So you want to be a retailer? Microsoft gets in the game

Come fall, Microsoft plans to open stores, right next door to Apple's. It's like an "I'm a Mac, I'm a PC" commercial come to life.

I don't know what Microsoft's odds of success are. I was skeptical of Apple's stores, but it defied some pretty steep odds. Apple stores today are thriving enterprises.

Apple's plan from the beginning went against common sense. Pick high traffic, highly visible, high-rent locations. Go with pricey, incredibly slick designs like glass staircases and clear cube entryways. And include free services such as classes with purchase and a Genius Bar, a name some find a tad elitist. But then, some find the use of the term "a tad" elitist too.

Mostly, I found Apple's stated goal of using retail locations to increase household penetration of Macs to be overly optimistic. Macs were adored by many but for years, owned by just around 5% of the U.S. population. Opening stores (and launching that ill-fated "switch" campaign) seemed a difficult path to increasing market share.


I was only sort of wrong. For the first two years, Apple refused to break out the performance for the retail division. But then the iPod took off and so did sales. It took a lot longer for Mac computers to move up in market share, but today that stands around 7.5%, according to an independent firm. Thanks to the popularity of the iPod and the iPhone, and the stores being there to supply the entire eco-system of products that work so well together.

Can Microsoft do all that? They hired a retailer to help, David Porter, from Wal-Mart. Similarly, Ron Johnson came from Target to launch Apple's retail program. Both are discounters but with very different customers and strategies. Target puts temporary or pop up stores in ritzy locations and gets raves from upper-income shoppers. Wal-Mart? Not so much. Then again, neither does Microsoft.

But this is about Apple and Microsoft, and their retail stores. Let the games begin.

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