Apple's Retail Growth Depends on European Expansion

Reader Tim McGuire pointed me at this thought-provoking article by David Sellers at MacsimumNews.com noting that Apple's (AAPL) upcoming launch of the iPhone in Europe is missing a crucial ingredient: a wealth of Apple retail stores. Unlike in the US, where Apple's 165+ stores were the places to buy an iPhone, Europe has exactly 11 Apple retail stores. Worse, 10 of those are sequestered in the United Kingdom -- the remaining store is in Milan, Italy -- and are therefore hard to reach for most European consumers. So if the iPhone is as big a phenomenon in Europe as it was in the US at launch, how is Apple going to serve continental European consumers? Are they expecting millions of them to line up outside the single continental Apple store in Milan? And how will they help European consumers when they invariably have problems with their phones?

Dennis raises more questions than he answers, but his point is excellent: Apple has turned its US retail operations into a stylish, profit engine, but the US is just one geography. And while Apple's concept of working through mobile phone partners in Europe is sound, it's not enough. As Apple learned with retailers like CompUSA and Best Buy, indirect retail sales move product, but they don't create the great and lasting consumer experience possible when one company is responsible for everything. So while deals with Orange, O2, and T-Mobile are a first step, Apple needs to do more.

Europe is already a more style-conscious and mobile phone-centric consumer base than the US and should represent a major focus for its future growth. When Apple first launched its retail stores in the US, it promised to open 25 of them that first year. Apple should set a similar goal of launching at least that many stores in Europe in 2008. More consumers live outside the US than in it. It's time to deliver to them the same great Apple retail experience that defines the Apple brand in the US. And there's no better time than now.

Comments

[Andrea Di S...:]

As long as I know there's no Apple Store here in Milan, it's been opened just in Rome; I think people will line up there ...

Apart from this there are few shops from cell phones brands like Nokia or Motorola, I think most if not close to all their cell phones are sold by carriers here in Europe.

I agree with the need to do more from Apple and so waiting for a real Milan store here. =)

Andrea Di Salvo

2007 Sep 05 06:30 AM

[Nigel Cheff...:]

Apple may not have many stores, but it is not that simple. The John Lewis chain has specialist Apple sections in-store, and Apple is currently advertising for staff for a new shop here in Exeter, Devon, SW UK. Since it will be in the newest and biggest mall (I hate that word!) in the area, the catchment area will be huge. Oh, and yes, I'm a Mac user...
N

2007 Sep 05 07:59 AM

[ET:]

Just because we haven't been able to identify where the stores are opening across Europe doesn't mean that they're not in the works. I think we may be getting an augury of Apple's planning and let's remember, Apple isn't just the iPhone; as you so eloquently mentioned, Apple's retail operations are a stylish, profit engine. All the best.

2007 Sep 05 10:14 AM