Transfer Pricing Associates

Apple Store Regulations: Building Profit

post Monday February 27, 2012


Apple’s 2001 decision to begin opening company owned retail stores made it clear that the company was seeking greater control over its retail sales and marketing process. This started from the decline in marketing efforts at non-Apple sanctioned stores like Sears and Best Buy chains. A main goal of the new retail endeavor was to bring new customers into the store and expand its current customer base through diversifying sales. Apple hoped the stores provide a forum in which the Company is able to present computing solutions to users in areas such as digital photography, digital video, music, children’s software, and home and small business computing.

The company currently has over 350 stores in countries like Japan, Canada, the UK, Italy, Australia, China, France, Spain, Germany and Switzerland, and have continued plans to increase stores yearly. Apple's overall market share has reportedly increased since the retail stores have opened, perhaps beyond six percent. Apple now reports that "new to Mac" sales through the retail stores now is more than 50 percent, probably mostly Windows users.

Of the two types of Apple stores, street facing and inside mall, there were key indicators for successful stores, as defined by Steve Jobs in 2001.

Apple’s success didn’t come cheaply, the data service to one store alone, reaches past $5,000 monthly. Apple stores are usually in the same mall as, or in the neighborhood of a standard set of stores, including: Gap, Abercrombie-Fitch, Pottery Barn, Williams-Sonoma, J. Jill, J. Crew, The Walking Company, Banana Republic, and Victoria's Secret.

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