Retail Management

APPLE RETAIL STORE

BY

ANKIT VASHISHT KARAN ARORA VAIBHAV KAPOOR

Origins of the  Apple CEO decided to build Apple Stores as a defensive move in the late 1990s, a time when big box computer retailers refused to stock its Mac computers due to the weakness of the Apple brand.  Jobs brought Millard Drexler, then-president of the Gap, onto the Apple board in 1999, specifically to help shape a retail strategy. So many Gap employees migrated to Apple's early retail team that they joked about working for "Gapple."  Drexler pushed for the hire of Ron Johnson, then a Target executive, who would shape such Apple Store fundamentals as the Genius Bar and scripted customer service approach before announcing his departure Tuesday for the CEO job at JC Penny.  Apple built a "prototype store" in a Cupertino, Calif. warehouse and tested its retail concepts for a year before opening the first two Apple Stores in Tyson's Corner, Virg. and Glendale, Calif.

Apple’s Success Formula.

Most commentators dwell on the obvious but superficial features of Apple‟s success including: the good design (airy interiors and attractive lighting, a carefree and casual atmosphere); attractive products (strong demand for the products) and focus (a single brand with far fewer products) scale (only a few hundred stores compared to Best Buy‟s more than 4,000) and clever marketing (the Steve Jobs factor).

Yet firms that have tried to copy these features like Best Buy [BBY] (which has copied the Geek Squad) and Microsoft [MSFT] (which opened its first branded store in 2009 with some of Apple‟s architectural and customer-service ideas), have had less success.

This can lead analysts to throw up their hands and declare that “it‟s just magic!”, i.e. success that is inexplicable by any rational process.

The Paradoxical Principles Behind Apple’s Success In reality, Apple‟s success is based on deeper principles that are neatly reflected in an interesting article by Yukari Iwatani Kane and Ian Sherr in the Wall Street Journal (Secrets From Apple’s Genius Bar). The article draws on confidential training manuals, a recording of a store meeting and interviews with more than a dozen current and former employees. Many of the principles will be counter-intuitive to any manager steeped in traditional management practices or retail, but obvious to any observer of radical management: Stop Trying to Make Money Most firms see themselves in business to make money. That‟s “the bottom line”—the primary goal of management. By contrast, Apple‟s goal is to delight its customers. Apple has grasped that making money is the result of the firm‟s actions, not the goal. By delighting the customer, Apple ends up making more money than it would if it set out to make money. The goal of “delighting the customer” leads to radically different managerial behaviors from traditional retail. Don’t Try to Sell

One consequence is that employees are taught not to sell. Kane and Sherr write:

According to several employees and training manuals, sales associates are taught an unusual sales philosophy: not to sell, but rather to help customers solve problems. “Your job is to understand all of your customers‟ needs—some of which they may not even realize they have,” one training manual says. To that end, employees receive no sales commissions and have no sales quotas.

“You were never trying to close a sale. It was about finding solutions for a customer and finding their pain points,” said David Ambrose, 26 years old, who worked at an Apple store in Arlington, Va., until 2007.

Kane and Sherr note that although there are no sales quotas, employees who don‟t sell what‟s expected are re-trained or moved to another position, depending on the store. Belief In the Goal of Delighting the Customer A firm cannot delight its customers unless the people who work in the firm believe in what it is doing. The sales people in Apple‟s stores “believe” in Apple and its products. The fact that Apple recruits from its adoring fans obviously makes it easier for them spread the message of delight. When a new product is launched, such as the second-generation iPad in March, employees cheer customers as they enter and exit the store: eliciting such behavior authentically is only possible if the sales staff really believe in what Apple is doing. –Continuous Innovation: Delighting customers requires continuous innovation. Many retailers strive for good customer service and attractive store designs, but few go to Apple‟s lengths in continuously improving every detail. With respect to store design, “most retailers take a prototype and roll it out,” Apple by contrast “constantly evolves its stores‟ look and feel,” said Brian Dyches, president of industry group Retail Design Institute. The stores are for instance phasing out that ubiquitous but irritating feature of retail stores, the cash register, by enabling sales people to complete transactions on mobile devices. –Operationalization of How to Delight Customers: Instead of starting with what Apple has to sell, the sales staff at Apple start from where the customer is and what the customers problems might be. Apple operationalizes its “steps of service” in the simple acronym APPLE: Approach customers with a personalized warm welcome; Probe politely to understand all the customer‟s needs; Present a solution for the customer to take home today; Listen for and resolve any issues or concerns; End with a fond farewell and an invitation to return –Attention to detail: Kane and Sherr note that Apple‟s control of the customer experience extends down to the minutest details. The store‟s confidential training manual tells in-store technicians exactly what to say to customers it describes as emotional: “Listen and limit your responses to simple reassurances that you are doing so. „Uh-huh‟ „I understand,‟ etc.” –Discipline: Just as there are rigid deadlines in Apple‟s product development, so there are rigid deadlines for retail employees. Apple employees who are six minutes late in their shifts three times in six months may be let go. You can‟t delight customers if you are not there. –Recruiting and training the right people: Department store chain Nordstrom Inc., for example, provides little customer-service training and expects sales staff to learn on the job. By contrast, Kane and Sherr note:

