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Success is driven by good leadership. Something that takes tremendous discipline.

Precisely why you cannot accurately gauge the sales of anything Apple-related without their retail and online store figures.

Makes me feel smug.

mw england . . . . just bought 9 shuffles in the new Chester store . . . xmas sorted

Apple's retail stores are absoulutely responsible for better sales of Apple products. The exposure in the Malls is definately been good for Apple. The way they do things in the store also helps. All the systems fully loaded with software that you see on the shelves and networked to even access the internet. How many Fry's stores have working displays that you can actually start and stop programs on. Most of theres don't work at all or they lock the systems out with stupid passwords making it useless to have a live display. Trained staff that know the products helps to sell your products too. Best Buy doesn't have this either.

Big freakin' deal. Wait until Microsoft opens their boutiques. Microsoft's shops will cater to sophisticated, intelligent consumers who are woefully underserved by those dumps Apple calls stores.

Best of all shoppers can get their hands on the magnificent Zune or even try Windows Vista in an upscale environment. Windows users are about sophistication, quality and elegance. Cost is almost never an issue. You hear that Apple lemmings? Try looking past the price tag and maybe you'll discover some real innovation: Zune and Vista!

You Apple lemmings can have your crappy stores filled with second-rate, "me-too" garbage. Windows users demand better. They wouldn't be caught dead at an Apple Store.

Your potential. Our passion.

Good to see the point made that the stores expenses, or much of them at least, can be considered part of the advertising budget. Traditional advertising is damned expensive and there are better ways to achieve the same result provided that the product is decent. Of course most mass market companies take the opposite approach, cut the cost of the product and spend the difference on advertising. This is one of the factors that has caught up on Dell, they only sell through advertising.

Apple's stores are great for brand recognition. They are a great way to leverage Apple superior marketing skills. And the fact that the stores are doing so well is a testament to the popularity of the iPod, which has led to more recognition for the superior Mac OS.

However, these stores are not a great accomplishment on doing retail "right." A lot of the computers in the store consistently don't work and before the random shutdown syndrome problem was solved on the MacBook half the MacBooks in my local Apple Store were constantly shutting off. The tabletops are filthy, dusty and in desperate need of cleaning. The customer service at the store is very sub-par, not to mention the Mac Genius' being very sarcastic and condescending. The Apple Store is no different from any other retail store as far as customer service and presentation is concerned.

Everywhere you look, Apple is excelling.

Even those ill-informed reports that iTunes Store sales were taking a dip were not just wrong, but the exact opposite of the truth.

e.g. In the Amazon best-seller charts for ALL electronic products, the $25 iTunes Music card has either been the top-seller or, as it is now, second from top - behind the 2 GB Nano silver - for the last few days!

That's incredible!

Apple's going to have a bumper Christmas!

Zune Tang

I see Bill et al, have you under their spell. I guess Steve is not the only one with "reality distortion field"

Best o luck with your Vista, and your viruses, and your whole wintel world.

It might be nice for you to disclose just how much experience you have with the Mac, and specifically Mac OSX, to lead you to your conclusions. I would gather from your comments, not a lot.

si le gere, se la vie

What ever happened to that "big Times Square deal" M$ made last year?

MW: 2007: The [hopeful] fall of an empire- and a terrible one at that!

"Best of all shoppers can get their hands on the magnificent Zune..."

I heard they're slippery and keep popping out of your hand like a bar of wet soap.

"...or even try Windows Vista in an upscale environment."

The only place they'll be able to try it since most home users will need a new computer to go with the new operation system.

"Windows users are about sophistication, quality and elegance."

This sentence should read: "Windows users are clueless about sophistication, quality and elegance."

"Cost is almost never an issue."

Translation: The cheapest is always the best.

The previous Zune Tang was funny before the current imposter stold the handle and became a poor imitation of the original. Kinda like MS did with OSX.

"Big freakin' deal. Wait until Microsoft opens their boutiques. Microsoft's shops will cater to sophisticated, intelligent consumers who are woefully underserved by those dumps Apple calls stores. "

Waits for laugh track...

The sarcasm meter went haywire at about word six...

They make that kind of money per square foot... and they have the some of most spacious stores I've ever seen.

Zunee. Zunee, Zunee! Please! Remember "microsoftSF" at the Metreon in San Francisco? Of course, Microsoft closed it two years later...

Hey Mister 'Tang,

You forgot to mention that the Microsoft store sells its software on a plethora of hardware. It's all represented in the store even though it's just a bit too confusing to customers.

They've also included a Wizard Bar to answer folks questions about software security and explain how Vista makes it all better. It's easy. Just buy one of the dozens of computers on display.

Not all that confusing after all...

Another article with Rob Enderle quotes. That guy is everywhere.

Zune Tang is right on.

