Jeff Chu, in a profile for Fast Company conducted entirely before Ahrendts took the job at Apple:
For a talented and ambitious merchandiser like Ahrendts, though,
revitalizing Apple’s enormous retail business might be the
ultimate challenge. The Apple Stores’ annual revenue of just over
$20 billion is more than six times Burberry’s, its 30,000-strong
staff is almost three times as large, and — due respect to the
trench coat — its products have insinuated themselves more
thoroughly into consumers’ daily lives.
Interesting comparison to today’s App Store announcement. Apple’s retail stores, which the company started in 2001 and which sell hardware costing thousands of dollars a pop, generate $20 billion in annual revenue. The App Store, which started in 2008 and predominantly sells apps costing a few bucks a pop, is already at $10 billion in annual revenue.
Yet Apple’s retail business has also fallen into relative stasis.
Its per-square-foot sales are still the envy of retail — just
over $6,000, about twice what runner-up Tiffany records — and net
sales rose 7% in fiscal 2013, but per-store numbers were flat,
since Apple opened 26 new stores during the year.
Per-store revenue growth would be good for Apple, no doubt. But if Apple’s per-square-foot sales lead the industry, twice that of second-place Tiffany, combined with the fact that Chu himself acknowledges receiving excellent customer service from the stores, what justifies Fast Company’s headline, “Can Apple’s Angela Ahrendts Spark a Retail Revolution”? Just like with Apple’s products, the key to its future retail success is more about iteration than revolution.
When was the last time Tiffany’s retail experience underwent a revolution?
★ Tuesday, 7 January 2014