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Apple Stores reportedly continue to see cutbacks as focus shifts to revenue

post #1 of 152
Thread Starter 
A report on Monday outlines the supposed gradual but significant change Apple's retail stores are going through as Senior Vice President of Retail John Browett emphasizes revenue over customer experience.

Citing inside sources, ifoAppleStore reports that signs persist of an emphasis on revenues at Apple's retail outlets, saying the drive to profits is taking its toll on employees and could tarnish the chain's reputation.

The report comes after retail chief John Browett allegedly laid off a significant number of recently-hired staff, cut back working hours for part-timers and put a freeze on inter-store transfers in order to boost profit margins. In a subsequent investigative piece by The Wall Street Journal, Browett claimed the staffing changes were a "mistake," noting that the actions had been reversed. He then reportedly requested leadership teams tell employees "we messed up," stressing that there were no layoffs taking place and new hires were being made.

According to the unnamed sources, the employees who had been "dismissed" were rehired and transfers resumed, though some locations still have no in-store workshops, offer limited overtime and haven't yet reversed demotions.

Browett supposedly has yet to apologize for the "mistake," and has instead reportedly instructed employees not to discuss the matter. Morale has declined, according to one insider, due to lack of information, inability to discuss the situation and increased pressure to sell product.

Sources say employee performance is measured by metrics, including contract sales of iPhones and a program called "essentials per hero product," which weighs in the amount of value-added merchandise like accessories a salesperson moves. Staff has also reportedly been advised to urge customers to use the EasyPay app, however sales made through the program aren't credited to a specialist's sales history which relates directly with performance.

Apple Store Staff


Perhaps even more of a problem are alleged cuts to maintenance budgets, which could affect the trademark cleanliness of Apple Store floorspace and product displays. Also reportedly cut are select training areas and Red Zone displays, to be replaced by more "Etc." and accessory shelving.

While it is unclear how widespread the changes are, or if they even officially exist, sources claim there has been a definite emphasis on revenue since Browett took over for former retail head Ron Johnson in January.
post #2 of 152

If I see a box of Ginger Snaps on the shelf, I will know things have digressed.

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post #3 of 152

I was in an Apple store today and they wouldn't give me a free replacement on my Macbook Pro battery, which was so swollen that the trackpad doesn't even work anymore. Yes, it's out of warranty, but it's also a massive fire hazard and has the risk of exploding. (It still holds a charge just fine, it just doesn't fit in the case anymore.) How long until there are more batteries bursting into flames on airplanes because Apple is too cheap to offer replacements. And this is after I already shelled out ~$80 to buy a new power cord within the last couple months because that too had become completely frayed and was also a fire hazard.

 

What's more, I tried to report the swelling issue on their 800 number since it's a serious safety hazard, and they wouldn't even file a report.

post #4 of 152

I don't think this new guy gets it:  Apple doesn't just sell a product, it sells a great customer experience.  Everybody at that company knows that is how it works, and it is amazing that they are letting this guy go forward with this plan.  Maybe they are a little overcrowded (I've felt the opposite most of the time) with employees, but Apple has made a lot of money primarily by focusing on the experience and not the bottom line.

post #5 of 152

Time sell Apple stock. Apple is now toast. 

 

Whose fault is it? Tim Cook. 

post #6 of 152

Things are going to be different whenever there is a change in CEO, and whenever there is a change in a significant position such as SVP of retail. We may just be hearing from some disgruntled employees, which there always are. The thing to remember is that Ron Johnson wasn't pushed out. A CEO position became available, and he jumped at the chance (although he's finding things difficult at JC Penney). 

 

Like it or not 2012 is very different from 2001, and the goals of the stores are evolving. Before we all cry wolf, let's see what happens. For all the positives of the Johnson era, the Apple Stores always did have a circus-like atmosphere where it could be difficult for someone looking to purchase an accessory or non-iOS device. Things may just be a bit more obvious now that a new SVP is doing what all new SVPs do and establishing himself.

post #7 of 152

Revenues over customer happiness? Unacceptable for Apple. Apple should not be following the formula set by the failing big box stores.

