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HiO Opens its 4th Location

Digital brands want low-risk physical space.  Landlords want utilized assets.  HiO, which opened its fourth location this week, is part of a cohort of concepts positioned to balance a brand’s demand for physical space with the landlord’s supply of empty locations.

From a brand’s POV, you can think of HiO as the next generation pop-up.  From a property manager’s perspective – you can see HiO as either a retailer or the next generation of brokers. But consumer’s point of view will determine HiO’s success.

HiO hopes consumers think of its stores as a place to discover constant newness, featuring products from digital natives or international brands.  With a focus on bags and accessories, it is the b8ta for non-techies.  HiO may reap the benefits of:

  • Not carrying inventory
  • Providing a solution to property managers.

Theoretically, HiO could charge brands for placement, collect a % of revenue and receive very favorable terms from property managers. We took a quick look at who owns their real estate locations – Cadillac Fairview in Canada, Simon and Acadia Realty in the US – show HiO has convinced property owners to test the concept.  A glance at the assortment reveals a focus on international brands that would like to enter the US.

Will this assortment be enough to attract a consumer?

Moleskine is one of the brands featured in the new Brooklyn location.  But it doesn’t fit the “just introduced to the US” category.  And it definitely doesn’t fit the “just introduced to Brooklyn” category.   HiO’s challenge will be good assortment building.  For HiO to work, they will need a talented merchandiser for brand placement decisions.  Who is the consumer passing the location?  What brands appeal to them?  What merchandising adjacencies make sense?

IRL, a temporary store organized by GGP and the pop-up veteran Lion’esque group, should serve as a cautionary tale.  IRL failed at Chicago’s Water Tower Place due to a combination of a bad location and bad merchandising.  Taking space that other retailers didn’t want and then selling locally-known lobster rolls and coffee wasn’t a good pairing.  If HiO has good merchants, then it may work.  If it doesn’t, it risks the repercussions IRL suffered.

By David Weiss


McMillanDoolittle is a premier international retail consultancy bringing deep experience with world class clients. Our partners have extensive experience interpreting the retail marketplace and converting insights into successful strategies. We help clients develop innovative solutions in strategy development, the customer experience, new concepts, brand performance, retail performance improvement and retail intelligence services.

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