Tag Archives | Retailing

1999 Microsoft Store vs. 2009 Microsoft Store

It’s official: the first Microsoft Store will be opening on this Thursday at 10am in Scottsdale, Arizona–logically timed to coincide with the launch of Windows 7. Nearly all articles about the company’s foray into retailing (a) point out that it’s a delayed reaction to the mammoth success of the Apple Stores; and (b) mention the fact that Microsoft’s first mall store was MicrosoftSF, which opened at San Francisco’s Metreon in 1999 and lasted only a little over two years before folding. (It was apparently an early victim of the Metreon curse which has since claimed nearly all of the mall’s merchants except for its movie theater, a bookstore, and some of the restaurants.)

Nobody accused Micorosft of aping Apple with MicrosoftSF–because that first Redmondian storefront opened almost two years before the first Apple Store did, and closed a few months after the Apple Stores got rolling. I visited the store several times, but don’t remember it very well, which might be part of the problem; it didn’t have a lot of personality. (If anything, it was in the mode of Sony’s Sony Style stores–in fact, it was actually operated by Sony, not Microsoft.) We’ll see if the new effort takes off–I’m still trying to figure out whether the world really needs a store devoted to the disparate stuff that Microsoft sells.

Here’s a quick comparison of the Microsoft store of 1999 versus this decade’s version, based on resources such as Microsoft’s original press release and a largely favorable piece Salon published at the time. Microsoft seems to be trying hard to keep what’s inside the Scottsdale store a surprise until Thursday, but I’ve pieced together some information and speculation based on sources such as Gizmodo’s leaked concept presentation for the chain.

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Nine Reasons RadioShack Shouldn’t Change Its Name

Radio Shack Catalog

[UPDATE: RadioShack has released a press release about all this, and I still can’t tell if it’s changing its name or not.]

Funny thing about RadioShack: I’m not sure if I’ve been inside its stores more than a dozen times over the past seven or eight years…and yet I still feel proprietary about it. The company’s TRS-80 microcomputers were what got me interested in technology in the first place. In college, I was a frequent customer of the location on Commonwealth Avenue in Boston, the oldest remaining store in the chain. I live about a mile from a RadioShack, and as I think about it, I believe I’ve either worked or lived within a mile of a RadioShack for the majority of my life. Which is nothing exceptional; the company is as omnipresent as any business that doesn’t sell hamburgers, chicken, donuts, or coffee.

Tonight, rumor has it that RadioShack is planning to change its branding to The Shack. I dunno if it’s true–the scuttlebutt that Pizza Hut was going to become The Hut turned out to be overblown–but there’s already a page on RadioShack.com with the slogan “Our friends call us The Shack.” If the 88-year-old electronics retailer is indeed dumping its name, I think it’s a bad idea, and I’m pretty sure I’m not just being resistant to change. After the jump, nine arguments against the new identity.

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Best Buy’s Interesting, Imperfect Experiment in Customer Service Via Twitter

TwelpforceOver at Zatz Not Funny, blogger (and frequent Technologizer commenter) Dave Zatz has blogged about Twelpforce, Best Buy’s interesting experiment in aggregating the knowledge of hundreds of its “blue shirt” staffers into one Twitterstream of advice for Best Buy customers. Dave points out that some of the blue shirts’ tweets (both on Twelpforce and their own Twitter accounts, which you might stumble across while reading) are a tad odd. He also says that the Twelpforce feed’s method of aggregation eliminates the “in reply to” links that make it a lot easier to read a Twitter conversation.

Perusing Twelpforce led me to a couple of other conclusions:

1) It’s increasingly clear that Twitter sees the use of its service as a customer service tool to be one of the keys to its long-term success. But Twelpforce is, among other things, a reminder that Twitter just isn’t a very good platform for customer service. Even if it did preserve “in reply to” links, it would be tough to reliably follow a discussion, in part because Twitter still doesn’t provide true threaded discussions. Twitter is generally pretty guarded about telling the world what it’s up to, but I’m wondering if it plans to roll out the features that would make it easier for companies to help their customers via Twitter. (The fact that folks such as Frank Eliason and the @comcastcares team do so much is a testament as much to their hard work as the power of Twitter in its current form.)

