Apple last week announced plans to open 40 to 50 new retail locations in 2010 with a focus on larger, flashy flagships in major cities as part of a new "significant stores" strategy.
"Our stores are too small," Ron Johnson, Apple's senior vice president of retail, told The Wall Street Journal at the opening of Apple's fourth store in Manhattan on the Upper West Side. "Our biggest challenge at the Genius Bar -- we cannot build them big enough."
Representing its bigger store strategy, the store at Broadway and 67th Street is the first time an Apple store has had a roof made entirely of glass - one supported by 45-foot marble walls that reflect sunlight. A glass spiral staircase leads to a lower level featuring a 45-foot Genius Bar spanning the entire length of the wall. It houses more Apple products than any other store in the world as well as the company's largest training and support area. The service area can accommodate up to 100 customers at any time. There will also be events at this store, particularly free workshops aimed at those under the age of 25.
Like-minded stores in the "significant stores" strategy, according to Mr. Johnson, include its glass cube on Fifth Avenue and its just-opened, first store in France beneath the Louvre museum in Paris.
"Other retailers call them flagship stores. We don't use that word," Mr. Johnson said. More "significant stores" will open in London, Paris and Shanghai in the spring or early summer next year, he said.
More than half of Apple's 40 to 50 new retail locations in 2010 will be outside the U.S., including the United Kingdom, Canada, Australia, Italy, Switzerland, Germany, France and China, he said.
Charlie Wolf, a Needham analyst, told the Journal he suspects the major focus on its "significant store" strategy will be international, particularly Europe and Asia where it has less store penetration than the U.S. Mr. Wolf added that the retail stores create a "halo effect" by attracting customers to more Apple products. "Stores have been the Trojan horses for Apple," he said.
Apple said it doesn't have any plans to put a fifth store in Manhattan but when asked about a first store in Brooklyn, Mr. Johnson said, "Stay tuned!"
Apple opened its first store in 2001 and now has 280 worldwide.
Discussion Questions: What do you think of Apple's new focus on "significant stores"? What are the pros and cons of focusing on showcase stores as Apple is doing? At what point do you worry about Apple opening too many stores?