"Apple should pull the plug on the iPhone."

John C. Dvorak, 2007
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"Apple should pull the plug on the iPhone."

John C. Dvorak, 2007
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post #8 of 152

This sure doesn't sound promising.  I bought an iPad as a gift for my mother about two weeks ago and the Genius I was dealing with pulled a BestBuy sales routine to push Applecare down my throat.  I did not appreciate it -- and thought to myself that it felt like the guy was on commission.  I do not want to deal with commissioned/quota'd sales people when I visit an Apple store.

post #9 of 152
Quote:
Originally Posted by waldobushman View Post

Time sell Apple stock. Apple is now toast. 

 

Whose fault is it? Tim Cook. 

 

Tim Cook is no John Sculley. Some things will undoubtedly be different, but on the whole he's been doing a good job. They scored a big win on Friday in court. They launched the new iPad, and for the first time in years they had enough supply to match demand. They released Mountain Lion on schedule, and look to have a great new iPhone in the wings.

post #10 of 152

Apple could easily get rid of a certain percentage of their retail staff. There's way too many of them whenever I visit any Apple store. 

 

Look at that picture above, that's from the Grand central store I believe. The amount of employees is ridiculous, Apple should lay off at least 25% of them.

post #11 of 152

New guy seems to have a Best Buy mentality, hoping Tim Cook wises  up soon

post #12 of 152
Quote:
Originally Posted by KPOM View Post

 

Tim Cook is no John Sculley. Some things will undoubtedly be different, but on the whole he's been doing a good job. They scored a big win on Friday in court. They launched the new iPad, and for the first time in years they had enough supply to match demand. They released Mountain Lion on schedule, and look to have a great new iPhone in the wings.

 

The things you mentioned are not really related to the core advantage of Apple - a premium brand. The cutbacks in service will undoubtly affect the brand image, which is a lot more important than let's say whether they release product on schedule or with enough supply. Note that I don't mind cutting back staffs if there's way too many of them, but definitely not sacrificing service for revenue.

post #13 of 152
It really sounds more like sour grapes trolling than real issues at this point.

As for easy pay vs associate sale, that is a good distinction and not really a conflict: sales associates should have a higher mean revenue per transaction than easy pay. You can't just buy a Mac with EasyPay...

That said... I really don't like the twerp and will be happy if he is booted before his options vest.
post #14 of 152

I think this new SVP is dangerous.  I'll reserve judgement for a while though, and observe conditions myself when I go visit some Apple stores...

 

I would hate to think someone at Apple would even consider revenue over customer experience.  Apple's hallmark is customer experience in absolutely every thing they do/make, and they've made mountains of money because of it.  To consider a move in the other direction is suicide.  "Revenue first" is the death knell of any technology company ever created.  The planet is littered with the corpses of companies that either never understood or lapsed in the departments of quality and customer experience.  Apple once flirted with this stupid idea before, and it nearly killed them.  I pray they don't repeat.

post #15 of 152
Don't Apple Stores already have some of the highest revenues per square foot among ALL retailers?
post #16 of 152

I still don't know why they hired someone to put in charge thats done nothing but run retail businesses into the ground and made then &$*#&.

post #17 of 152

Think Different.  This is what they're doing.

post #18 of 152
Quote:
Originally Posted by Srice View Post

This sure doesn't sound promising.  I bought an iPad as a gift for my mother about two weeks ago and the Genius I was dealing with pulled a BestBuy sales routine to push Applecare down my throat.  I did not appreciate it -- and thought to myself that it felt like the guy was on commission.  I do not want to deal with commissioned/quota'd sales people when I visit an Apple store.

 

To be fair, that would have been my strong recommendation as well, and I'm not trying to sell you anything.  Maybe the Genius has see how many iPads come back damaged, and for the $100 you know that there's no problem with repairs for the foreseeable future.  I personally wouldn't buy an iPad without AppleCare, just like I wouldn't buy a Mac without AppleCare.  Accessories and smaller items are fine without it, yes, but anything $400 it's worth it for the peace of mind.