Working for an Apple store can be a competitive process usually requiring at least two rounds of interviews. Applicants are questioned about their leadership and problem-solving skills, as well as their enthusiasm for Apple products, say several current and former Apple store employees. While most retailers have to seek out staff, retail experts say many Apple stores are flooded with applicants.

Once hired, employees are trained extensively. Recruits are drilled in classes that apply Apple‟s principles of customer service. Back on the sales floor, new hires must shadow more experienced colleagues and aren‟t allowed to interact with customers on their own until they‟re deemed ready. That can be a couple of weeks or even longer. –Loyalty: In return, Apple asks for extreme loyalty. According to Kane and Sherr:

Employees are ordered to not discuss rumors about products, technicians are forbidden from prematurely acknowledging widespread glitches and anyone caught writing about the Cupertino, Calif., company on the Internet is fired, according to current and former employees.

Bottom Line: Radically Different Management

The obvious, superficial features of Apple‟s modus operandi—the good design, attractive products, the focus, the limited scale and the clever marketing—are certainly part of the Apple story. But they would mean little without the radically different management philosophy, which drives Apple‟s success. The fact that the principles are counter-intuitive to any manager steeped in traditional management practices or retail commerce indicates that any firm seeking to emulate Apple‟s success will have re-train their managers in radically different ways of thinking, speaking and acting in the workplace.

Personal setup

Here‟s some of what Apple cover during your Personal Setup session:

Mac Apple show you some of the key features of your new Mac. And apple set up your email, install any software you purchased, and help you discover and download some great apps from the Mac .

iPad Apple set up your email and help you personalize your new iPad. Apple also teach you some tips and tricks, set up iPad, and help you find and download the perfect apps.

iPhone Apple transfer your contacts and set up your email, calendar, and Find My iPhone. Then apple help you shop the App Store and download apps that match your interests.

iPod Buy an iPod touch and apple set up your email and help you download apps and games from the App Store. Buy an iPod classic, iPod nano, or iPod shuffle and apple teach you how to import , create playlists, and sync content from iTunes.

Workshops To get to know your new Apple product even better, join us at the Apple Retail Store for free workshops created for new owners just like you. In our Getting Started workshops, you‟ll learn all the basics — from changing settings and preferences to downloading new apps — and come away with tips and tricks. And our Going Further workshops will help you take your skills to the level as you discover advanced techniques to help you get the most from your new product.

Phone Support If you have questions and you‟d like to speak to someone on the phone, our Apple Support team is here to help. Apple can even call you at your convenience. Calls are free for the first 90 days after you purchase your Apple product.

One to One

Get the most out of your Mac. There‟s no better way to get set up, get trained, and get going on your Mac than with a One to One membership at the Apple Retail Store. The most knowledgeable Mac people in the world will transfer your files from your old computer, teach you all the basics in face-to-face training sessions, and guide you through more advanced projects. So whether you‟re brand-new to a Mac, a seasoned pro, or somewhere in betappleen, One to One will help take your skills to the next level.

One to One costs just $99 for a full year and is available only at the time you purchase a Mac from the Apple Retail Store or the Apple Online Store.

Get set up. It doesn‟t matter if you‟ve just bought your first Mac or you‟ve been using one for years. Your One to One membership will get you and your Mac set up and started out right. Just drop off your old computer — Mac or PC — and apple transfer your files, install any new Apple software you‟ve purchased, and put it all in the right places. Then come to Meet Your Mac in our store, and apple show you where everything is and ansappler any questions. So from the first time you turn it on, your Mac will be set up the way you like it.

Get trained. One to One features three different ways to learn. If you prefer to learn face-to-face, Personal Training Sessions offer an uninterrupted hour with a Trainer. As experts in all things Apple, Trainers provide guidance, support, and creative inspiration. If you prefer a small group setting, One to One Workshops are a unique opportunity for you and a few other members to work with a Trainer on special interest topics.

You can also learn from anywhere, on your own schedule, using your One to One appleb page. Your personalized One to One page lets you access hundreds of tutorials, schedule and manage your appointments, and explore projects created by other members.

Get going. If you need a larger block of time with a Trainer, just sign up online for a Personal Projects session. Then drop by the Apple Store anytime during the two-hour time slot to get the help you need. You can edit a film, mix a demo for your band, make a proposal pop, or create anything else you can dream up. Whenever you have a question, just ask — one of our Trainers will be available to show you how to keep your project moving forward.

