Apple Stores Are Old News — And That’s Bad News for Rivals

Slipping sales suggest the format's novelty has worn off

   
Apple Stores Are Old News — And That’s Bad News for Rivals

Ah, remember when Ron Johnson was the head of Apple‘s (AAPL) retail operations?

Those sure were the good ol’ days … or at least, that’s what Johnson and the tech giant have to be thinking now.

Johnson, as you likely remember, left Apple for what became a disastrous stint at JCPenney (JCP). And now — although not necessarily because of Johnson’s departure — Apple’s once-innovative and popular retail locations are struggling as well.

Apple replaced Johnson with John Browett, who lasted a mere six months. Since then, the company has yet to find a replacement … and has found a pile of problems instead.

The big one: Apple Store sales fell for in the most recent quarter — the first time that has happened in four years, the Wall Street Journal recently reported. And although the retailer’s sales per square foot are still hardly anything to sneeze at, that metric suffered a 4%-plus decline as well.

While Kyle Russell at Business Insider focused on the fact that the cash-rich company cut its retail budget for pens and paper under Browett, the bigger-picture implications of Apple’s continuing struggles struck me the most. Namely, one of the reasons for Apple Stores’ struggles is simple: While Apple’s model was novel at first, it’s boring now.

From the WSJ:

“In 2001, Apple changed the retail game when it threw open the doors to the Apple Store’s sleek and bright, modern interiors—completely different from electronics warehouses of the day stuffed with accessories and cords. The stores were temples for all things Apple, and destinations for early adopters.

But today, just as Apple’s products have become ubiquitous, the format of its stores has become commonplace.”

Sure, that’s hardly good news for Apple, which has been under a microscope of late anyways. But more than that, it’s also bad news for the handful of tech rivals that followed Apple’s lead.

Just remember all these headlines:

If the format — not the brand — is the issue, that’s a problem.

The idea that Apple Stores were successful because they were so innovative, and are struggling because they’ve become old news, suggests that a copycat format from other tech names — be it full stores or mini-stores — could be greeted with shrugs.

Not something you want to hear if you’re trying to get some more oomph behind your own tech brand.

As of this writing, Alyssa Oursler did not hold a position in any of the aforementioned securities.


Article printed from InvestorPlace Media, http://investorplace.com/2013/08/apple-stores-are-old-news-and-thats-bad-news-for-other-tech-giants/.

©2014 InvestorPlace Media, LLC

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