“The party inside [Apple’s Midtown Manhattan] store and in 203 other Apple stores around the world is one reason the company’s stock is up nearly 135 percent for the year. By contrast, high-flying Google is up about 52 percent, while the tech-dominated Nasdaq index is up 12 percent,” Katie Hafner reports for The New York Times.
“The popularity of the iPhone and iPod and the intended halo effect those products have had on sales of Apple computers are behind Apple’s vigor. But the company’s success in retailing, as other competitors struggle to eke out sales growth, has been the bonus,” Hafner reports.
“Apple now derives 20 percent of its revenue from its physical stores. And the number is growing. In the fourth quarter in 2007, which ended Sept. 30, Apple reported that the retail stores accounted for $1.25 billion of Apple’s $6.2 billion in revenues, a 42 percent increase over the fourth quarter in 2006,” Hafner reports. “Apple stores generate sales at the rate of about $4,000 per square foot a year, according to a report last year by Sanford C. Bernstein analysts. As other electronics makers like Dell, Nokia and Sony still struggle to find the right retail formula, Apple seems to have perfected it.”
“Apple stores encourage a lot of purchasing, to be sure. But they also encourage lingering, with dozens of fully functioning computers, iPods and iPhones for visitors to try — for hours on end,” Hafner reports.
“‘Whenever we ask consumers to cite a great retail experience, the Apple store is the first store they mention,’ said Jane Buckingham, president of the Intelligence Group, a market research firm in Los Angeles. ‘Basically, everything about it works. The people who work there are cool and knowledgeable. They have the answers you want, and can sell you what you need. Customers appreciate that. Even the fact that they’ll e-mail you a receipt makes you feel like you’re in a store just a little bit further ahead of everyone else,'” Hafner reports.
Full article here.
[Thanks to MacDailyNews Reader “Winston” and “Citymark” for the heads up.]