“Apple Computer has shown people will gladly part with money at its candy stores for geeks,” Scott Martin reports for Red Herring.
“But here’s a little-known fact: Apple’s chic stores don’t just sell more per square foot than even Best Buy, they beat some of the best in the luxury retail world silly, according to a report released Tuesday by Bernstein Research analyst Toni Sacconaghi,” Martin reports.
“Apple’s stores have hauled in annual sales per square foot of $4,032, compared with Best Buy’s $930, Neiman Marcus’ $611, and luxury store Tiffany & Co.’s $2,666, according to Bernstein,” Martin reports. “It’s a wild contrast to the failure of Apple rivals such as Gateway to break into the retail market.”
“Mr. Sacconaghi said that Apple’s retail stores have played a significant part in Apple’s success over the past five years,” Martin reports. “The analyst said Apple retail stores also had an influence on brand awareness. That brand awareness is equivalent to $60 million spent on advertising, he noted. Apple has 170 retail locations in four countries. The Mac maker has about 150 U.S. locations.”
Full article here.
Success is driven by good leadership. Something that takes tremendous discipline.
Precisely why you cannot accurately gauge the sales of anything Apple-related without their retail and online store figures.
Makes me feel smug.
mw england . . . . just bought 9 shuffles in the new Chester store . . . xmas sorted
Apple’s retail stores are absoulutely responsible for better sales of Apple products. The exposure in the Malls is definately been good for Apple. The way they do things in the store also helps. All the systems fully loaded with software that you see on the shelves and networked to even access the internet. How many Fry’s stores have working displays that you can actually start and stop programs on. Most of theres don’t work at all or they lock the systems out with stupid passwords making it useless to have a live display. Trained staff that know the products helps to sell your products too. Best Buy doesn’t have this either.
Big freakin’ deal. Wait until Microsoft opens their boutiques. Microsoft’s shops will cater to sophisticated, intelligent consumers who are woefully underserved by those dumps Apple calls stores.
Best of all shoppers can get their hands on the magnificent Zune or even try Windows Vista in an upscale environment. Windows users are about sophistication, quality and elegance. Cost is almost never an issue. You hear that Apple lemmings? Try looking past the price tag and maybe you’ll discover some real innovation: Zune and Vista!
You Apple lemmings can have your crappy stores filled with second-rate, “me-too” garbage. Windows users demand better. They wouldn’t be caught dead at an Apple Store.
Your potential. Our passion.
Good to see the point made that the stores expenses, or much of them at least, can be considered part of the advertising budget. Traditional advertising is damned expensive and there are better ways to achieve the same result provided that the product is decent. Of course most mass market companies take the opposite approach, cut the cost of the product and spend the difference on advertising. This is one of the factors that has caught up on Dell, they only sell through advertising.
Apple’s stores are great for brand recognition. They are a great way to leverage Apple superior marketing skills. And the fact that the stores are doing so well is a testament to the popularity of the iPod, which has led to more recognition for the superior Mac OS.
However, these stores are not a great accomplishment on doing retail “right.” A lot of the computers in the store consistently don’t work and before the random shutdown syndrome problem was solved on the MacBook half the MacBooks in my local Apple Store were constantly shutting off. The tabletops are filthy, dusty and in desperate need of cleaning. The customer service at the store is very sub-par, not to mention the Mac Genius’ being very sarcastic and condescending. The Apple Store is no different from any other retail store as far as customer service and presentation is concerned.
Everywhere you look, Apple is excelling.
Even those ill-informed reports that iTunes Store sales were taking a dip were not just wrong, but the exact opposite of the truth.
e.g. In the Amazon best-seller charts for ALL electronic products, the $25 iTunes Music card has either been the top-seller or, as it is now, second from top – behind the 2 GB Nano silver – for the last few days!
That’s incredible!
Apple’s going to have a bumper Christmas!
Zune Tang
I see Bill et al, have you under their spell. I guess Steve is not the only one with “reality distortion field”
Best o luck with your Vista, and your viruses, and your whole wintel world.
It might be nice for you to disclose just how much experience you have with the Mac, and specifically Mac OSX, to lead you to your conclusions. I would gather from your comments, not a lot.
si le gere, se la vie
What ever happened to that “big Times Square deal” M$ made last year?
MW: 2007: The [hopeful] fall of an empire- and a terrible one at that!
“Best of all shoppers can get their hands on the magnificent Zune…”
I heard they’re slippery and keep popping out of your hand like a bar of wet soap.
“…or even try Windows Vista in an upscale environment.”
