Christmas in the Apple Store

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We’ll have no way of knowing until Apple unveils its first-quarter figures sometime next month, but if I had to take a guess, I’d say it was probably a very merry Christmas for Apple this year. And by “very merry,” of course, I mean “very lucrative,” which, for accounting types, is pretty much the same thing. We’re talking a convoy of dump trucks descending upon One Infinite Loop to drop off huge stacks of cash at Steve Jobs’ feet, a vault filled with dollar bills and loose coins with Apple executives jumping in and shouting “Whee!”— that kind of merry Christmas.

The evidence for this conclusion? This holiday season, I had reason to visit three separate Apple Stores on three separate occasions—the San Francisco store to buy blank CDs for a holiday-themed project, the store at the Santa Monica Promenade to buy my wife a 1.2GHz iBook G4, and the flagship Apple Store at The Grove in Los Angeles when it turned out the Santa Monica store was all out of iBooks. And all three stores were packed with people from the moment I walked in until the moment I left. And I’m not talking about window-shopping lookie-loos, either—the folks who come into a store just to kick the tires and smudge the merchandise before skulking off to the Hot Dog-On-A-Stick stand elsewhere in the mall. The people I saw at each Apple Store had merchandise in one hand and U.S. legal tender in the other. These people were here to buy, not just to gape. Thus, my belief that Apple executives won’t have to worry about clipping coupons at the dawn of 2005.

A few random thoughts stemming from my December 2004 World Tour of the Apple Stores of the Pacific Coast:

• Back in 2001, when Apple opened the first of its stores in Glendale, California, and McLean, Virginia (I’ve been to both of those, too), critics of the retail strategy didn’t see brick-and-mortar stores as a good move for either the company or Mac shoppers. Their complaint: Apple wouldn’t be able to offer a wide enough array of peripherals, add-ons, and software to satisfy consumers, and with other retailers pushed out of the spotlight by Apple, shoppers would have fewer sources for Mac merchandise. One particularly bold analyst I talked to way back when even predicted that the last of the Apple Stores would shutter within two years.

Well, that prediction clearly didn’t pan out. In fact, in the fourth-quarter, Apple reported $376 million in revenue from its stores—a 95 percent year-over-year increase. And with 7.8 million people visiting a store during that the three-month period, it’s safe to say that one of the main goals behind the Apple Store—increase the visibility of the Mac brand—is being met, repeatedly and ridiculously.

But the stores are also proving to be a winning proposition for Mac users, at least if my experience at the Santa Monica store is any indication. As I said, I went in to pick up an iBook for my wife, but the laptop cupboard was bare. Faced with the grim prospect of my wife waking up Christmas morning to an empty box where her iBook should be, I began to contemplate my options.

“I wonder if the Apple Store in The Grove might have an iBook in stock,” I mused out loud.

“Probably,” replied the clerk who had delivered the bad news about the iBook scarcity plaguing Santa Monica. “I can call and find out for you.”

And so he did. Which is why, about an hour later—Los Angeles traffic is the enemy of speedy Christmas shopping—I was walking out of the Apple Store at The Grove with a brand spanking new iBook.

Most store employees would have informed me that they were out of what I was shopping for and sent me on my less-than-merry way. This particular clerk at this particular Apple Store took the time to help me track down my purchase. Yes, I probably would have driven out to The Grove on my own, but thanks to that clerk’s help, I could brave the traffic on Interstate 10 with the knowledge that I wouldn’t show up at another Apple Store only to find out they were fresh out of iBooks, too.

A good selection of Mac merchandise and conscientious employees that help you find it—that sounds like a rewarding retail experience to me.

• By now, it's not exactly breaking news to suggest that the iPod is a big deal for Apple. After all, the company sold 2 million of the darn things last quarter, compared to 836,000 Macs. And just in case you need a refresher on all things iPod, Chris Breen provides an excellent recap of the iPod’s very big 2004.

But even after glancing at sales figures and reading news stories, you don’t actually grasp how big a deal the iPod is, until you wander into an Apple Store and watch other customers make a beeline toward the music player. I reckon that between my visits to the stores in Santa Monica and Los Angeles, I spent anywhere from a half-hour to 45 minutes in the Apple retail bubble. And in that time, I saw exactly one person—me—buy a computer, a couple of three printers change hands, and maybe some software purchases here and there. Everyone else was buying an iPod, a mini, or some sort of music-player-related paraphernalia.

This is not to suggest that Apple is going to abandon the personal computer business any time soon or that the Mac is about to join the Lisa in that landfill out in Utah. But it is time to stop thinking of Apple’s dalliance in digital music as some sort of side project. The iPod, the iTunes Music Store, and whatever else Apple has up its sleeve music-wise make up an entirely separate business for the company, every bit as important to its long-term fortunes as the Mac.

• The last time I checked, no one hands out Nobel Prizes to recognize achievements in retail, like they do with physics, literature, and other lesser pursuits. But if they did, whichever Apple executive came up with the idea of prepaid gift cards for the iTunes Music Store should be polishing his or her acceptance speech for the inevitable award ceremony in Stockholm.

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