Sony vs Apple

Almost a decade ago, Sony’s market value was seven times more than Apple’s market share. Today, the tables have turned and Apple’s market value is eleven times more than Sony’s market value. Apple had ended Sony’s dominance of the music player market when Steve Jobs, launched the iPod inspired by Sony’s Walkman.

Apple’s Retail Strategy

For about a decade, Apple was struggling with bad retailing experiences and for no fault of its own. It then decided to expand into retail on its own. To strengthen its retail strategy, Apple hired Millard ‘Mickey’ Drexler, President and CEO of The Gap, to its Board of Directors in 1999, Ron Johnson, vice president of merchandising at Target in 2000 and Sony’s Allen Moyer as its vice president of development.

When the first Apple Store was launched in 2001, a few experts opined that the retail effort would fail within a year and a half. Today, it is regarded to be one of the core reasons contributing to Apple’s success.

“It makes absolutely no sense whatsoever for them to open retail stores.” – David Goldstein of Channel Marketing Corp in May 2001 in a MacWorld article Apple Stores: Sale of the Century?

Apple’s Experiential Marketing

The experience customers have to go through in a store in order to buy matters a lot. While designing great stores is a factor, what contributed to Apple’s success apart from great technological products was the kind of experiential marketing Apple provided to its customers. Many customers recall their experiences of Apple’s customer service, and how a bad experience turned into a good one. Sections of the store are dedicated for customers to actually use the products. A customer could freely experiment with Apple hardware and software.

The Apple Lifestyle

At any other store, once a customer purchases a product it would invariably mark the end of a relationship. But it was not so at an Apple store. Referred to internally as the ‘Apple Lifestyle’, any product purchase would be the beginning. A Genius Bar at the store would provide free/affordable service (answer questions, replacing or repairing parts) to a returning Apple customer. To build a long-term relationship and culture with the customer, stores would also conduct free seminars and community events.

Apple Store facts

  • The first two Apple Store opened in Tysons Corner Center in McLean, Virginia. and Glendale, California.
  • Over seven thousand customers visited Apple’s first two stores in its first weekend alone. They bought merchandise worth $599,000.
  • Apple has over 300 stores worldwide in 11 countries (figures as of February 2011).
  • Apple’s largest store (25,000 square feet) in the world is in London. The largest store in North America is in Boston.
  • Peter Bohlin, architect is behind Apple’s most famous stores around the world.
  • Apple Retail has 30,000 full-time-equivalent employees.
  • 15 Amazing Facts About Apple’s Retail Business

Microsoft vs Apple

In 2009, Microsoft announced plans to open some of its first retail stores near Apple stores. Its stores were similar to Apple stores.