 

This is all to say that it may not be as calculated or cynical as you think.

post #19 of 152

Anyone from the UK who has shopped in the stores this ass has managed, will know how  familiar this sounds. 

 

Apple : Get rid of John Browett ASAP.  He is everything you are not.

post #20 of 152

Nope, the new guy doesn't get it.  And neither does the person that hired him.  It's just one more little thing since Steve died. Sam Walton ran a tight ship just like Steve. When Sam died, the whole company went to hell.  When was the last time an employee greeted you or smiled at Walmart?

 

Quote:
Originally Posted by priced4evil View Post

I don't think this new guy gets it:  Apple doesn't just sell a product, it sells a great customer experience.  Everybody at that company knows that is how it works, and it is amazing that they are letting this guy go forward with this plan.  Maybe they are a little overcrowded (I've felt the opposite most of the time) with employees, but Apple has made a lot of money primarily by focusing on the experience and not the bottom line.

post #21 of 152

Hard to believe the story as Tim Cook is a big believer in customer service. Also why would this new gut try to spoil whats working so well???

Have no fear I'm sure that if the story is true than Tim Cook is watching over this guy. He just didn't give this guy a free hand. You can be sure of that.

post #22 of 152

I think this is a good move by Apple as they will save loads of money in the end. Most sales are made online anyway, so its not a problem.

post #23 of 152

OMG - this must be the dumbest thing Apple can do.  The customer experience, the level of service, the genius bar, providing service out of warranty sometimes - this is what makes people like the Apple experience.  DITCH THIS GUY NOW!

post #24 of 152
Quote:
Originally Posted by Michael Scrip View Post

Don't Apple Stores already have some of the highest revenues per square foot among ALL retailers?

That's true.  If I'm correct, the 5th Avenue, New York store has the THE highest revenue / square feet of any retailer worldwide, followed by Tiffany's.

post #25 of 152

If true, it's the beginning of a long slide downward.  And very dumb.  Jobs would be apoplectic.

 

The retail experience is part of what has put Apple where it is.  While I'm sure some extra revenue could be squeezed out of the stores, I'm also sure that it isn't worth the corrosion to the brand. 
 

post #26 of 152

Browett must have had SOMETHING going for him to get hired. I can’t imagine what. Something big enough to offset the recent apparent blunders? (Which I have no reason to doubt happened.)

 

Well, not something big enough to keep him on if he can’t get over the “focus on revenue” thing. No third chance! I can’t see how he’ll remain at Apple unless a lot of these stories are simply not true. (And that is possible, but they smell true to me.)

 

 

Quote:
Originally Posted by Markussd View Post

I think this is a good move by Apple as they will save loads of money in the end. Most sales are made online anyway, so its not a problem.

 

 

I’m sure Browett would point to that fact too—I don’t dispute it. But a LOT of those sales are to people who visited Apple stores in their decision-making process. Still others are sales to people who will get more from their machine because they had an Apple Store to rely on during ownership—which in turn impacts future sales directly. And indirectly: happy customers spread word of mouth, online and in person alike. Plus, we have stats on how heavily the stores sell to first-time Apple users. Invaluable customer-base expansion. Mindshare, not just revenue per square foot.

 

Recent years have shown how vital the quality Apple Store experience has been to Apple.

post #27 of 152
Quote:
Originally Posted by Apple ][ View Post

Apple could easily get rid of a certain percentage of their retail staff. There's way too many of them whenever I visit any Apple store. 

 

Look at that picture above, that's from the Grand central store I believe. The amount of employees is ridiculous, Apple should lay off at least 25% of them.

 

I was at an Apple Store over the weekend and so many of their staff just standing around doing nothing.  

post #28 of 152
Quote:
Originally Posted by Alex3917 View Post

I was in an Apple store today and they wouldn't give me a free replacement on my Macbook Pro battery, which was so swollen that the trackpad doesn't even work anymore. Yes, it's out of warranty, but it's also a massive fire hazard and has the risk of exploding. (It still holds a charge just fine, it just doesn't fit in the case anymore.) How long until there are more batteries bursting into flames on airplanes because Apple is too cheap to offer replacements. And this is after I already shelled out ~$80 to buy a new power cord within the last couple months because that too had become completely frayed and was also a fire hazard.

