Fortune: ‘Why Apple is the best retailer in America’ | iLounge News

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Fortune: ‘Why Apple is the best retailer in America’

Following Apple being named to Fortune’s list of most admired companies, the magazine has published an interesting article on the beginning of Apple’s retail store effort. “I started to get scared,” said Apple CEO Steve Jobs about depending on large retailers to sell Macs before Apple’s first retail store was opened. “It was like, ‘We have to do something, or we’re going to be a victim of the plate tectonics. And we have to think different about this. We have to innovate here.’” Apple’s 174 stores, which each attract 13,800 visitors a week on average, now produce sales of $1 billion a quarter for the company. The average Apple Store generates sales of $4,032 per square foot a year—more than Saks, Best Buy, and Tiffany & Co.

Jobs told Fortune how he helped kick off the retail effort. “We looked at it and said, ‘You know, this is probably really hard, and really easy for us to get our head handed to us.’ So we did a few things. No. 1, I started asking who was the best retail executive at the time. Everybody said Mickey Drexler, who was running the Gap.” Jobs then went after Ron Johnson, then a Target executive, to run the retail store operations. “One of the best pieces of advice Mickey ever gave us was to go rent a warehouse and build a prototype of a store, and not, you know, just design it, go build 20 of them, then discover it didn’t work,” said Jobs. Interestingly, the first Apple Store prototype was scrapped, delaying the launch of the first store by 6-9 months.

Another interesting detail in the article is that the Apple Store Genius Bar was conceived after the majority of a focus group told Johnson that the best service experience they’d ever gotten was from a hotel concierge. “When we launched retail, I got this group together, people from a variety of walks of life,” says Johnson. “As an icebreaker, we said, ‘Tell us about the best service experience you’ve ever had.’” Of the 18 people, 16 said it was in a hotel. “We said, ‘Well, how do we create a store that has the friendliness of a Four Seasons Hotel?’” The answer: “Let’s put a bar in our stores. But instead of dispensing alcohol, we dispense advice.”

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Comments

1

Well, this is genuinely interesting.  I have visited four Apple Stores—San Francisco Union Square, Santa Monica’s 3rd Street Promenade, Newport Beach’s Fascist Island, and New York’s 5th Avenue—and I have disliked every single second in them.  I don’t find them very well laid out and most of the employees were unhelpful—both in that they knew little and that they didn’t seem to want to help.  And the lines are dreadfully long and, worse, unreasonably slow.

I readily admit that the design of the store is nice overall—especially 5th Avenue, which is an example of post modern design done right—but there’s a lot more to retail than just looking cool.

Overall, I avoid the Apple Store at all costs, even though it’s more convenient for me than, say, Best Buy.

I may be the minority but this is just my two cents.

Posted by Camembert on March 8, 2007 at 1:58 PM (PDT)

2

The Apple Store in the Mall of America does not have cash registers.  Each Sales Consultant carries a handheld scanner to ring up your purchases.  They can then print out a receipt or have one e-mailed to you.  I went to an Apple Store in Charlotte recently and they did not use this system.

Posted by Galley in Greenville, SC on March 8, 2007 at 2:12 PM (PDT)

3

The Apple Store in Fairfax, VA (outside of Washington DC) uses the handheld scanners during busy seasons. 
I enjoy wandering through the Apple Store, but I agree that the employees haven’t seemed overly eager to really help out.  I bought an iMac about a year ago and not a single employee mentioned the $200 rebate on printers when I bought my Mac.  I was almost completely through the check-out process when my girlfriend noticed a little sign indicating it!  Luckily she said saomething or else I would have left without over knowing about it.  It was certainly an added bonus that I didn’t expect, but I shouldn’t have had to discover it for myself!

Posted by mc123 on March 8, 2007 at 2:35 PM (PDT)

4

Experiences in Apple Stores vary considerably from location to location. Because we live in an area where there are many Stores within 30 minutes of our offices, iLounge’s editors have had very positive experiences in certain Stores and with certain staff, while others have been less impressive. Satisfaction surveys could really help some of the weaker stores learn from their mistakes - or, at least, alert Apple’s executive team to widespread problems of perception.

Posted by Jeremy Horwitz in East Amherst, NY, USA on March 8, 2007 at 3:27 PM (PDT)

5

I am really surprised the retail stores are this well regarded. As with Jeremy Horwitz, I live around MANY Apple stores. I am always impressed with the look and feel of the stores and think the idea of the “classes” was true genius.  Most staff interaction I have had has been negative:  either they are fools or have the social skills of the tech guys on forums.  I also no longer purchase big ticket items at the stores due to their TERRIBLE return policies.

Posted by superape on March 8, 2007 at 3:42 PM (PDT)

6

I personally have had nothing but great experiences with the Chicago Apple store on Michigan Avenue. The only negative is that it’s swarming with tourists.

Posted by thelottery on March 8, 2007 at 4:27 PM (PDT)

7

I go to the one in International Plaza in Tampa, FL.  I love the store layout, I love the products…but I agree with the return policies…terrible.

I like having one close by to check out when I want to see the new products hands on before I buy online.  I’m a huge fan of the refurb section at the Apple Store online.

Posted by twitzgall on March 8, 2007 at 4:50 PM (PDT)

8

I Don’t understand why people have had all this Problems, I always go to the Mall of America Store, and for anyone who has been there you know how busy they can get.  That is also my complaint with them, but nevertheless even with all the people and CROWDS I feel they have trained their employees, fairly good.  There has only been a couple of times that my full question was not answered, but most of the time they have someone else in the store that knows the answer.  Love, the training classes, and the ability to also try the products before you buy,  and also try most of the software, because most of the programs are installed into their demo computers for you to try.  Yes I have bought many items on Apple’s website, But I feel that before I fork out $2500.00 on a new computer I want to test it , run it, and make sure this is the one I like.  Only a Apple store can do that.

Posted by Scott on March 8, 2007 at 5:56 PM (PDT)

9

mc123,  That’s because there is no such thing as a $200 rebate on a printer, it’s $100.  I’ve bought several macs, and ever time the $100 rebate has been mentioned to me.

Posted by matrixSJD on March 8, 2007 at 8:24 PM (PDT)

10

I live in the L.A. area, where we have as many Apple stores as donut shops.  I have to agree with some of the other posters here—the stores are amazing as showcases for their products (I want everything I see), but the staff is largely indifferent, and the return policy is apalling.  I prefer to buy online, where I save on sales tax (and sometimes I’ve been comped on shipping, too).

Posted by hill_w on March 8, 2007 at 8:50 PM (PDT)

11

I met Ron Johnson on several occasions when i worked at Apple, and he is simply amazing.  The man knows things about selling stuff in stores that I had no idea there was to know.  I would advise any business-school student to take any opportunity they get to hear him lecture.

-jcr

Posted by John Randolph on March 8, 2007 at 8:54 PM (PDT)

12

Living in England, my closest store is in California (ok no it’s not!). But the two I have visited (San Francisco + Fashion Valley) both had friendly staff.

Posted by Daveoc64 on March 9, 2007 at 2:11 AM (PDT)

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