Apple Mobile POS, retail localization

Increasing Revenue Without Increasing Floor Size

Apple generates nearly $6,000 per square foot, double that of Tiffany & Co. The retailer is attributed with an innovative approach to mobile, hand-held devices as a key element of their success. According to Chain Store Age, Apple has exemplified a growing trend among retailers and their managers, utilizing mobile devices to increase the revenue per square foot of brick-and-mortar stores without expanding their footprint.

Apple Mobile POS, retail localization

From the article:

On the surface, this approach would seem contrary to long-held retailing tenets: rather than closing sales in the middle of the store, you typically want customers to wander through the store long enough to maximize the potential purchase basket; and having them wait in line leads to extra incremental purchases of lower-cost but high-margin items near the cash register.

There are two counterarguments to these strategies. First, there is a segment of customers who walk into a retail location, see a long line, and leave without spending any money. They want what you sell but prefer to get it with greater convenience, whether on the Internet or from another brick-and-mortar store. Second, if the person with the register can roam the store with a customer, they are in a far better position than a static cashier to offer relevant upgrades, accessories, or other incremental sales. In previous attempts to speed check out and save costs, many retailers introduced the self-checkout. An ironic twist to Apple’s retail strategy is that the company — which is famous for making technology easy to use — is not using the smart phone technology to replace staff. Rather, it uses it to maximize productivity of real estate.

With today’s technology, sales people don’t even need to be bound by the store’s walls: In certain settings — malls for example — they may find it appropriate to discuss the customer’s choice of available options for bigger-ticket options while relaxing on a bench outside the store with a cup of coffee. And with payment systems like Square Register, they can even accept credit-card payments to close the deal right there.