2) It’s fascinating to see Best Buy let the blue shirts do their thing in an open, largely uncensored venue. Oddly enough, the blue shirts in Best Buy commercials are consistently smart, courteous, and generally with it; the real blue shirts I’ve dealt with over the years have been a lot less consistent. (I recently had a question about a car-stereo component at my local Best Buy. The guy in that department shrugged and told me he couldn’t help, and directed me to go to the installation center for assistance. Which was across the store, behind a locked door When I got there, another rep told me…to go back to the car stereo section and ask guy #1 for help.)

Up until now, customer service with Best Buy or any other retail chain has been an essentially private affair. (Unless you like to go to electronics stores and eavesdrop on other shoppers’ experiences…which, I admit, I like to do as a source of story ideas.) With Twitter, it’s all out in the open. A blue shirt who knows his or her stuff can become a star; one who’s clueless will embarrass him or herself in public. I’d like to think that over the long haul that might help improve the quality of customer service, period…


Apple’s Monopoly: High-End Computers

Steve JobsThis is sort of amazing:  BetaNews’s Joe Wilcox has blogged about an NPD report that says that in June, 91 percent of dollars spent on computers costing over $1000 went to Apple. (I think the figure just covers sales at retail stores, not via the Web and other venues.) Windows still ships on 90 percent of computers, but it dominates in the sub-$1000 realm and on corporate machines–two areas that Apple has strategically chosen not to take seriously.

In other words, both Microsoft and Apple have operating system monopolies in the areas where they focus. (Microsoft would presumably be happy to grab more market share in $1000-and-above systems, but the pricing dynamics of the PC market make that more or less impossible.) For all the debate about Mac vs. PC, you could argue that the two platforms effectively don’t compete with each other any more than Chevrolet and Audi do.


Microsoft Stores Won’t Fall Far from Apple’s Tree

Microsoft StoreWhen Microsoft opens its retail stores this far, look no further than your local Apple store to find one. The software giant has designs to open many of its store in close proximity to its rival, according to reports.

Microsoft announced its intention to open retail stores in February. It placed David Porter, a new Microsoft corporate vice president and 25-year Wal-Mart veteran, as the executive in charge of its retail endeavors.

The notion that a Microsoft store could succeed has faced skepticism. Apple sells complete systems; whereas, Microsoft primarily remains a software company. Porter is working with Microsoft’s Entertainment and Devices Division, but throwing an Xbox in a window doesn’t exactly replicate the shopping experience of the Apple store.

When Microsoft announced its intentions to open store, I wrote that selling software in retail stores should be about as successful as opening a video rental business in 2010 (and made a crack comparing its stores to Wasabi flavored ice cream). My colleague Harry McCracken believes that a Microsoft store makes as much sense as a Procter & Gamble store.

Without having been privy to Microsoft’s plans, I still feel that way. I recently stopped by the Apple store at Fifth Avenue in Manhattan (the one with the giant glass cube out front) to exchange a faulty iPhone, and was amazed by how psyched people were to be giving their money to Apple. That store alone clears nearly $500 million a year in sales.

What’s more, it’s located across the street from Central Park, and it was a beautiful day when I visited. People seemed to be just as happy inside of the store as they were strolling by the park. Anyone out there want to argue that Microsoft customers have the same affinity for that company’s products?


iLine Report #2: Nothing to See Here

iLineHey, the sun just came up–which makes it a lot easier to type on a laptop without a light-up keyboard. I felt the need to check in here, but have nothing of consequence to report. There are about eight of us waiting to get into the Apple Store, and maybe three over at the AT&T line. Everyone’s being perfectly pleasant, but there’s not much chatter going on. Maybe we’re too sleepy.

People keep going up to the mall’s front doors and rattling them, as if they might mysteriously turn out to be unlocked, allowing us to go inside and ransack the place. Nope. If we’re lucky, we might get to go inside the mall before the Apple Store opens at 7am, but I don’t see that happening until at least 6:15am.

