Retail eye candy

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Consumers today trudge through a monotonous retail landscape much like the human drones in Apple's classic "1984" spot for Macintosh. This time, what's breaking them out of their trance is the Apple Computer retail store.

"There's always a buzz in the store, a lot of `oohing and `aahing' and a level of excitement that's rare in retail today," says Paula Ausick, senior VP-director of brand equities at Interpublic Group of Cos.' Foote, Cone & Belding Worldwide, Chicago. With clean white spaces dotted with hip help in black T-shirts encouraging consumers to try out products, "It's high-touch in a high-tech environment," Ms. Ausick says.

The store is organized around signs demarking areas by the tasks the Apple products accomplish, such as moviemaking, digital photography or music. What might unimaginatively be called a customer service or customer information desk elsewhere is called the "genius bar" at the Apple store.

"It's not a museum, even though it has museum styling with simple elegance," says Joe Jackman, chairman-CEO of Perennial Inc., a Toronto-based strategic retail creative consultancy that helps retailers think up store concepts. "The Apple fraternity can feel like they have come home. For the non-user, it's very, very sexy."

Apple says its retail net sales hit $428 million for the first nine months of its fiscal 2003, up 136% from the same period in 2002; for the third quarter, net sales were up 130%. Apple financials filed with the Securities & Exchange Commission also reported its retail segment lost $6 million for the nine months ended in June 2003, down from $18 million in the same period in 2002. Although Apple executives told investors in the fourth quarter its stores generated $35 million in manufacturers' profits, and had 4.3 million visitors.