I'm all for the Apple stores, don't get me wrong. I got my Macbook Pro there. However, the sales per square foot leader moniker is a bit misleading. Apple has a limited product line, all of which takes up very little floorspace to sell. Plus, inventory is relatively easy to manage, or can be arranged for delivery if not immediately in stock. The advertising angle is huge, regardless of sales. I went to an Apple store 20 times before I bought my computer and played with ipods, macbooks, macbook pros, etc.. Plus, Apple stores are always in upscale centers. The walkthrough traffic is amazing. It suits the brand and strengthens it every new potential customer that walks through the door. It removes the "Techy" feeling of going to Best Buy or Fry's to buy something. However, no other computer manufacturer could get away with it. How many people would be inspired to walk into a Dell store?

Back to the article...

It seems ridiculous to compare sale per square foot between Apple and Best Buy. Best Buy is about bargains on a much wider variety of merchandise. Compare BB with Costco or Circuit City, not Apple Stores. The comparison with Gateway is more on target and even more impressive. I admit that when Apple first said it was going "brick and mortar" I thought they must be high. Gateway was just then beginning to tank, and the internet store for electronics seemed to be a foregone conclusion. As with MP3 players, Apple proved that it knows how to reinvent what we think we already know and show us quality and innovation can create all new opportunity and success. I'm glad to have been proved wrong!

Actually, I think it would be a wise long term investment to buy a Zune right now and keep it, unopned, as an investment. Fifty years from now it might bring a great price (along with the countless other MS flops) as a collectors item/museum piece.

Allen not sure what your point is about a limited product line... If you are referring to the fact that it is only computer related, I still think they swamp a CompUSA competitor. As for the stores being located in "upscale centers" this is just not true. I have been to many locations across the country and most of them have been in your every day mall.

I must agrees with everything else that you wrote. I feel so sorry for the Dell sales people at the Kiosk just down the mall from our local Apple Store (Knoxville, TN). People go by look at the Dells and are told that they will have to wait for their order to be built and shipped. All the while people are walking buy taking their new Macs home to use right away...

Hey, very true about the Zune being a collectable. They are going to hit the trash bins and/or ebay auctions in large numbers about a month or so after Christmas. Every ebay Zune buyer will become an ebay Zune seller within a month of his original purchase. At some point they will be so cheap on ebay that it won't pay for the auction add to sell them so the dumpster is the only place left. They will become scarce within a year. If you can pull a brand new one out of storage, still in it original package 50 years from now it will be worth a lot!

People will always pay for quality. There rivals sell crap.

I just got back 5 min ago from my local mall. There is an extremely busy Apple Store and a little Hell kiosk next the Sears. The Hell kiosk looks so pathetic with a couple of stragglers milling around it, I almost feel sorry for Michael Hell - almost. Best Buys numbers would be even worse if it weren't for the windfall profits from unpaid rebates!



Rock on Steve!

Candy store for geeks? What does that even mean? That Apple makes fluffy computers that aren't serious machines?

And out of all the computer stores out there, Apple's customers are the least geekiest... I see grandparents and couples and kids all in there asking about photos and music and video making.... Certainly not typical geeks.

Guess it's just a case of bad writing...

"The previous Zune Tang was funny before the current imposter stold the handle and became a poor imitation of the original."

I'm pretty sure there's more than one impostor.

The Apple stores that I have been in around the LA area are all clean, the displays work and the staff seems polite enough. There isn't enough staff however. I find that I usually have to wait patiently for a previous customer to ask tons of questions, and get tons of answers before I can get some attention.

I suppose that this is good, the customers end up informed, one way or the other.

Has your wife ever cringed at the thought of going into Best Buy?
"I'll wait in the car, thanks."
Kudos to Apple for creating a store for both men AND women.

Zune Tang,
Please never go away. I really enjoy your posts. I am a die-hard Apple fan, and I thoroughly enjoy every word of your posts. Please keep up the good work.
Jeff

ignore that last post by the imposter ZT!

I'M the real Zune Tang... no question about it. I just checked the name on my underpants.

Zune Tang,
Can you say "brown 3rd party conglomerate vaporware boutique"??

You're hanging out here alot. I think you have a crush
on the Mac.

Can you say "denial troll envy"??

Seen one Zune Tang, you've seen 'em all. Honestly, I can't tell the difference, they're all uncompromisingly repetitive and monotonous. It’s the same mental vomit regurgitated every week.

Gone are the days of dusty Performas stuck in the back of Best Buy, with salesmen who had no idea why they were there. They didn't really SELL macs in those stores. I'm sure that there was usually nothing you could ask the salesmen that would result in them recommending a Mac.

I bet some of those guys wish they had macs to sell now!

What! You mean stores having cluttered shelves with no room to walk, displays that don't work, and no knowledgeable person to help can't outsell Apple's stores?