This is clearly the first year when the release of a new iPhone prompted only a mild iFrenzy, not the all-out iMadness we saw in 2007 and 2008. I wonder when the first year will be when there simply isn’t anyone frantic enough to show up at the crack of dawn at all? iPods seem to sell pretty darn well, but as far as I know, even the most fanatic iPod fan doesn’t rearrange his or her sleeping schedule to buy one.

And while I’m randomly musing: One of the earliest examples of people being so anxious to buy a tech product that they showed up in the wee hours was the release of Windows 95, with its famous midnight lines at CompUSA. It’s been a while since a version of Windows was a big enough deal to merit a shopping extravaganza, but Windows 7 is a substantial upgrade that a lot of people are looking forward to. Will there be midnight openings at Best Buy or Staples? I dunno–one relatively recent development with software is widespread public betas. If you’re super-excited about Windows 7, you’re probably running the release candidate already, and may well sleep in on October 22nd.

More updates later, but if you don’t hear from me, it’s probably good news–I may be making progress in becoming an iPhone 3G S owner.

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Okay, What’s The Fastest Way to Get Your Hands on an iPhone 3G S? (Which is Not Necessarily the Same Thing as the Smartest Way.)

iPhone 3GsI’m not saying it’s a good idea to try and buy an iPhone 3G S on next Friday, the day the phone is released. For one thing, the single best thing about the phone is likely to be iPhone OS 3.0, which every iPhone owner will be able to snag as a free download two days before that. For another, many iPhone 3G owners will qualify for larger discounts on the 3G S if they wait a month or two before upgrading.

But what if you absolutely must have a 3G S on the day of launch–and not only on the day of launch, but as early as possible on that day? (Hey, maybe you’re a tech journalist who wants to write about it while it’s still hot, hot, hot.) You’ve got multiple options, and they all have theoretical virtues and potential pitfalls?

Preordering from Apple for shipment. Apple says that iPhone 3G Ss will arrive on June 19th, the day of the phone’s release. It doesn’t say when on that day to expect them, though. And given that shipping is free, I’m thinking that they’re going out by some method that’s cheaper than priority overnight and therefore they may show up in the afternoon.

Preordering from Apple for in-store pickup. I did this at my local Apple Store, and it was kinda confusing–I used a Web-based signup form, and it never asked me for my name or gave me confirmation that I was all set. And it mysteriously talked about me buying a last-generation iPhone 3G even after I specified that I wanted a 32GB white iPhone 3G S. Given that I have no proof that I preordered, I have these visions of showing up and being turned away. In any event, the Apple Store rep I talked to told me that the store would open at 8am, and that both those who preordered and those who didn’t must wait in the same line. That likely means that it’ll make sense to show up really early. 5am, perhaps? No, 4am sounds safer.

Preordering from AT&T for shipment. The AT&T site seems to be dedicated to the notion that every piece of information must be phrases in a way that’s slightly too vague to be useful. Here’s what it says about shipping schedules:

Pre-orders for iPhone 3G S will be shipped with overnight priority and will be processed to arrive as early as June 19, 2009, if submitted by 12 p.m. noon C.T., June 17, 2009.

You might assume that “shipped with overnight priority” means that the phones will be shipped via priority overnight, and will arrive in the morning. But I’m guessing that AT&T really means that it’ll give priority to getting these phones out for arrival the next day. In any event, it’s very clear that it makes no guarantee that they’ll arrive by June 19th. I’m not sure whether that’s because it’s less confident about supplying demand than Apple is, or whether it’s simply covering itself by promising nothing.

Preordering from AT&T at a local store. AT&T stores are opening at 7am on the 19th–an hour before Apple Stores–and only for folks who preordered. Which makes preordering for local pickup from an AT&T outlet sound like the most efficient wayt to get a 3G S early. But when I tried to order one at my local AT&T shop, the rep told me that I might not get my phone until the 20th.

