbucks licensed stores, which included those located inside of supermarkets of the chains [[Kroger]], [[Hy-Vee]] and [[Publix]], as well as those inside gas stations, hotels, hospitals and airports.<ref>{{cite news |last1=Leigh |first1=Wendy |title=Starbucks Stores In Kroger Are Changing In A Major Way |url=https://www.tastingtable.com/1013825/starbucks-stores-in-target-and-kroger-are-changing-in-a-major-way/ |access-date=6 February 2024 |work=Tasting Table |date=19 September 2022}}</ref>

About 1,800 (as of early 2024) [[Target Corporation|Target]] [[hypermarkets]] (superstores) in the U.S. feature a large section branded as [[CVS Pharmacy]] selling medicine and personal care products. CVS had acquired Target's pharmacy business in 2015 for about 1.9 billion USD. Target also has design, creative and store-in-store partnerships with brands like Apple, Disney and Starbucks.<ref>{{cite news |title=CVS to close some pharmacies inside Target stores |url=https://www.retaildive.com/news/cvs-closing-pharmacies-inside-target-stores/704461/#:~:text=CVS%20acquired%20Target%27s%20pharmacy%20business,blog%20post%20at%20that%20time. |access-date=6 February 2024 |work=Retail Dive |date=January 2024}}</ref>

In 2001, [[Posten Norge]], the Norwegian postal service, began to move away from standalone post offices to {{Lang|no|Post i butikk}} ({{Gloss|Post in store}}) stores located in grocery stores.<ref>{{Cite news |last=Myrhaug |first=John M. |date=February 3, 2001 |title=Coop og Hakon overtar |url=https://urn.nb.no/URN:NBN:no-nb_digavis_sortrondelag_null_null_20010203_93_24_1 |url-access=limited |archive-url= |access-date=October 19, 2024 |work=Sør-Trondelag |pages=5 |language=no |via=[[Norwegian National Library]]}}</ref>

===In electronics superstores===
Electronics store chains similarly use store-within-a-store concepts. In 1997 under interim CEO [[Steve Jobs]], [[Apple Computer]] began a partnership with [[CompUSA]] to establish dedicated departments for its products, which would showcase [[Mac (computer)|Macintosh]] computers, software, and accessories, and be staffed by Apple-trained employees and representatives. Apple had phased out its retail agreements with other big box stores in favor of the CompUSA agreement, dissatisfied with their neglect of the products in favor of [[Microsoft Windows]]-based [[Personal computer|PCs]] with lower [[Margin (finance)|margins]].<ref>{{Cite web |date=2021-05-20 |title=Before the Genius Bar: Behind the retail designs that paved the way for 20 years of Apple Stores |url=https://9to5mac.com/2021/05/20/20-years-apple-retail-stores-compusa-early-designs/ |access-date=2024-02-01 |website=9to5Mac}}</ref><ref name="retail challenge">{{cite web |last=Eran |first=Daniel |date=November 8, 2006 |title=Apple's Retail Challenge |url=http://www.roughlydrafted.com/RD/Q4.06/1DDD598A-7CE0-479E-A6F9-912777CAB484.html |url-status=live |archive-url=https://web.archive.org/web/20160415153316/http://www.roughlydrafted.com/RD/Q4.06/1DDD598A-7CE0-479E-A6F9-912777CAB484.html |archive-date=April 15, 2016 |access-date=April 26, 2017 |website=Roughly Drafted}}</ref><ref>{{cite web |last=Pogue |first=David |date=March 1, 1999 |title=Desktop Critic: CompUSA: Apple's Not-So-Superstore |url=http://www.macworld.com/article/1014845/desktopcritic.html |url-status=live |archive-url=https://web.archive.org/web/20170329115612/http://www.macworld.com/article/1014845/desktopcritic.html |archive-date=March 29, 2017 |access-date=March 23, 2017 |website=[[Macworld]] |publisher=[[International Data Group]]}}</ref> Since the early 2010s, [[Best Buy]] has extensively used the concept for major vendors such as Apple, [[Samsung Electronics]], [[Google]], and [[Microsoft]] (whose agreement called for the entirety of their PC departments to be branded as "the Windows Store", showcasing OEM devices alongside Microsoft hardware such as [[Microsoft Surface|Surface]] and [[Xbox]]).<ref name="success">{{Cite news |date=July 17, 2017 |title=Why the grim reaper of retail hasn't come to claim Best Buy |first=James|last=Peltz|first2=Jack|last2=Flemming|url=http://www.latimes.com/business/la-fi-agenda-best-buy-20170717-htmlstory.html |url-status=live |archive-url=https://web.archive.org/web/20170728063658/http://www.latimes.com/business/la-fi-agenda-best-buy-20170717-htmlstory.html |archive-date=July 28, 2017 |access-date=July 28, 2017 |work=Los Angeles Times}}</ref><ref>{{Cite web |last=Keizer |first=Gregg |date=2013-06-13 |title=Microsoft seizes floor space in Best Buy for Windows mega mini-stores |url=https://www.computerworld.com/article/2497749/microsoft-seizes-floor-space-in-best-buy-for-windows-mega-mini-stores.html |access-date=2024-02-01 |website=Computerworld |language=en}}</ref><ref>{{Cite web |last=Warren |first=Tom |date=2013-06-13 |title=Microsoft and Best Buy team up to create a 'Windows Store' inside 600 retail locations |url=https://www.theverge.com/2013/6/13/4426598/microsoft-best-buy-windows-store |access-date=2024-02-01 |website=The Verge |language=en}}</ref>

