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Innovation Strategy

Do you need your own Apple stores?

Bose is closing most of its brick and mortar shops internationally. Is it a sound move to concentrate on e-commerce? Or is it the symptom of a poor strategic vision?

Today, Bose announced they’d be closing all of their stores in North America, Europe, Japan and Australia. In their original 1993 thinking, the idea for such a chain of international retail stores seemed clear enough:

“Originally, our retail stores gave people a way to experience, test, and talk to us about multi-component, CD and DVD-based home entertainment systems. At the time, it was a radical idea, but we focused on what our customers needed, and where they needed it – and we’re doing the same thing now.”

Colette Burke, vice president of Global Sales, Bose Corp., Jan. 2020

This was pure Apple playbook. Build strong customer intimacy through premium stores delivering the core brand experience. And to be fair with Bose management, it was copied by pretty much everyone, from Microsoft, Samsung or even Xiaomi:

One of the 300 Xiaomi’s “Mi Store” in China.

I was writing in 2018 about the rise of premium brick-and-mortar stores to help brands survive the online retail apocalypse. We now start to see the adjustment around this strategy that I was labeling as “Chic and Mortar Retail”. For the few Starbucks that had a vision and managed to pull it off, most other brands had nothing really important to say to their customers.

At the time I was writing this, in reference to how having built your brand digital presence, brick and mortar could make sense again:

“The brick and mortar operation sufficiently digitalized, and the cost structure reduced to minimum, the premise and the team can be made available to create new added-value options.”

But as with everything “innovation” going through the motions of what the leading competitor in your segment is doing is utterly dangerous. What’s your vision on how the market should change? Do you need a strong personal brand presence offline? Why? What is the unique opportunity you’re going to seize by facing live customers? These are not trivial questions to answer and your physical retail strategy will always clearly broadcast your core strategy.

Being a premium brand, is not something you just achieve by copying the look and feel of Apple stores. But if you are Such a brand, the online / offline discussion is pretty straightforward. Just ask Disney who had the most downloaded app in the US for Q4, 2019

By Philippe Méda

Philippe has been training about 200 startups a year since 2007, consulted for dozens of multinationals on rupture innovation or corporate incubation. He also teaches innovation in key MBA programs in Paris and Shanghai.