In Phil Schiller's Macworld keynote, he stated that 3.4 million was
the number of retail visitors per week. Assuming this was the average
for the last quarter and not the best week, there were 44.2 million
customer visits.
Update: In the conference call covering the December quarter, Apple
CFO Peter Oppenheimer, said that the retail stores had 46.7 million
visits. This averages at 3.6 million visits per week, not the
3.4 million given in the Phil Schiller keynote. With this new average,
per store visits were nearly the same as the September quarter.
Apple Financial Results (chart adapted from ifoAppleStore.com)
While this total is up slightly on the September quarter's record
42.7 million, the average number of stores open is also up 10%. This
means the average store has had about 800 fewer visits per week in a
quarter when visits in previous years have gone up - from 3% in 2005 to
over 30% in 2007. However, visits are still up by over 1,000 per week
from the December quarter in 2007 and up over 40% from 2006 and
2005.
Foot Traffic Down
Foot traffic is down everywhere, so many of these "lost visits" may
be passersby who wanted to check email and compare online and retail
prices. At the end of the quarter, I twice went to the Regent Street,
London store. Both times I was able to get on a MacBook whenever I
wanted. This has never happened before.
However, 6 to 8 staff were kept busy ringing up purchases, so short
term sales may not be affected. Square, the Apple Premium Reseller in
New Oxford Street, also had a queue of buyers.
In the longer term, the more people who use Macs regularly, the more
people will buy them. Switchers buy 50% of Macs sold in Apple Retail,
according to Peter Oppenheimer, Apple's CFO. At the average price,
those sales generated $450 million last quarter out of total sales of
$1.72 billion, so Apple needs to keep attracting them to keep retail
highly profitable - as well as expand market share.
Microsoft's chart showing the "Apple tax".
It takes a long time to shift perceptions. "Macs are overpriced" is
still burnt into many people's subconscious. This is one reason why
Microsoft is trying to push the idea of an Apple tax.
Another is the difficulty in explaining why, according to NPD, when
US consumers choose a $1,000+ laptop, two-thirds of them buy Apple. In
other words, why similarly spec'd Windows laptops are worth less.
Switching Can Be a Slow Process
It often takes a long time to switch too. A friend who teaches at a
German university came to stay. As she always has music projects on the
side, Macs were a natural fit, but she had a PC. Her closest music
collaborator is Mac based and had talked of the advantages for years.
During previous visits, she had used one of our Macs, and after some
help preferred OS X. But it was only when her 6-year-old PC was
dying that she was really prepared to look at alternatives.
She then found that all her programs were available and happily
switched, transferring files with the help of the university support
desk. This combination of reluctance to change from what you have spent
a lot of time learning and needing to make sure of what support is
available, is common. This is why Apple Retail needs motivated staff to
help possible switchers get used to OS X and to make them feel
that Macs are worth paying a premium price for.
While cutting the hours of part timers at this time of year is
standard for retail, there will be much more unease if what are seen as
permanent positions are cut. If Apple can boost the foot traffic and
keep the stores busy, it will be a lot easier for the staff to stay
motivated even when there's less happening in the surrounding
stores.
Appi Hour
So why not an "appi hour"? With the large number of iPhone
developers, many stores will have a large enough group close-by to put
on a regular hour, say giving each developer 20 minutes to show off its
game or app. Developers complain on the lists about difficulties in
getting enough exposure, so this would also be a "put up or shut up".
Any gaps in the program could be filled by staff picks. When people buy
an iPhone or iPod Touch let them know about it. Display the "appi hour"
details at the Genius Bar, in the store, storefront, and on the website
so people can see what is happening when.
Whenever bands are featured in a store, look to stream the
performance to other stores and replay the performances wherever there
are theatres. This would be a very effective way of starting and
publicising tours and new records. Copies of the performance could also
be made available through iTunes.
As well as adding to the visitor numbers, this would strengthen the
ties between musicians and Apple.
The news from the retail sector has been mainly bad, and electronics
resellers like Best Buy have suffered, but Apple has ways of expanding
it's business not available to others.
We'll know much more about how well Apple Retail is weathering the
depression after the conference call on Jan. 21.