=== In drugstores ===
[[Canada Post]] has post office locations located in some drug stores.<ref>{{Cite news |last=Mcneish |first=Joanne |date=August 11, 2024 |title=The Rise of the Store-within-a-Store, a Retail Innovation to Help Save Physical Shopping: The Store within a Store: Hudson’s Bay, Housing Small Mountain Equipment Co. Shops, is Indicative of the Trend |url=https://www.theglobeandmail.com/business/commentary/article-the-rise-of-the-store-within-a-store-a-retail-innovation-to-help-save/ |access-date=October 19, 2024 |work=[[The Globe and Mail]]}}</ref><!-- unsourced and dated ===Cellphone stores-in-stores===
{{unsourced section}}
In the early days of [[cellular telephone]] growth in the U.S., wireless companies were concerned about showing investors a return and profits sufficient to cover the infrastructure costs. Cell phone towers situated in urban areas are typically not attractive and [[NIMBY]] neighbors made those costs higher. The carriers needed wide retail exposure and employed a distribution methodology that included making "agents" out of car stereo and alarm stores, car washes and other retailers since early cell phones were not mobile and needed to be installed in a vehicle. The advent of portable cell phones in the marketplace in the early 1990s meant more retailers could participate, since installations were not necessary for portable cell phones.

Phones were distributed through cell phone wholesalers to these retail agents. Eventually, wireless carriers also began limited distribution of portable cellular phones to their "agents" and retailers. The original membership "[[big-box store|big-box]]" [[warehouse club]], [[Price Club]], located in [[San Diego]], wanted to participate in the cellular phone sales for Price Club members. They contacted a cellular wholesaler, Beau Bennett, a San Diego resident and cellular wholesaler and asked to meet with him to discuss their options. In that subsequent meeting, Mr. Bennett showed Price Club buyers a range of portable cell phones and proceeded to layout a method to retail the phones with cell phone displays in Price Club warehouse stores. When the topic of profits arose, Mr. Bennett explained there were two channels of income related to cell phone service and equipment sales. There were adequate and typical profits on equipment and there was also an option for the retailer to participate in the carriers airtime profit. Airtime contracts could pay certain 'agents' as much as $350 and 7% of the customers monthly service bill, who typically signed airtime contracts for 2–3 years of cellular service.

Price Club buyers explained that those profits were "excessive" according to the corporate enshrined profit limits established by Price Club founders. This profit rejection was an issue that needed to be addressed and Price Club buyers asked Mr. Bennett to try and find a way for them to participate. After considering several options, Mr. Bennett eventually choose to form a third-party company, called Cellular Order Desk, to provide trained employees located at a kiosk just inside the entrance of the first Price Club location on Morena Boulevard. in San Diego. The arrangement Mr. Bennett offered included a smaller profit than originally intended, but within Price Club profit limits, for each cell phone sold.

Price Club buyers agreed to a one store trial which proved successful and popular with members. Eventually this first store-within-a-store program expanded to 3 additional locations, then to seven locations and eventually to all Price Club stores in [[Southern California]]. Price Club and Costco merged in 1993 and the first widely known store-within-a-store concept was expanded to include those additional warehouse locations in Southern California. Trained Cellular Order Desk employees staffed all stores and provided one-stop shopping for members. A customer could enter a Price Club/[[Costco]] warehouse location, choose a cell phone model and have it activated and available for pick-up at the [[will call]] window on the way out of the store. In those days, every cell phone had a programmable [[Number Assignment Module]] (NAM) which required pairing the phone's [[Electronic Serial Number]] (ESN) to the carrier's service. Some early phones were programmed with an electronic NAM writer device, but the handsets sold at Price Club/Costco locations were primarily programmed with the cell phone keypad.
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== References ==
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[[Category:Business models]]
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