Sounds like the supermarket I go to, or Fry's.

Analysts are always eager to praise or bash the vaunted "iPod Halo Effect" but in reality, Apple has probably gained as much traction with in areas it has it's own stores. The experience is second to none, and after three visits inquiring about a Mac, most PC users switch.

This has little to do with iPod, and a lot to do with Apple marketing as a whole.

Damn. Zune Tang is starting to sound too bitter to be as funny as before. I hope he's OK.

Maybe MS should open a store.
<tumbleweed> It would only need two shelves for each package of Office, XP and Visio. No PC hardware (too ugly) and no developers software (they're competitors). All ten of their mice/keyboards and an XBox on the second shelf. </tumbleweed>

But there would be an empty Vista box saying "coming in January - pleeeeze wait and don't buy a Mac".

The telling statistic is that the "average" 6000 sq foot Apple store generates 2/3rds of the revenue of an "average" 38,000 sq ft Best Buy.

So Apple wins on sales per square foot, but Best Buy wins on sales per store.

So which would you rather have? A compact store, or more money?

Sales,

The margins at best buy are super thin compared to Apple. Best Buy requires short inventory turn times to generate profits, like a supermarket. So, Apple requires less inputs to generate nearly as much revenue. It's not just about the money you make, but it's about how much it costs you to make it. As far as the comment above in reference to Apple stores. Most of them are in upscale shopping centers, not next hunkered down in strip malls next to Radio Shack. At least in Los Angeles, you're more likely to see an Apple Store next to J. Crew than Marshalls/Ross/etc.. I don't know what Apple's strategy is outside the West Coast, but it's specifically geared towards attracting high dollar clients walking by, not bargain shoppers looking for a deal.

Why is everyone making fun of my Dad?

Don't you know I've suffered enough as the illegitimate offspring of Zune Tang?

All those kids in school laughing at me...belittling me... Those cool kids with their Macbooks andf iPods... making fun of my Zune and my HP purchased from the cluttered aisles of Office Depot.... I hate you all!

Daddy, please come home.... You need to feed, clothe & house Mommy & me...

Do you think MDN will finally announce the 2 new games for the iPod today? A day Later than everyother mac site.

They beat Best Buy by not sucking. By not hiring a bunch of retards.

/they hire more retards now though

"Sales" seems to get it all wrong.... When he states "So which would you rather have a compact store or more money?"

This is not necessarily a valid question...

The biggest cost in retail is the lease/rent. Although Best Buy tends to be in more downscale strip malls, rent on a 38,000 square foot facility has still gotta be BIG...

Even if Apple is spending more per sq.ft. for being in a mall, I doubt it is that much more to make up for the cost difference due to the size of the respective stores... Factor in that Apple is able to generate 2/3 the sales revenue at HIGHER MARGINS in a much SMALLER space and I'd much rather be in Apple's shoes....

I think 'Sales' uses way too a simplistic approach to analyzing the data...

"I think 'Sales' uses way too a simplistic approach to analyzing the data..."

I'd agree with that, but comment that also looking at sales per square foot is also too simplistic a way to evaluate any company.

In short, Best Buy's total revenue is about one and a half times Apple's. Best Buy's margins are about half Apple's. Best Buy's shares cost about 5/8ths of what Apple's do, and there are just over half as many outstanding. So when you slice and dice all of that, Best Buy and Apple generate about the same amount of free cash flow per share, and their accounting profits per share are the same. In that scenario, the only reason to buy Apple is an expectation of significant growth in Apple's free cash flow.

Will that growth pan out? That's the big question. the iPod may produce good unit sales numbers this quarter but most of the volume will be in shuffles and nanos. These are exactly the products which offer the customer no more functionality then an mp3 phone can, so Apple's very vulnerable there. My guess is that with shifts in the mp3 market it'll be all downhill in 2007 in terms of profit generated by iPods. Likewise Mac sales will ratchet up to a new level given it's new Intel underpinnings and Windows compatibility, but that's also likely to be a period of quick growth followed by a tapering off in growth.

So would I rather be in Apple's or Best Buy's shoes? Well they're quite different shoes. I'd certainly say Best Buy is in a less vulnerable position than Apple. Conversely Apple has a much greater potential for growth (positive or negative).

"Even those ill-informed reports that iTunes Store sales were taking a dip were not just wrong, but the exact opposite of the truth. "

Actually that's not true. What was stated was that the seasonal dip this year from Jan to June was much greater than the seasonal dip last year. That much seems to be true. Start of a Trend? Who knows (except Apple, and they don't give investors that information).

Jan 07, 08 - 01:10 pm Comment from: SodaMonk

Hi my friend wants to buy a macbook, is there much of a price difference when buying from Best Buy or the Apple Store?