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Comment by criddell | Hacker News Reader

I think one of the smartest things Apple did was open physical stores and not depend on carrier stores and Best Buy.

I've often wondered why their competitors don't do the same thing? Why isn't there a Samsung store a block away from every Apple store? Having a physical location for purchases, repairs, and support is why I always recommend Apple devices when somebody who isn't super technical asks me what to buy.

Microsoft made a half-hearted effort, Sony was there too soon with their stores, Dell had crappy little mall kiosks. Apple has shown you can make pretty great revenue-per-sq-ft with a store. Samsung copies everything else Apple, why not the stores?

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Apple is capturing 75% of profits, and sees the stores as instrumental to that. Every other company seems to see retail as an additional cost.

Apple started with kiosks inside of Best Buy, too, and it took many years before their stores reached the level of ubiquity they have today. Any competitor trying to make the same level of investment would lead to Apple's share of profits inching closer to 100%, as their competitors would be spending a ton on retail buildouts.

Apple makes more per square foot of retail than anyone else[0]. It's not even really close. Each of the other companies you've mentioned has opened stores, albeit not on the same scale. None of them have seen anything like similar results, so why would they keep expanding to match scale?

Apple Stores are valuable because Apple products are valuable. Apple products are valuable in part because Apple Stores are valuable. It's a virtuous circle that doesn't work for any of their competitors, at least not any so far.

0. https://news.retailsphere.com/how-apple-became-the-worlds-hi...

Apple products are also valuable because they build in user-centric dark-pattern limiters that HN hates but consumers happily value and pay for.

These threads keep saying the profits are sales and marketing as if artificial. On the contrary, user-centricity even to point of dev-hostility is a specific product market fit tradeoff Apple pursues, giving the whole brand a halo effect and premium.

Devs need to roll with that or will continually find themselves misaligned.

Apple was derided when they started opening stores. Gateway had tried it and it killed the company. Dell tried it, but we’re killing it with the computers-by-mail business and it’s opportunities for financial engineering.

What did apple bring to the game? With a tired product line in a maturing market, the last thing they needed was another expensive effort in a domain they had no experience in (retail) while simultaneously killing their retail channel.

It’s my understanding that the popular understanding turned out not to be completely accurate.

Apple wasn't selling commodity PCs and had the profit margin to operate stores on extremely expensive real estate. The stores themselves ended up being advertisements.

That was not the analysis at the time. Also back then they didn’t have the fat margins. But the dealer network was thin so the risk of losing the channel wasn’t the risk people thought it was.

I’m actually surprised they did as well as they did.

Apple's gross margin was always pretty high even if their fixed costs made them highly unprofitable. I'll grant that the Apple Store concept was a hail mary but they weren't a company losing money on every computer and hoping to make it up in volume as Dell and Gateway ended up being at the time. They had the cashflows to make the concept work.

We're talking about 2001 when apple's revenues were declining and it was losing money, though it had been in even worse shape a few years before. The stores were part of a Hail Mary.

Apple sells a luxury product. Physical stores are the type of thing you do for a luxury product.

You can buy basic macarons at the grocery store, or go to Laduree for the luxury version. Same deal.

The most expensive (non-novelty) phones sold right now are from Samsung. At every price point that Apple sells at, Samsung has a similar product.

Apple also sells their handsets through carriers, big box stores, and online through places like Amazon. You can often buy their stuff for less at these places yet the stores are still packed because people will pay more if it's a better experience.

> People will pay more if it’s a better experience

Luxury does not mean expensive, though $ can be a proxy. It often is much more about feeling (relaxed, comforted), experience (end-to-end, straightforward), and status (“high-class”).

Samsung sells better phones for more $. Apple is much more about “if you don’t mind the price, we’ll take care of everything and it’ll be simple, comprehensive, and your friends will respect our product.”

As much as I hate to bow into cargo cult dynamics, the most expensive Samsung phone still leaves you as a green chat box on text.