 

What's more, I tried to report the swelling issue on their 800 number since it's a serious safety hazard, and they wouldn't even file a report.

Send an email to tcook@apple.com see what happens, but explain the situation in full detail without getting nasty.  MAYBE he'll surprise you.  It doesn't cost you anything.

post #29 of 152
Quote:
Originally Posted by Shameer Mulji View Post

That's true.  If I'm correct, the 5th Avenue, New York store has the THE highest revenue / square feet of any retailer worldwide, followed by Tiffany's.

I believe that you are correct. I live not too far away from that store, and an employee who works there told me the same thing too when I was there a while ago.

post #30 of 152
Quote:
Originally Posted by winstein2010 View Post

 

I was at an Apple Store over the weekend and so many of their staff just standing around doing nothing.  

Yes, and that's partially what I meant by my comment. I don't mean that Apple should sacrifice customer experience and service for profits, but there's no need to have a ridiculous amount of employees either. Even if they cut down a bit, there would still be plenty of employees.

post #31 of 152
Quote:
Originally Posted by winstein2010 View Post

 

I was at an Apple Store over the weekend and so many of their staff just standing around doing nothing.  

Well, it's hard to predict when the customers walk in the door.  It's hard to manage that since every day is different.  I've walked into an Apple store on a weekday and it had a few people and then walk in on another week day and it is packed.  There's no rhyme or reason.  Now, obviously we are going into the end of summer months, so it would make sense if less people were going into the Store during the week day.  So, that might be what people are experiencing.

 

But when the new products get announced, back come the lines of customers.

post #32 of 152

This is where the CEO, who sees the bigger picture, is supposed to override the operations guy. Oops... the CEO is the operations guy.

post #33 of 152
Quote:
Originally Posted by nagromme View Post

Browett must have had SOMETHING going for him to get hired. I can’t imagine what. Something big enough to offset the recent apparent blunders? (Which I have no reason to doubt happened.)

 

Well, not something big enough to keep him on if he can’t get over the “focus on revenue” thing. No third chance! I can’t see how he’ll remain at Apple unless a lot of these stories are simply not true. (And that is possible, but they smell true to me.)

 

 

 

I’m sure Browett would point to that fact too—I don’t dispute it. But a LOT of those sales are to people who visited Apple stores in their decision-making process. Still others are sales to people who will get more from their machine because they had an Apple Store to rely on during ownership—which in turn impacts future sales directly. And indirectly: happy customers spread word of mouth, online and in person alike. Plus, we have stats on how heavily the stores sell to first-time Apple users. Invaluable customer-base expansion. Mindshare, not just revenue per square foot.

 

Recent years have shown how vital the quality Apple Store experience has been to Apple.

It's typical for new Sales management to come in and do something to make an impact either in trying to increase sales, reduce costs, etc.  I've seen that many times before.

 

The other side is it is the end to the summer months and kids are going back to school instead of hanging around the stores, etc.  So, that might be the reasoning.

 

But, STILL customer service should always be the FIRST priority.  PERIOD.   Employee morale is secondary and THEN profits.

 

Happy Customers mean RETURN customers, means INCREASED sales.  Happy Employees mean more willing to do their job to take care of what needs to be taken care of.

 

It all feeds on one another.

post #34 of 152
Quote:
Originally Posted by Michael Scrip View Post

Don't Apple Stores already have some of the highest revenues per square foot among ALL retailers?

