Apple Sets a Bad Example

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In the world of retail, Apple's approach with its Apple Stores in some ways flies in the face of current conventional wisdom, says Doug Stephens, president of Retail Prophet, a consultancy focused on the future of retail.

Stephens says the key to the future in retail is bottom-up marketing, including getting real-time reactions to products you're selling (or planning to sell) through social media and mobile channels and then reacting quickly to ramp up the winners or dump the dogs. This especially applies to manufacturers of fashionable, "must have" items.

At the same time, mass markets are giving way to fragmented groups of more fickle consumers who have instant access to all of the trends, tire of them quickly, and won't be told what is hot and what is not. Crowdsourcing is in for informed decision makers. An open, engaged dialog with customers is critical throughout the process.

That is, unless you're Apple.

Apple Stores do many things well in terms of customer interactions in the store. But in in some ways Apple has succeeded by doing it all wrong -- and its model is not necessarily transferrable. "They don't crowdsource anything. They don't share. They go into their fortress and conceive products, make them in enormous quantities and are highly successful."

Other retailers or manufacturers that follow Apple's example are making a big mistake, he warns. "Apple is the anomaly," a unique organization that develops its own products and chooses what to sell based not on collective intelligence but on an internally focused process dominated by the experience and intuition of a select few. It can dictate to its customers what they should want - and get away with it -- because it is Apple.

The fortunes of many retailers have risen and fallen on decisions based on the experience, hunches and intuition of a few individuals. When the chosen few lose their mojo -- particularly in the fashion-conscious apparel business -- the company's fortunes can suffer. Following Apple's example may leave retailers -- or manufacturers for that matter -- with too many eggs in one basket.

This story, "Apple Sets a Bad Example" was originally published by Computerworld.

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