Microsoft Will Gamble Big on Retail Stores
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Microsoft really meant to keep details of its upcoming retail stores under wraps, and for good reason: A veil of secrecy builds anticipation, which, as Apple learned with the iPhone, is a force powerful enough to actually send otherwise-rational human beings lusting for a device locked to AT&T. That is to say, a force that will move mountains and boost revenue streams into the stratosphere. Then someone leaked a 140-slide PowerPoint document to Gizmodo, dated July 7 and detailing some early concepts for the Microsoft retail experience, and the cat was officially out of the bag. The concepts were assembled by a consulting company, Lippincott, which has other clients in the retail sector that include McDonald's, Sonic Drive-In and Wal-Mart. As the slides show, however, some of the ideas seem reminiscent of the Apple Store. The most notable of these is the Answers Bar or Guru Bar (the name varies from slide to slide), which bears a resemblance to Apple's Genius Bar. One slide displays a floor plan with an Event/Partner Space, again evocative of the space you find in some Apple stores.
Many of the other concepts suggest that Lippincott drew inspiration from retail outlets such as the Nike Store: distinctive-looking shopping bags, walls and tables lined with products, specialized kiosks highlighting certain items, and so on.
Some of the concepts are decidedly unique, including a "Personalization stage area" where the customer can "configure ... PC hardware and software based on interest and preference" and "purchase laptop decals that are printed in the store from a wide selection of styles." In that same vein, one of the early-concept slides listed the possibility of the Microsoft stores hosting birthday parties. It's the very definition of an "out of the box" concept, and it had me wondering: What sort of mascot could Microsoft use, Ronald McDonald-style, to host such an event? The first (actually, only) one that comes to mind is Master Chief from the "Halo" games, but I'm not sure how many parents would approve of their tyke's birthday being presided over by a video game character who, if he had an online dating profile, would probably list his interests as "long walks on the beach," "classic rock" and "bloodily perforating dozens of Covenant Hunters with a high-velocity Battle Rifle." One of the most interesting pieces of the PowerPoint presentation, however, are the "Competitive benchmarking" slides, in which Lippincott conducted a deep-drill analysis of Nokia's, Sony's and Apple's retail stores to see what worked. But Microsoft's goals seem to be larger than selling more copies of Windows 7 or hardware accessories; according to one slide, the store's goals include "[providing] a transformative customer experience, [shifting] current perceptions of the brand and [supporting] the functional operating requirements of business groups." Yes, Microsoft is serious about this, just like it was serious about the June launch of Bing, its new search engine backed by $80 million to $100 million of media campaigning. Unlike Zune, its would-be competitor to the iPod that has been allowed to quietly yellow on the vine, a retail foray requires an infrastructure commitment that suggests Microsoft will make a sustained effort to penetrate the market. During the Worldwide Partner Conference in New Orleans, Microsoft Chief Operating Officer Kevin Turner said the company was "on the offensive" and would "take some of these hard market-share opportunities head-on." During the conference, Microsoft suggested that some of its stores would be opened near Apple stores; afterward, it announced the hiring of George Blankenship, a former Apple executive who helped launch Apple's retail outlets in 2001, to help with placement for its own stores. Microsoft has also tapped David Porter, once a top Wal-Mart executive, to head the retail division. "Microsoft's trying to put their brand in front of the consumer," Stephen Baker, an analyst with the NPD Group, said in an interview. "They're going as a technology place, where a lot of different Microsoft technologies come together to provide the consumer with an experience." Whether Microsoft takes aim at Apple's high-end market or tries, in the spirit of its "Laptop Hunter" ads, to appeal more to a cost-conscious demographic, the stores will likely evolve several times after their autumn launch. "The first Apple store looks pretty similar to how it did eight years ago," Baker said. "But there are still a lot of tweaks compared to when it first opened. Retail 1.0 teaches you that there are always two or three iterations coming down the pipe. There are going to be hits and misses." Microsoft will be hoping for a hit. |




Comments (3)
There's no way micro$oft can compete with apple on this front.
Posted by johndeere | July 29, 2009 11:48 AM
Since MS is basically not a "hardware" manufacturer, its hard to see how MS will make a profit in these stores. My guess is that if MS does not bounce back upright from these last two very bad quarters, is that in a years time the stores will be cut.
Since MS is basically a software company, and mostly the public buys Windows by way of buying a new computer, OEM, I do not see them with a viable store. Sure they do make some hardware, XBox360, Zune (big seller LOL in 3rd place behind Scandisk), and keyboards/Mice, but is this enough to base public stores on? Could save them some money if they make the stores return points for faulty XBox360 with its high failure rates, shipping out those boxes, could save them a lot of shipping charges.
@Nicholas Kolakowski, so far I have enjoyed your articles. But two questions, is everyone who submits a comment having it held for review, or is it just me? If so could you please get that fixed? Thanks.
Posted by Chips B Malroy | July 31, 2009 4:22 PM
I have a strong feeling that more and more multimedia retail store would be in this mainstream.
Signature: Telling stories with right storyboarding presentation together with PowerPoint presentation is like owning a printing press and printing your own currency.
Posted by storyboarding | August 3, 2009 11:52 PM