What’s In Store at the Apple Store

Joe Wilcox | March 04, 2004, 06:59 PM

During my trip to San Francisco this week, I visited the new downtown Apple Store, which, coincidentally, opened a few days earlier. Apple certainly has mastered the retail experience.

I recall the opening of Apple’s first retail operation, at Tysons Corner Center in McLean, Va., in May 2001. Apple’s attention to detail and design glistened everything with a magical Midas touch--but one destined only to turn the right things into gold. Apple also set a standard for stocking stores with well-informed sales folks as well as plenty of Macs, peripherals and software. Since, Apple refined its touch, but not by much, as it wasn’t needed.

Some stores, like the new one in San Francisco, are more grandiose--check out that glass staircase!--but remain inviting. The Tysons store, which is local to me, is busy. I’ve popped in there on a Wednesday morning at opening, and within 10 minutes found folks milling around. On weekends, I can stand at the door and count the Macs--the majority notebooks--going out the door at a fairly brisk pace. Rarely does a Mac owner walk out without a new printer, digital camera or some other peripheral. I bought a new PowerBook there recently and toted out a keyboard.

Apple positions the Mac as a hub for connecting digital devices and makes sure there is good software for using them. The approach lends itself to peripheral sales. I’m a good example. I bought that new PowerBook and keyboard for iLife application Garage Band.

I’m not sure what kind of margins Apple makes on peripherals, but even if the company made nothing the attach rate would have other huge benefits. If people want to buy peripherals for their Macs, then vendors have greater incentive to make sure their printers, cameras and other devices work with the computers. For a company like Apple, with tiny market share compared to Windows PCs, convincing vendors to provide Mac-compatible devices isn’t always an easy task; after all, the volume is with Windows PCs.

So, Apple’s digital hub approach pays off for peripheral manufacturers and the Mac maker, too, as it helps keep the platform vital with respect to Windows. People buy computers to use them. This should be a "duh" observation, but many other competitors’ operating systems faltered because there were either no applications or supported peripherals.

Take Linux on the desktop as an example. There are usable applications, but hardware support stinks in many cases. Anyone who has tried to configure, say, a Wi-Fi card on Linux knows. If the supported driver isn’t there, no one short of a hardcore geek can add the driver.

Being smaller benefits Apple. The company must be more creative, more inventive to compete with Windows. As for Microsoft, knocking 20-30 percent off Windows market share might be the best thing that could happen to the company, strange as that seems. Microsoft is a fierce competitor that produces its best work when the pressure is greatest. That’s when the company produces its proudest work.