Yeah, but they need to constantly attract those customers and Customer Service is a BIG way to do so.  Keeping the employees happy and ensuring they keep the customers happy is what it's based on. Making great products is just one piece of the cog.  They need to make sure ALL pieces are there.

post #35 of 152

Long before Browett came on the scene, I have not been at all impressed with the Apple Store staff apart from those at the Genius bar.  I've found the average sales assistant to either lack knowledge about the products or laxidasical.  

post #36 of 152
deleted
Edited by kellya74u - 7/24/13 at 9:33am
post #37 of 152
Quote:
Originally Posted by KPOM View Post

 

Tim Cook is no John Sculley. Some things will undoubtedly be different, but on the whole he's been doing a good job. They scored a big win on Friday in court. They launched the new iPad, and for the first time in years they had enough supply to match demand. They released Mountain Lion on schedule, and look to have a great new iPhone in the wings.

 

You can thank the lawyers for that, not Cook. New iPad was one of Jobs' final projects, so again, meh. As for ML being released "on schedule," A) they set that schedule internally, so I don't see the significance of that, and B) previous launches came along with hardware refreshes, whereas ML came a month after. Sounds like it was behind schedule to me.

 

And saying Cook is no Sculley isn't exactly high praise, seeing how he's no Steve Jobs either.

post #38 of 152
Quote:
Originally Posted by "Apple 
[" url="/t/152163/apple-stores-reportedly-continue-to-see-cutbacks-as-focus-shifts-to-revenue#post_2177292"]Apple could easily get rid of a certain percentage of their retail staff. There's way too many of them whenever I visit any Apple store. 

Look at that picture above, that's from the Grand central store I believe. The amount of employees is ridiculous, Apple should lay off at least 25% of them.

you may or may not have a point but considering Apple could enact a policy to slaughter babies every day before store opening as a sacrifice to the retail gods and you'd be all for it.

"Well obviously there are too many babies in this world and all Apple is doing is continuing to help the economy by keeping the population down."
post #39 of 152
Quote:
Originally Posted by AbsoluteDesignz View Post


you may or may not have a point but considering Apple could enact a policy to slaughter babies every day before store opening as a sacrifice to the retail gods and you'd be all for it.
"Well obviously there are too many babies in this world and all Apple is doing is continuing to help the economy by keeping the population down."

 

40-50 million babies are slaughtered every year (worldwide of course), those kind of people don't need Apple's help for that.lol.gif

post #40 of 152
People have to stop thinking that, just because someone is upper management and paid disgusting amounts of money, and rich from previous jobs, that they have any clue what they're doing or are experts in any way. What this guy does is the same thing that many high paid executives do: they butt-snorkel to get into a place, telling stories about how much they did at other jobs, get the job, butt-snorkel their superiors to maintain superficial image... then they change everything that was in place by their predecessor, in the arrogant assumption that they know better (without any experience in the position at the current company), and proceed to create more "value" for the shareholders by destroying everything underneath themselves (which shareholders don't usually have enough interest in to care about).

This is not hard to do!! There's plenty of damage you can do at this level while presenting it as "good" to your superiors, who have put you into your position so they don't have to pay attention to those things. You have near free-reign over those below you and your departmental responsibilities because that's what you're hired to do. This is EASY.

The end result is that people think they've done a good job because all anyone at that level looks at is the newly increased profits, without caring what suffered to produce them. Once the blood has been squeezed from the stone, the people at the top wonder where all their customers' anger comes from and why they are seeing depressed sales, bad reviews, reports in media about employees hating them, etc. They paid the guy to manage this stuff so they didn't need to but what they didn't count on was hiring a sociopath. Still, it's an easy solution from that level: They blame the guy they hired to do all this and give him a huge payoff to leave the company earlier than the employment contract stipulated. Then the person moves over to another big corporation, showing all his profit-making kudos, earning him another high-paying job, moves in and does the exact same thing all over again. He doesn't learn. He doesn't suffer consequences. He rides on the backs of those he destroys and will do so into retirement, where he will do even less to "earn" the comfort he has long been accustomed to expecting.

Take this hypothetical story and apply it to all kinds of corporate and government positions and you have an accurate portrait of the sociopathy of the capitalism we currently worship. It's not capitalism itself that's the problem; it's the execution and the sole focus on profits and stock values. Those things do not exist without service and product but the majority of public businesses are run as if that's the case.

I've watched it first hand and no doubt do too have many of you. Stop putting up with it.
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