The only place they’ll be able to try it since most home users will need a new computer to go with the new operation system.
“Windows users are about sophistication, quality and elegance.”
This sentence should read: “Windows users are clueless about sophistication, quality and elegance.”
“Cost is almost never an issue.”
Translation: The cheapest is always the best.
The previous Zune Tang was funny before the current imposter stold the handle and became a poor imitation of the original. Kinda like MS did with OSX.
“Big freakin’ deal. Wait until Microsoft opens their boutiques. Microsoft’s shops will cater to sophisticated, intelligent consumers who are woefully underserved by those dumps Apple calls stores. “
Waits for laugh track…
The sarcasm meter went haywire at about word six…
They make that kind of money per square foot… and they have the some of most spacious stores I’ve ever seen.
Zunee. Zunee, Zunee! Please! Remember “microsoftSF” at the Metreon in San Francisco? Of course, Microsoft closed it two years later…
Hey Mister ‘Tang,
You forgot to mention that the Microsoft store sells its software on a plethora of hardware. It’s all represented in the store even though it’s just a bit too confusing to customers.
They’ve also included a Wizard Bar to answer folks questions about software security and explain how Vista makes it all better. It’s easy. Just buy one of the dozens of computers on display.
Not all that confusing after all…
Another article with Rob Enderle quotes. That guy is everywhere.
Zune Tang is right on.
I’m all for the Apple stores, don’t get me wrong. I got my Macbook Pro there. However, the sales per square foot leader moniker is a bit misleading. Apple has a limited product line, all of which takes up very little floorspace to sell. Plus, inventory is relatively easy to manage, or can be arranged for delivery if not immediately in stock. The advertising angle is huge, regardless of sales. I went to an Apple store 20 times before I bought my computer and played with ipods, macbooks, macbook pros, etc.. Plus, Apple stores are always in upscale centers. The walkthrough traffic is amazing. It suits the brand and strengthens it every new potential customer that walks through the door. It removes the “Techy” feeling of going to Best Buy or Fry’s to buy something. However, no other computer manufacturer could get away with it. How many people would be inspired to walk into a Dell store?
Back to the article…
It seems ridiculous to compare sale per square foot between Apple and Best Buy. Best Buy is about bargains on a much wider variety of merchandise. Compare BB with Costco or Circuit City, not Apple Stores. The comparison with Gateway is more on target and even more impressive. I admit that when Apple first said it was going “brick and mortar” I thought they must be high. Gateway was just then beginning to tank, and the internet store for electronics seemed to be a foregone conclusion. As with MP3 players, Apple proved that it knows how to reinvent what we think we already know and show us quality and innovation can create all new opportunity and success. I’m glad to have been proved wrong!
Actually, I think it would be a wise long term investment to buy a Zune right now and keep it, unopned, as an investment. Fifty years from now it might bring a great price (along with the countless other MS flops) as a collectors item/museum piece.
Allen not sure what your point is about a limited product line… If you are referring to the fact that it is only computer related, I still think they swamp a CompUSA competitor. As for the stores being located in “upscale centers” this is just not true. I have been to many locations across the country and most of them have been in your every day mall.
I must agrees with everything else that you wrote. I feel so sorry for the Dell sales people at the Kiosk just down the mall from our local Apple Store (Knoxville, TN). People go by look at the Dells and are told that they will have to wait for their order to be built and shipped. All the while people are walking buy taking their new Macs home to use right away…
Hey, very true about the Zune being a collectable. They are going to hit the trash bins and/or ebay auctions in large numbers about a month or so after Christmas. Every ebay Zune buyer will become an ebay Zune seller within a month of his original purchase. At some point they will be so cheap on ebay that it won’t pay for the auction add to sell them so the dumpster is the only place left. They will become scarce within a year. If you can pull a brand new one out of storage, still in it original package 50 years from now it will be worth a lot!
People will always pay for quality. There rivals sell crap.
I just got back 5 min ago from my local mall. There is an extremely busy Apple Store and a little Hell kiosk next the Sears. The Hell kiosk looks so pathetic with a couple of stragglers milling around it, I almost feel sorry for Michael Hell – almost. Best Buys numbers would be even worse if it weren’t for the windfall profits from unpaid rebates!
Rock on Steve!
Candy store for geeks? What does that even mean? That Apple makes fluffy computers that aren’t serious machines?
And out of all the computer stores out there, Apple’s customers are the least geekiest… I see grandparents and couples and kids all in there asking about photos and music and video making…. Certainly not typical geeks.
Guess it’s just a case of bad writing…