The store-within-a-store concept is an effective tool to eliminate risk for both the host and the occupier, and provide the customer with something new, exciting, and perhaps unexpected and experiential.
In-store partnerships are "tested" in a handful of stores before they are rolled out portfolio wide. As a shared revenue model, both parties have a vested interest in the success of the in-store retailer. If the test fails to achieve predetermined benchmarks, then they shake hands and part ways, with minimal capital loss and risk to both parties.
When the relationship is productive, the host wins by providing a synergistic product or service that is likely outside of their core competency to self-fulfill. The in-store occupier wins by capturing the inherent footfall of the host. Also, their occupancy costs are greatly reduced as they scale up stores more rapidly than a traditional lease model. Lastly, the customer wins through the discovery of complementary products and services that provide convenience and reduce friction in their shopping behavior.