Bloomberg’s Caroline Hyde reports on the challenges awaiting Angela Ahrendts as she takes over as vice president for retail at Apple on Bloomberg Television’s “The Pulse.”
Retail sales were flat for the last quarter, [Apple’s] fiscal 2nd quarter, and, in fact, they’re getting less bang for their buck… In 2013, retail profits down 13% for retail, even though they opened 26 more stores. So what’s going on here? …The fact that you’re getting cheaper competitors and also copycatting, really, some of their styles. The airy stores with their see-through staircases that Steve Jobs brought in Ron Johnson to really push through, well, now they’ve got Asian rivals copycatting to a certain degree; the “geek chic” isn’t only being done by Apple anymore. The Genius Bars are somewhat being copied, as well, so clearly they need to do something new to get us buying in these stores.
It’s all about just getting the youth involved, bringing back the style to Apple overall. What did [Ahrendts] do so well at Burberry? She innovated. She brought social media to Burberry, to the luxury element, far quicker than… her competitors… Will she try to embrace the younger buyer once again and just bring that luxury aspect back to Apple. – Caroline Hyde
Direct link to video here.
There retail stores outsell every other store in every mall. They haven’t lost any shine. They make lots of money for Apple which was predicted in the beginning to be a total failure when they started in retail. So this FUD story can just go away. The new retail CEO should work on better working conditions for there retail employees with better salaries since they do a lot more than your typical retail worker. That’s where the work needs to be done. The public loves the Apple stores and they do shine quite well.
Shareholders demand continuous growth when reality is finite. That’s the essence of the so-called “problem”.
Exactly, B9! Another story manufactured out of nothing and signifying nothing.
Do they go to a special “How to Write Complete Vacuous Crap” course?
No, Sean. It comes naturally to them.
Non-issue. When you put your first stores “out there” you pick the cream of the crop locations where the traffic is as large as you will ever see.
As you expand to hit the mid-level cities, you can’t expect to match Manhattan. You particularly can’t expect new countries to have the same pull as London & NY.
A truer measure would require multiple measurements including how volume is moving at the mega-locations like Times Square.
You also can expect shopping malls to try and rape you for a bigger share of the pie if you are AAPL.
I want to think Apple Retail hasn’t suffered because of the Browett Effect and lack of leadership at the highest level, but it has.
That’s why I’m happy Ms. Ahrendts jumps onboard this week.
… or something.
I’m sure one reason Ms Ahrendts was hired was to rapidly expand Apple retail locations in promising markets like China. Apple has about 13 stores there whereas Burberry has 70. This is good use of some of Apple’s offshore cash as China Mobile is rapidly expanding their 4G network throughout China. Good partnership. BTW, I’m certain Apple’s stores sales per square foot average of $4,400 is still comfortably ahead of all other retailers. By contrast, Best Buy sales would be in the $800 range.
I wasn’t aware of the China connection. Interesting. Thx.
I believe Apple’s sales per square footage value had passed he $6000 mark a while back…where did you find $4400 if I may ask?
1-The first thing would be to ban hipsters from employment. I think hiring is done like casting instead of on merit.
2-Second, bring back the Macs and accessories to prominence to the store. One used to go to the Apple store to buy things other than overpriced cases for damn cell phones. The growth in much of the world for Apple is in the Mac- not the saturated Phone market.
1) Irrespective of a staff-member’s appearance, all that should matter is how well that person helps you in the store, and in my dealings with staff in my local Apple Store they’ve never failed to be both polite, helpful and knowledgable.
2) I don’t know how often you ever venture into an Apple Store, but my local one has tables full of devices, from iPod Nano’s through iPhones, Touches, iPads, MacBooks, iMacs and they even had a new Mac Pro on display last time I was in there.
How much more equipment would you like to see on display, exactly?
But then, you’re always keen to display your ignorance of just about anything to do with Apple…
Rorschach, Apple stores HAVE gone downhill a bit since their early days. It’s a fact, and completely ignoring this fact does no one, not you, not me and certainly not Apple, any good.
I’ve been in several Apple stores many, many times over the years. My early experience was that the personnel typically knew nearly as much about Apple equipment as I did, in some cases even more, and in some rare cases, much, much more. For the last couple of years that has NOT been the case. With virtually zero exceptions in the last year or so, I know more about the equipment than the people in the Apple store. This is a MAJOR shift in the staff’s knowledge. When I have to walk the “Genius” through an issue and suggest solutions, there is something wrong.
Add on top of that the disdain some of the staff has for customers and there absolutely has been a significant shift in the Apple store experience.
Just one example was where my wife was put into the queue to get one of her devices fixed. The queue was reordered without here being told. When she asked why she wasn’t even told that several others were suddenly put in front of her, let alone being told why she was being pushed further back in the queue, she was told, “It happens all the time.” — but not until after the staffer rolled his eyes at her as if to say, “Do I really have to explain this to you?” She got no further information from that staffer as he turned his back and walked away.
Multiple other times in the last couple years, I’ve gone into an Apple store to get a specific item that is not on the floor proper. A staffer had to go into the back to get the specific item. Believe it or not, half — yes, literally half, the time the staffer has come back with the wrong item! If they don’t even know what the equipment does or what is needed, then they shouldn’t be working there.
In all fairness, not all my experiences at the Apple stores over the last two years has been bad. When I get very good service I track down the store manager and make a point of complementing the person who helped me just as when I get very bad service I contact the manager to point out the bad service. It’s my tiny part to help make the stores better.
However, my (and most of the people I know) overall experience has been worse in the past couple of years. To ignore that helps no one.
My local Apple store looks like an iPad/iPhone store with a few- very few- Macs and fewer Mac accessories.
Maybe you do not remember what the Apple Store was like before it became a showroom for iPhones. I guess you were enjoying your Dell running Vista.
Two tips Darwin…
1. If you expect him to believe what you say about your local store, the least that logically applies is that you believe what he says about his local store.
2. And try not writing like a petulant 14-year-old.
I just love it when junior journalists try to tell the professionals how to do the job. It has taken a while but the juniors have moved in and now throw what weight they have around and in the process they prove without a doubt that they have no brains and will also accept payola.
What are the average sales per square foot of an Apple retail store compared to Microsoft, Sony, Samsung retail stores? Apple still sells more per square foot than Tiffany’s Retail stores do, or any major department store at any mall that Apple stores are leasing space from, so… STFU.
I went to the downtown Portland Apple store a few weeks ago to pick up an iMac I had ordered over the phone. I was completely blown away by how busy the store was during a regular mid-week afternoon. There had to be 12-20 “experts” in blue, most in full demo question/answer mode with customers, or fulfilling orders, or demoing products. I asked the guy who finalized my order for pickup if it was unusually busy, and he laughed and told me it was actually slower than most days… the amount of product walking out that single store was just astounding. I don’t think they have a serious retail problem.