In this guest post, my colleague, Kevin Leifer, explores Apple’s brick-and-mortar success, and how Amazon can learn from Apple’s success as it launches brick-and-mortar stores.
Amazon is stepping out into the world. The real world.
In November 2015, the online retail giant opened its very first brick-and-mortar bookstore. Apart from the strength of its brand, there are two reasons Amazon is betting on the store’s success.
First, a growing number of consumers—particularly millennials—favor print books and the act of buying them in physical stores.
Second, Amazon Kindle sales are in a slump. A brick-and-mortar store offers consumers the opportunity to try out the devices, with Amazon associates’ helpful input.
One store in Seattle is a novelty. It could easily become an attraction. But to take this concept nationwide? Talk about upping the ante.
That may be exactly what Amazon is doing. In fact, it’s rumored that the company is planning to open some 400 bookstores nationwide.
The Promise and Peril of Amazon’s New Venture
Today, more consumers’ searches begin on Amazon than on Google, and nearly half of U.S. households have Amazon Prime memberships. A personalized shopping experience and extraordinary ease of use have long been hallmarks of the Amazon brand.
Like its online customer experience, Amazon’s new retail space is driven by customer data and consumer-to-consumer reviews. Books are displayed according to reviews and purchase histories of Amazon’s Seattle-area customers. Prices are the same both in store and online.
These cross-channel consistencies bode well for Amazon. But brick and mortar is brand new territory. And success isn’t a forgone conclusion. In the past 20 years, nearly every major brick-and-mortar bookseller (Waldenbooks, B. Dalton, etc.) has caved to Barnes & Noble.
Can Amazon really pull this off?
Apple faced the same question back in 2001.
The Unlikely Success of the Apple Store
When Apple opened its first store 15 years ago near Washington, D.C., skeptics said it wouldn’t succeed.
Apple’s problem is it still believes the way to grow is serving caviar in a world that seems pretty content with cheese and crackers.
I give them two years before they’re turning out the lights on a very painful and expensive mistake.
How wrong the skeptics turned out to be. Today, Apple’s 650+ stores serve a million customers a day and generate more sales per square foot than any other retailer—despite the fact that retail foot traffic is down overall.
So why are Apple stores such a huge draw? Is it the cult appeal of the Apple brand? Stellar customer service? The physical environment itself?
It’s all of the above, and more.
To build a brick-and-mortar empire, Amazon must follow Apple’s example—i.e., reinvent the retail store.
Friendly, Knowledgeable, Engaged Staff
Apple Store employees provide a one-of-a-kind brand experience for both curious visitors and repeat customers. The Apple Store’s ultimate help desk, Genius Bar, is an appointment-only “concierge service” that troubleshoots and fixes devices and helps familiarize buyers with their new purchases. Apple “geniuses” also alert customers to new Apple products, and floating sales associates are always on hand and happy to explain features and answer questions.
Steve Jobs was meticulous about design aesthetics. He modeled the Apple Store after large public gathering spaces such as libraries—bright, expansive centers of learning and exploration. Apple stores are simple and transparent: lots of glass, lots of light, very little flair, and plenty of room to play with Apple gadgets.
A Focus on Experiences, Not Products
Back in 2004, Apple’s VP of retail said the company’s goal was not to make the Apple Store “about the product, but about a series of experiences that make it more than a store.” Apple has fully embraced and excelled at experience retailing, hosting in-store events such as kids’ day camps, live music, and expert presentations.
What’s in Store for Amazon’s Store(s)?
Both Amazon and Apple are disruptive innovators with huge market share and a devoted customer base. Both brands are willing to try new things, and they learn from their failures. But even for these industry goliaths, brick-and-mortar retail presents a unique set of challenges.
Will Amazon mimic Apple’s success? Will its bookstores become retail destinations? Please share your thoughts in the comments below.
Most retailers build locations. A select few, like Apple, create destinations. They drive customers to their stores, and they give them reasons to show up again and again.