Genius Bar

When you have questions or need hands-on technical support for your Mac, iPad, iPod, Apple TV, or iPhone, you can get friendly, expert advice at the Genius Bar in any Apple Retail Store.

The Genius Bar is home to our resident Geniuses. Trained by Apple, they have extensive knowledge of Apple products and can ansappler all your technical questions. In fact, Geniuses can take care of everything from troubleshooting problems to actual repairs. Want to speak to a Genius? Make an appointment ahead of time to guarantee your space.

Workshops

Learn something new by taking a free workshop at an Apple Retail Store. All of our workshops — including new hands-on workshops — are free. They‟re taught by people who really know Apple products and are eager to share their knowledge with you. So count on picking up plenty of tips and tricks.

At a workshop, you can learn the basics of the Mac, iPod, iPhone, or iPad. Find out how to create instant slideshows in iPhoto, rent movies using Apple TV, or get restaurant directions on iPhone. Serious photographers, filmmakers, and musicians will even find workshops on our poapplerful pro applications. Be sure to sign up in advance to reserve a spot. You‟ll have a great time and learn new skills.

Youth Programs

Youth Workshops From composing a song in GarageBand to building a photo album to creating a compelling Keynote presentation, our Youth Workshops offer families with kids (ages 6 to 13) a chance to work together to hone their Mac skills and use iLife and iWork applications to complete exciting projects. Apple offer the free workshops at Apple Retail Stores worldwide.

For Teachers Field Trip to the Apple Store Take your students — or your fellow teachers — on a Field Trip to an Apple Retail Store for an unforgettable learning experience. On their Field Trip, students can create something amazing right on the spot. Or they can bring in a project they‟ve already created and turn our store into a theater, sharing their achievements with parents, teachers, and friends. No matter which option you choose, everyone will have a great time.

For Kids Apple Camp Apple Camp will be back in summer 2012. registration is open. Lights. Camera. Camp. Nothing beats Apple Camp for a fun summer activity for your kids. This summer, kids ages 8-12 will learn the ins and outs of iMovie and how to make a film in about the time it takes to watch one. The free workshop, held at the Apple Retail Store, spans three days and leads up to an Apple Camp Film Festival where campers debut their masterpieces.

Business Every Apple Store has a Business Team committed to helping you find the perfect solution — from selecting the right hardware to leading customized training programs for you and your employees.

Joint Venture

Joint Venture is a program designed to help you use Mac, iPhone, and iPad to improve the way your business runs. Apple set up your new Apple products, train your employees to get the most out of them, and make sure everything stays working with dedicated support.

Apple set you up. The Apple Store will work with you from the beginning to make sure your new systems are up and ready to use, usually within 24 hours. Apple transfer your existing data — including your mail, calendar, and address book — from your PC or Mac, and install any additional software you‟ve purchased from the Apple Retail Store or the Apple Online Store.

Apple also activate your Joint Venture applebsite so you can easily access every Joint Venture service — schedule training, book appointments, get tech support, and sign up for workshops.

When everything‟s set up and ready to go, apple take the time to show you and your staff around your new products, so you‟ll be ready to hit the ground running.

Apple get you trained. Company training Schedule up to three two-hour sessions of training at the Apple Store for your employees. Our trainers will lead hands-on workshops on a wide variety of topics — like getting started on a Mac, using iPhone and iPad for business, and creating compelling presentations with Keynote* — and apple work with you to customize them for your company.

Getting Started workshops These monthly group workshops are tailored to business professionals who are working with a Mac for the first time or need to brush up on the basics. So as you add employees throughout the year, apple show them everything they need. Apple also offer special workshops for your IT department and will help them build a plan for supporting Apple products in your business.

Apple keep you up and running. Dedicated support For the first time ever, you can speak to an Apple Genius over the phone. You‟ll have unprecedented access to someone who can help fix your issue, check into necessary parts, and estimate repair turnaround time. Apple even loan you a computer. If you prefer to meet in person, you can make a Genius Bar appointment at any Apple Store in the world — apple‟re open early on appleekdays so you can stop by on your way to the office.

Anytime updates Your Apple products are designed to be reliable, secure, and easy to use, and apple want to help them stay that way. So apple run system diagnostics, update software, and even clean your keyboard and display — everything you need to make sure your equipment is helping you work at your full potential.

Loaner program If you need a computer while apple‟re working on yours, apple loan you a MacBook Pro or a MacBook Air ready to go with Mail, iCal, iWork, iLife, and Microsoft Office. So even if one of your machines is temporarily down, your business won‟t be.

Joint Venture app Website You‟ll get your own apple website that lets you access every Joint Venture service from scheduling training to getting tech support and more.