Apple doubles sales per sq ft of next closest, Tiffany’s again. In the Apple Stores, Apple is building its image as the most service-oriented company in the computer and consumer electronics industries.
On the 26th June, an interesting article appeared in the online publication Technology Spectator by Horace Dediu from the Helsinki based company Asymco. It was about “Expanding Apple’s Retail Army“, specifically about Apple’s retail store staffing practices. The full article is available by clicking here
The basic premise from the article is that Apple has in the last 5 years tripled the number of employees per retail store from 37 in Q1 2007 to 117 in Q1 2012 and yet still retains extremely high per employee profitability and sales. See the graph below:
Apple has also set the benchmark for retail in terms of sales and profit per square foot (more than double 2nd placed Tiffany’s) as well as sales and profit per employee. Last year in Apple’s 327 stores globally each Apple retail store employee brought in $473,000.
The products are desirable and the staff are astonishingly good at selling them (even though they are not on commission). There have been some rumblings about staff wage levels and staff retention in the US, however there is always a plentiful supply of bright young people lining up to apply for jobs at Apple stores – they can still take their pick of the best. Why is this?
I think it has a lot to do with the strong Apple brand and the consistency of the customer experience with Apple products; whether that is online, in store or when they get home an unbox the latest iPhone or iPad. A consistently great experiences.
Store staff are well trained and empowered to solve customer problems straight away, they have access to all the information they need on their iPod Touch or iPad and their store retail application is well integrated with their website including their Genius Bar booking system. Apple are even taking this a step further with their Apple Store iPhone app where customers can go into a store and buy a (admittedly a lower price point) product and pay for it with their iTunes account using their iPhone and walk out – without the need to even interact with any Apple Store staff.
Recently Apple’s new head of Retail John Browett, who took the reins in April, was looking at tinkering (read reducing) with Apple’s store staffing levels, using new schedules and staffing formulas. However this was quickly hit on the head (most likely by CEO Tim Cook), with Browett coming out and saying that “We messed up”.
With all the doom and gloom about retail and retail store staff employment prospects – Apple is showing the way by increasing store staffing levels. In difficult retail conditions Apple is still setting a stellar example for retailers to follow:
- It’s all about the brand and a consistently good customer experience
- Stores are well staffed by well trained, engaged and motivated employees
- Store staff are empowered to solve the customers problem there and then
- Store staff have the mobile tools and information they need on the floor
- Online and in-store systems are consistent and well integrated
- Customers are given all the information they need in store on their iPhone or iPad