Thinking all this over makes my brain hurt. But here are some apparent facts:

  • AT&T isn’t promising anyone an iPhone 3G S on the 19th.
  • Apple does seem to be promising phones to those who preorder, and chances are high that you can walk out of an Apple Store that morning with one if you’re willing to wait in a potentially long line. Especially if you preorder, but probably even if you don’t. (With both the first-generation iPhone and the iPhone 3G, I had a phone in my hands within 45 minutes or so of the store’s opening on day one of the launch.)
  • I think it’s possible that the lines for this iPhone will be less insaaaaaane than those for the first two models, but it’s hard to know. The conservative move would still be to show up before dawn.
  • Preordering from Apple for shipment sounds like a reasonably safe way to get a phone on the 19th, but it might not show up until the afternoon.

Given all that, if I were trying to be among the very first people to buy an iPhone 3G S, I’d preorder from an Apple Store and wake up at the crack of dawn on Friday. I’m not saying I’m going to do this. But if I do, you’ll be the first to know…


Apple’s Fifth Avenue Store a Revenue Driver

applestoreFor anybody who’s been to an Apple Store, the company’s location on Fifth Avenue in New York City is quite the spectacle. Whether it’s the exquisitely-designed glass cube that is the store’s entrance, or the fact you can buy an iPod at 4 a.m., it’s always buzzing with activity.

Thanks to some sleuthing from the New York Post, we now have specifics. A prospectus for the GM Building, which was sold to a Boston-based group last year, listed $440 million in annual sales for the location. If correct, this would be about 10 times higher than the average store.

Furthermore, with $6.3 billion in revenue across the entire chain, it means that 7 percent of Apple’s retail revenues come from this one store. Pretty impressive, eh?

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The Beginning of the End of the Retailing of Content

Virgin Megastore Going Out of Business

Here’s a picture which I snapped last week on San Francisco’s Market Street: A Virgin Megastore which, like all remaining U.S. locations, is going out of business–across the street from one of the largest Apple Stores, which seems to be doing okay. The Virgin store mostly sells content on shiny discs; the Apple Store mostly sells devices for consuming content, no shiny discs involved.

I remember looking forward to the opening of this Virgin location as the building that contains it went up in 1995. (Trivia: The other original tenant was that 1990s relic, Planet Hollywood.) Even then, the days of big music/movie stores like Virgin Megastores were beginning to come to an end: Amazon.com also opened its (online) doors in 1995. Virgin sold its wares at list price or close to it, as you might expect of a business that had to pay for tens of thousands of square feet of primo real estate in some of the country’s most prestigious shopping districts. Amazon, from the start, sold stuff at the sort of deep discounts that a company without any retail footage at all can manage.

Even last week, weeks into the Virgin store’s liquidation, it was a poster child for why the retailing of content is a business that’s winding down. DVDs and CDs had been marked down by thirty percent–a sharp cut by Virgin standards, but still far short of typical Amazon discounts. And Amazon will ship for free. Which makes the only compelling reason to buy at Virgin the pleasure of browsing items in a real store (which I confess I still like) and the elimination of having to wait for an Amazon box to show up on your doorstep.

But it’s not discs shipped out in Amazon boxes that will render Virgin and all of its physical-world competitors irrelevant long term–it’s downloads and streams of the sort that Apple and Amazon, among others, are doing a job of embracing. It’s just going to be a few years until there are essentially no music and movie stores left except for independent ones that soldier on for reasons that go beyond mere profit. (The Bay Area is fortunate to have both Amoeba and Rasputin–long may they wave.)

Bookstores are going to take longer to vanish, but they’re going to get hit hard too, I’m sure. I’m not ready for e-readers to take over, but if there are still two nationwide book-centric merchants with gigantic stores in 2019, I’ll be surprised. I’m also assuming video game stores will be part of history by then, as will in-person DVD rental (hey, it’s not clear Blockbuster will make it to 2010). And as for good old fashioned newsstands? Well, I still like ’em, but they already give me a plessantly nostalgic feel.

Let’s end this with a T-Poll: