By Rick Moss
There are parallels that can be drawn between Finland-based Nokia, the world's leading mobile phone manufacturer, and the darling of U.S. consumer electronic chic, Apple Computer. Both companies finely polish their brand image with daringly innovative products and exploration of the "bleeding edge" of personalized, multi-media consumer experience. Now, it appears the Apple doesn't fall far from the tree as Nokia released news that the first of four U.S. retail locations will open on Chicago's "Magnificent Mile."
The announcement yesterday coincided with Nokia's introduction of five new phone models that includes what is billed as the least expensive 3G phone on the market, giving consumers access to the new high-speed wireless networks for about $56 U.S. The strategy here, for Nokia, is to provide a low-cost point of entry to draw consumers into the world of mobile content that's now being created for these networks. And, from Nokia's advance description, their new retail environments are being designed to immerse current and future customers in this world of interconnectedness in gleaming, stylish, experiential fashion.
According to a company release, Nokia's Chicago Flagship store will elevate the mundane and often confusing task of phone-buying to "the kind of pleasurable shopping experience normally associated with exclusive upscale boutiques." Customers will be introduced to Nokia products via dramatic multimedia displays in a sort of sensory-intensive, interactive setting, with personalized demonstrations of global connectivity.
The company's excitement is palpable in its description: "These displays interactively walk guests through the features and benefits of a wide range of Nokia products and even allow them to send text messages that can then be seen on not only the local store displays, but in other Nokia Flagship Store locations around the world."
Why such a splashy debut? Although number one in worldwide sales, Nokia apparently suffers from a bit of an inferiority complex in the States due to its second place status here after Motorola. Many see rough going for Nokia, however, because in the U.S. not as many customers are used to paying full price for phones. Most buy the devices at a greatly reduced initial cost as part of a service provider package. Nokia is banking on its ability to sell full priced product by wowing consumers with an in-store experience, while boosting its brand image in the process.
But, according to the company, this is far from a simple marketing ploy. "There is a business model behind it," said Nokia retail strategist Cliff Crosbie. "Retail is one of the biggest medias now. Stores are essential if you want to communicate directly with consumers." And, yes, Crosbie pointed to Apple and Nike as direct-to-consumer brands that have served as guiding lights.
Moderator's Comment: Will the new in-store environments being designed by the likes of Nokia and Apple force traditional CE retailers to counter with heightened consumer experiences of their own?
Brand retailers like Nike, Apple and Nokia have a huge advantage when it comes to creating an in-store experience. First of all, they're able to more easily create a unified merchandising presentation, since packaging and product design is already coordinated. Stack that up against the challenge of a consumer electronics superstore that must find ways to tie together the visual cacophony of styles, logos, fonts and photographic images that adorn packaging.
Secondly, when well executed, there's a unity of marketing strategy and logistics with the one-brand retailers, so that advertising, online efforts and in-store activities coordinate well. (Not as easy when you're working with hundreds of vendors at a time.)
Of course, when it comes to sales volume potential, we're talking apples and oranges. But given the experiential punch this new wave of stores will expose shoppers to, multi-vendor retailers may consider store-within-a-store boutiques that are brand-centric and could give them a chance to compete on an emotional level, as opposed to strictly a price level. - Rick Moss - Moderator