By Jim Karpen on Fri, 01/13/2012
The New York Times reported yesterday that Apple plans to open a store-within-a-store at 25 Target locations this year. According to the report, Target is only testing the concept at this point. And there's no word on how much these new stores will resemble regular Apple Stures. Apple already has a simliar offering at 600 Best Buy locations, with some of those actually having consultants on hand, just as at Apple Stores. I like this trend, and the fact that the Apple brand, and friendly service, is spreading. Apple has not only revolutioniized phones, computers, MP3 players, tablet computers, etc., it has also revolutionized retail stores.
There are 361 Apple Stores worldwide, and it was reported last year that they make more profit per square foot than any other retailer in the U.S. You can read more on CNET. A research firm calculated that in the four quarters ending June of 2011, with global sales of over $14 billion, Apple made $5,626 per square foot of floor space — far ahead of second-place jewelry store Tiffany & Co., at $2,974 per square foot.
It's no accident. Steve Jobs controlled every tiny detail of the Apple Stores, just as he controlled every facet of Apple's successful products. As with everything else, he focused not just on function but also on the user experience. When you walk into an Apple Store, the first thing you notice is that typically it's full of people. And they're enjoying themselves. And there are employees there to help you enjoy yourself without pressuring you to buy something.
Walter Isaacson reported in his recent biography of Steve Jobs that back in 2000, when Steve Jobs first decided to create retail stories, he actually had Apple build a mockup inside a warehouse. As with everything else, Apple's initiative was a closely guarded secret. Then in 2001 the first Apple Store was unveiled. Critics rolled their eyes, thinking that it was crazy for Apple to be not only making computers but also opening stores. It just didn't seem like a good step. But as usual, Steve Jobs's instincts were right.
An article last June in the Wall Street Journal explains why the stores have been so successful. The secrets include: complete control of how employees interact with customers, actual scripts for the technical support specialists, and control over every last detail of the store, including the preloaded music and photos on the demo devices. See ifoAppleStore.com for many more characteristics of of the Apple Stores.
Even though the focus of the stores is a relaxed atmosphere for the customers, the WSJ article says that Apple exerts a tight control on how they operate. In interviews with former employees, the Wall Street Journal learned that they are trained not to sell products, but to help customers solve problems. The article quotes a confidential training manual, which says, "Your job is to understand all of your customers' needs — some of which they may not even realize they have." That does sound like Steve Jobs. The article says that employees don't receive sales commissions, nor do they have sales quotas. You can get a sense for the Apple Store philosophy on their web page that introduces their retail stores.
As with everything else, the Apple way is different — and more successful.