Stores also function as service centres.

Lots of people only use the Apple store to get things fixed.

The store is just a physical extension of apples drive to put the customer experience first.

> The store is just a physical extension of apples drive to put the customer experience first.

They could learn a thing or two from Dell and Lenovo about repair turnarounds.

In The Olde Days you could schedule a return; when the fedex driver stopped by you could ask them to wait and pop your laptop into the box and hand it back, and have the repaired machine the next day. No more.

My daughter's new Alienware laptop broke. We contacted support and they dispatched a repair person to her house and he fixed it on site.

I’ve heard that Dell does this for business. Good for them for looking after their gaming customers too!

Apple makes you jump through hoops these days. I am sure it’s because they are bigger and because they are no longer the underdog. But mix this change because “things no longer scale at their size” or “we are so big we don’t care as much”?

Samsung has been experimenting with "stores" they have entire sections in a few Best Buys called "Samsung Experience Shop"

https://www.samsung.com/us/samsung-experience-shop/index.htm...

https://www.bestbuy.com/site/samsung-store/samsung-experienc...

Opening retail stores is a huge commitment and takes years of investment before you "might" see any returns. Samsung doesn't seem to want to take that risk. But I do agree, I recently switched most of my devices over to Apple products because they take care of their customers. And if I ever have an issue, there are 3 Apple stores within 25 miles of me.

I was recently on the Galaxy Fold subreddit and there was a user who had his $2,000 device fail. Samsung had him mail it in. It had then been two weeks with no communication at that point. Other users had the same experience with Samsung denying repairs for some of them after keeping the device for several weeks. That is completely unacceptable and slightly terrifying.

>"And if I ever have an issue, there are 3 Apple stores within 25 miles of me."

I am in Toronto and if we are talking 25 miles radius there are like hundreds of shops that can sell/replace/fix android based phones.

A lot of those stores will also do some iPhone repairs.

If you are having trouble with your email or want help connecting some accessory, how many of those shops will help with that kind of stuff? When it's an issue that can't be fixed and your phone is still under warranty, how many of those shops give you a replacement on the spot? A few will for sure, but it's not a lot of them.

>"A lot of those stores will also do some iPhone repairs."

Yes they will. They do not start their day by praising almighty Samsung / Apple and do whatever gets them money.

>"If you are having trouble with your email or want help connecting some accessory, how many of those shops will help with that kind of stuff?"

I do not know "how many" exactly but they do help customers with many things, not just repairs.

> Apple has shown you can make pretty great revenue-per-sq-ft with a store. Samsung copies everything else Apple, why not the stores?

Apple has shown that Apple can make amazing revenue-per-sq-ft.

Samsung does have its stores in my country (Czechia). Very much inspired by Apple, touting flagship phones and all.

yep. Brazil too. AFAIK there is only one Apple store in Sao Paulo (though there are Apple resellers too) but Samsung has stores in virtually all high end malls. Xiaomi had a pilot store here too.

The context is that Brazil has high import duties on manufactured goods. Apple doesn't manufacture domestically. Samsung does.

You say Microsoft was half-hearted, but their stores came closest to demoing the premium devices of the Windows ecosystem, whereas Samsung stores were actually pretty lame. I'm not surprised Samsung stopped their build-out.

> their stores came closest to demoing the premium devices of the Windows ecosystem

That's true, but it was still a half-hearted effort.

The only time I ever saw people in them was after school when kids were playing Xbox.

I went in once because they weren’t crowded…to ask directions to the Apple store. I felt kinda bad but they were just standing around with no customers anyway. I did apologize, and I remember the person I asked being very nice.

The first Sony store opened in 1970 in Canada

Samsung stores are quite common in Asia.

Pretty much all of APAC. They have big stores in Sydney/Melbourne in Australia too.

Motorola tried opening a store in downtown Chicago. Didn't seem very busy at all...

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