Former Apple retail chief: Only 1 in 100 Apple store visitors actually buys...

According to a new interview reported in Cnet.com, "The Apple store's a place to be," Ron Johnson said. Not a place to shop, a place to be, in a redefinition of shopping experience....

(Ron Johnson was brought in from Target to set up the Apple store, 'giving reasons to visit and figuring out how to create more intimacy, relationship and experience in stores, but it does not mean you have to buy...')

Yet 'rule-breaker' Apple  is usually the busiest shop in the shopping centre, and generates annual sales per sq. ft. of £2,654 compared with £1,100 for UK mults...

(See the full 50 minute interview at Stanford Graduate School of Business on YouTube)

Simply food-for-thought in classic grocery retailing?

Or a fundamental challenge to our assumptions re collaboration with retailers in connecting with a brand via the in-store experience?

Premier Foods - joining up the dots in retrospect...

As you may remember, as long ago as the 5th October 2012, KamBlog analysed Premier Foods options and advised you to watch this space to see the dots joining up in retrospect… (Steve Jobs warned that you can't connect the dots in life by going forwards, it's only in retrospect that you begin to make sense of the bigger picture..)

Walking away from a £75m bread contract
Premier Foods’ decision not to renew their £75m own label bread contract with one of the major mults is all part of a move to reassess each part of its business and sell/walk-away when the figures don’t add up. This in turn is driven by a need to drive up the share price by improving its Return On Capital Employed (see KamBlog – Premier Foods).

Next moves
In a low margin, high overhead category, Premier now have to place the £75m with another mult on better terms, or suffer an increased overhead burden, probably resulting in sell-off of bread-related assets to restore profitability.

Meanwhile, by demonstrating  their willingness to walk away from unprofitable deals with retailers, Premier have done a favour for other suppliers, besides causing their share price to rise 4¾ - 6pc - to 83½p, yesterday.. voila!

Going back to the future
The key idea here is that these moves were obvious on the 5th October, to those NAMs that were prepared to explore the greater business context, and then attempt to anticipate the implications for their category and customer relationship. Running the what-if numbers then reveals the urgency…

As Steve Jobs proved many times, by using historical dot-joining to establish the big picture (including the numbers) he was able to anticipate future consumer needs and design accordingly…

Apple’s resulting output provides the evidence all around you...

Google, Amazon, Apple and Facebook - the new big four in retail...

We shop on phones, compare on Google and ask our Twitter-mates what they think. Even more importantly, we also have the ability to complain to 100 friends when a supplier/retailer misses our expectation…
This revolution in shopping behaviour is causing traditional retailers and suppliers to play catchup with multichannel marketing, or else…

Whilst historical purchase data reveals what we bought, social media reveals why and indicates the future. Think about it, we have been waiting 30 years for this insight…now we have it, are we doing enough?

The real opportunity
In fact, do we accept that the real  breakthrough hinges on the willingness and ability of the retailer to respond accordingly. For suppliers, the key issue is whether it is easier for traditional retailers to remodel the business based upon shopper-need, or for the new big four to fulfil the shopping transaction, profitably.

When I break from writing this KamBlog post to accept delivery of the Amazon book I ordered yesterday, at a 15% discount, while hesitating to drive to the nearest Tesco for a bottle of breakfast milk, somehow the answer suggests itself…

Just the first layer?
The multichannel e-commerce combination is obviously making it easier to buy, but I believe that as suppliers we are simply skimming off the first layer…

The real pay-off will result from re-engineering the entire brand offering to better meet consumer-shopper need, arriving at a minimal compromise between what a consumer is trying to tell us they require and our ability to provide the solution, better than the available competition.. In other words, building trust by delivering more than it says on the tin…always.

What this means for NAMs
This process includes adjusting our channel strategies to optimise their strengths, via NAMs that have the imagination to see that the accounts with real career-potential are the new retailers in emerging e-channels.
Sure, making real change in uncertain times is an uphill struggle, especially having to negotiate more with your own colleagues than with the customer.

However, given that we learn more from risk, mistakes, uncertainty and overcoming resistance (a buying signal?), numbers-based NAMs that are prepared to swim against the tide somehow move faster...

Touch but don't press - How daily Apples have become unhealthy for the competition

Latest figures from Kantar Worldpanel reveal that in the UK, more than one in seven people now have a tablet in their household and over 52% of the population own a smartphone. Couple this global realisation that tapping keys have become increasingly out-of-tune with consumer intuition and it can be seen why Apple have forced Microsoft, Blackberry and Nokia into catch-up mode…forever in pursuit of Apple’s innovator advantage.
In other words, Apple have made ‘screen-touching’ the only future…

A touching retail experience
Add to this the escalating success of Apple’s retail outlets, and it can be seen that the company is successfully applying the same fundamental creativity to retailing by populating its outlets with non-virtual Apple people! In fact, over the past five years, the company created 35,852 retail jobs, all acting as representatives for one of the best known brands in the world, optimising their unique combination of retail plus online plus a daily dialogue with enthusiastic users that few tech companies can duplicate.
In practice, their stores are more about being the front line for Apple advertising, rather than a ‘normal’ retail experience.

Helping people buy...
However, this experience of the ultra-softsell, in an open-table environment littered with products in constant use by enthusiastic shoppers, and continual access to human advice, can be addictive. In fact, this tactile experience, coupled with the realisation that the price cannot be bettered elsewhere, makes buying compulsive.
A frustrating lesson for ‘normal’ retailers everywhere….

Applying the Apple lessons to your business
Seth Godin extracts 10 iPad lessons to enhance your product launches, especially in niche markets.

Can you risk being out-of-touch in an Apple-free personal-corporate life balance that does not include a daily bite of the inevitapple?