Apple Retail's Emphasis on Profits Continues, Tied to Operational Perspective of Cook and Browett

[MacRumors]

Earlier this month, we reported on several changes at Apple retail stores that were reportedly seeing some employees being laid off or seeing recent promotions being retracted, while other part-time employees were seeing their hours reduced significantly, in some cases to zero. Our report was followed several days later by an acknowledgement from Apple that the company had "messed up" in adjusting its staffing formulas for its retail stores.

ifoAppleStore now takes a close look at the situation, tying changes in the philosophy of Apple's retail experience to the passing of Steve Jobs and the operational focus of Apple CEO Tim Cook and new retail chief John Browett. At the most basic level, Jobs served as the champion for former retail chief Ron Johnson's vision of Apple stores focused on consumer satisfaction, and without Jobs to protect that vision Apple has slipped into a numbers-focused perspective for its retail operations.

Johnson was champion of customer satisfaction, designing and staffing the stores to provide a superior experience for visitors and buyers alike. He was able to win over Steve Jobs with the concept that revenue and profit should be a secondary goal of Apple's retail stores.

But in 2009, Jobs took six months of medical leave and put Tim Cook in charge of the company, including the retail stores. Cook is primarily an "operations guy," sources explain, and his natural focus is revenues and profits, not customers. While Jobs was away, Cook and chief financial officer Peter Oppenheimer began to confront Johnson on his customer-centric retail philosophy--both felt the stores didn't generate enough revenues to justify operating expenses.

The report claims that Cook hired Browett to replace Johnson, who departed Apple to lead department store chain JC Penney last year, specifically because of his focus on "traditional concepts of retailing" that prioritize revenues and profits as the key performance metrics.

Tim Cook (left) and John Browett (right)

Even with Apple reportedly having reversed a number of the staffing changes that brought the company such significant publicity earlier this month, stores are reportedly still subject to directives reducing workshop offerings for customers and specifying policies on staff evaluation and compensation that prioritize profits over the customer experience and employee satisfaction.

Article Link: Apple Retail's Emphasis on Profits Continues, Tied to Operational Perspective of Cook and Browett

[levitynyc]

Best Buy values profit over customer satisfaction and look how great they are doing.

[appleguy123]

Browett will destroy the retail store experience for customers. You'd figure that Tim would be smart enough to see this.

[BigMcGuire]

And here we are.... the start of $ is more important than the customer experience . Won't be long before there will be justification of a cheaper crappier product to save $....

[gimliwon]

I appreciate all that Cook has done for the employees, but I will be the first to say that meeting these numbers/profits is not going to bode well for them.

I don't understand the world of business. If your primary goal becomes meeting quotas and percentiles rather than customer satisfaction, how do you ever expect to be a respectable business?

You can make all the beautiful, respectable things in the world.
But if you don't have heart, you don't have anything.

Disappointed.

[koban4max]

Originally Posted by BigMcGuire

And here we are.... the start of $ is more important than the customer experience . Won't be long before there will be justification of a cheaper crappier product to save $....

Till then keep supporting APPLE.

[spokenblurb]

This is not a good move guys you have more money than you can spend and your on top, keep doing the things that got you there because once the green eyed monster takes over then you become like everyone else.... I'm mean layoffs really browett get your ish together

[chrmjenkins]

Let's see how many ways we can alienate faithful customers. Pro users are already complaining.

[AustinIllini]

This just in: Apple is a corporation.

More as this story develops...

[gimliwon]

It's the most frustrating thing in the world to watch the company you've served for four years, put your heart into doing well, dissolve into this. I hope they come to their senses and stop these mistakes.

Because that's exactly what they are.

I may know nothing about business, but I do know,
you don't put the dollar before the person.

I may not know much, but I know that.

[DeathChill]

Curious about the validity of this report. I have a hard time believing that they were concerned about numbers if they're running one of the most profitable retail stores in the world.

