“The [Mac] Geniuses – tech support staffers clad in black, offering free advice from behind a sleek, barlike counter – were an afterthought when Apple expanded into retailing in 2001, another non-traditional tool to bring in shoppers and draw attention that Apple computers were not getting at traditional computer retailers,” Jefferson Graham reports for USA Today. “The concept has become so successful that 100,000 people visit the Geniuses every week. And the stores represent nearly 50% of Apple’s retail sales.”
“Thanks to brilliant marketing, savvy neighborhood locations and a revival of the company’s fortunes sparked by the hip iPod digital music player, Apple stores are hot. Walk into one in Los Angeles’ outdoor mall The Grove, in New York’s Soho district, on Chicago’s North Michigan Avenue or in Austin’s Barton Creek Mall, and it is likely to be jammed with customers. Saturday, Apple opened its first European store, in London’s West End district. Next month, the 100th store will open, in Bethesda, MD,” Graham reports. “Not bad for a company that serves just 3% of the computing public.”
“Longtime Apple analyst Charles Wolf, of Wall Street securities firm Needham & Co., calls the retail stores Apple’s ‘hidden secret,’ because they generate so much cash: $376 million of Apple’s record-setting $2.3 billion in fiscal fourth-quarter revenue, with store sales up 95% from the same period a year ago. Apple stores are on track to generate $1.2 billion this year. Apple’s fiscal 2004 revenue was $8.3 billion. ‘Half of the people who walk into the stores are Windows users,” Wolf says. “They come in not because they want to switch but because the stores are different and so inviting. Do they walk out with a Mac? Probably not. But they do leave with an iPod, which they might not have done otherwise.’ The Apple Store grew from a small idea to a large part of the corporate profile. The stores make money and draw crowds, but they haven’t reached their main goal: getting Windows users to switch to Macs,” Graham reports.
“‘Why that hasn’t happened is such a mystery to me,’ Wolf says. Apple’s overall market share is still 3%. Even if adjusted to include only the consumer segment, it’s just 3.5%, Wolf says. Johnson isn’t concerned. He says that 56 million computers are sold a year and that Apple’s annual supply of 2 million or more is healthy. ‘Computers are a big, diverse market, with consumer, corporate (and) education categories,’ he says. ‘You don’t need a lot of market share to be a big and profitable business,'” Graham reports.
Full article here.
MacDailyNews Take: Increased Mac market share hasn’t happened yet because it’s still too early. People holding onto their Windows boxes for the past 2 or 3 or more years may soon be in the market for a new computer. Hopefully, they’ll stumble into an Apple Store and learn about the Mac option to Wintel hell, because they sure won’t find out anything of value about Mac OS X from Apple via TV or print ads. Note to Apple, now would be a good time to tell the world about Mac OS X in major TV and print campaigns. Most “average” people we show Mac OS X to are completely surprised that it even exists. Showing them Exposé alone reduces them to awe. For some unknown reason, Mac OS X seems to be Apple’s real “hidden secret.”
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Top Ten things Apple needs to show the world about Macintosh – July 30, 2003