Apple stores are the reference of the physical trade.
A model bucking the trend
The first Apple Store opened in Virginia in 2001, at a time when everyone admired the Dell model and predicted that Apple was doomed to failure by opening its store. Apple’s idea was to regain control of the brand experience in the face of the boom in PCs. And Apple immediately banked on the location of its stores as one of its key success factors. A fact sometimes forgotten by certain pure players who have branched out into bricks-and-mortar retailing (see “Commerce Reloaded”, 2015 edition).
At present Apple has 97,000 employees, half of whom work in its 450 stores worldwide. Apple stores generate $21 billion of sales, 12% of Apple total turnover. In comparison, LVMH’s 480 or so stores worldwide generate 3.1 billion dollars.
With stores averaging 750 square metres in area, receiving 350 million visitors a year, making sales of
56,000 dollars per square meter, while Macy’s are $1800 per sq m, Target’s are $2200 per sq m and Best Buy’s are $7800 per sq m.
Apple’s sales staff are called specialists, and none of them are paid commissions, to avoid “hard selling” and customers leaving with products they don’t need.
The success of the Apple Store model, a source of inspiration for many retailers, is based on a sizeable IT infrastructure that required substantial investment.
At Opéra for instance, 200 to 300 terminals are connected simultaneously (between visitors’ terminals and those of Apple’s specialists), which requires a quality Wi-Fi network, otherwise the store would go out of business! Moreover, Apple has developed a number of tools to run its stores.
The shift to digital at retail outlets
Apple has developed a number of tools to run its stores digitally, including:
– Smartsign, which has been managing the content of iPads used for product sales support in Apple stores since 2011. The same CMS is used in iPads and on Apple’s web site. Using iPads enhances the visibility and continuity of information between the online store and the bricks-and-mortar store.
– Genius Plan: equivalent to Smartsign for sales staff, enabling them to make better product recommendations or even mobile phone operator recommendations in some countries, like the UK.
– iPlano: is a planogram for distributing the corresponding Smartsigns. The content of Smartsigns is decided and controlled at Cupertino. The iPad automatically displays the in-store location of products thanks to the terminals’ global positioning feature, which avoids any set-up problems.
IPlano is used whenever a new product is launched or during the Christmas season to lay out the store accordingly.
iBeacon at the heart of Apple Stores
The Bluetooth Low Energy iBeacon has been rolled out in Apple Stores since late 2013 in three places: at the store entrance to handle the pickup, on the accessories wall to encourage the use of Easypay, and on the iPhone 6 tables.
These beacons send out two types of notification:
– a “proactive” notification, which vibrates or rings the phone, used only for in-store pickup to avoid any intrusive effects.
– a discreet “on wake” notification, simply with an on-screen message. A welcome message at the store entrance, near the tables to confirm one’s interest in the new iPhone, on the accessories wall to encourage customers to use Easypay B2C.
Sales staff equipped with mobile devices
Easy Pay is also the term used for the sales staff’s mPOS terminals. The mPOS terminal is an iPhone or iPod touch with an Ingenico body (iSMP) that includes a scanner shell, a magstripe reader, a smart card reader and a NFC reader. This terminal replaces checkout tills and can handle orders placed online for in-store collection and online product returns.
It features a Runner function for certain staff who go and fetch the customer’s product from the store’s stockroom in under two minutes, thereby enabling the salesperson to stay with the customer. The salesperson calls the Runner for the product. Geopositioned on iPlano, he sees a photo of the specialist who asked him for the product self-service transactions made by customers in real time, with the B2C version of Easy Pay on Apple store. It also shows that a customer made two consecutive failed self-service payment attempts with his iPhone. The salesperson can then go and meet the customer and offer to help finalize the purchase.