[gimliwon]

That's no excuse, Austin. They've been a corporation for over thirty years. And it's never been this bad.

[wikus]

Originally Posted by chrmjenkins

Let's see how many ways we can alienate faithful customers. Pro users are already complaining.

Pro users have been complaining for years. Its been quite obvious for a long time that Apple doesnt care about users who rely on their macs for their income but would rather cater to the technologically inept with the iToy line.

[Drunken Master]

Don't these stores make a ton of money already? They're the most profitable chain retail store per square foot in the U.S.:

http://m.gizmodo.com/5903437/foot-for-foot-apple-stores-rake-in-17x-more-cash-than-other-retail-outlets

This is a big mistake that they're making, but it looks like maybe they'll back off a bit after "screwing up".

[WhoDaKat]

This totally makes sense as Apple is struggling to make a profit. Give me a break. Glass cubes, giant stores in Grand Central Station, and architectural innovating buildings is not the way you go to maximize profits, and thats not the point of these highly successful retail outlets. Its shock and awe, its getting the products into the hands of consumers so they can "play" with them. To do this is to understand why Apple products are so successful. Nickeling and dimeing consumers is the surest way Apple can shoot themselves in the foot.

Tim, your consumers made Apple the biggest company in the world, and we fight the good fight for you all over the internet (there are no fans like Apple fans) but if you even give off the appearance that you are trying to increase your already sky high profits, then you risk it all sir. You should fire this douche Browett and quit worrying about retail stores profits. Their job is to showcase... obviously the profits will come.

[Mark Booth]

I worked retail for 35 years before retiring in 2009. Everything I read and everything in my customer service "gut" tells me that Browett is the wrong person to head Apple retail.

Mark

[ECUpirate44]

Originally Posted by gooberwilson

Steve Jobs would've never allowed this.

This is the only time this comment is appropriate. Not sure what cook is thinking letting Browett do this....

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Originally Posted by WhoDaKat

This totally makes sense as Apple is struggling to make a profit. Give me a break. Glass cubes, giant stores in Grand Central Station, and architectural innovating buildings is not the way you go to maximize profits, and thats not the point of these highly successful retail outlets. Its shock and awe, its getting the products into the hands of consumers so they can "play" with them. To do this is to understand why Apple products are so successful. Nickeling and dimeing consumers is the surest way Apple can shoot themselves in the foot.

Tim, your consumers made Apple the biggest company in the world, and we fight the good fight for you all over the internet (there are no fans like Apple fans) but if you even give off the appearance that you are trying to increase your already sky high profits, then you risk it all sir. You should fire this douche Browett and quit worrying about retail stores profits. Their job is to showcase... obviously the profits will come.

This 100%

[darbus69]

so the days in which an apple store employee gave me $1 in quarters for the parking meter are over? cook and browett might want to sleep lightly because the ghost of Jobs is going to be out for their souls!

[striker33]

With all the quality control issues with the retina iPad and Macbook Pros, it was already blatantly obvious that Apple are all about the $$$ now.

The production of their products has been ramped up so much by Cook that the quality of the products is suffering. No doubt the next iPhone will be met by various build issues.

[Rot'nApple]

Well, Apple does have to consider quotas and percentiles as a way to measure profits that they need to meet so Apple can cover the promotional pay increase that engineering vice presidents Craig Federighi and Dan Riccio who are joining the company's Executive Team as senior vice presidents will be receiving.
/
/

[darbus69]

Originally Posted by ecupirate44

this is the only time this comment is appropriate. Not sure what cook is thinking letting browett do this....

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this 100%

ditto

pass it in and on and on.

[Peace]

We're not in it to make tons of money. We're in it to make a quality product.


---Tim Cook

[EnderTW]

Tim cook isn't Scully but they come from the same line of thinking.

Steve you will be missed.

[iRobby]

Originally Posted by ECUpirate44

This is the only time this comment is appropriate. Not sure what cook is thinking letting Browett do this....

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This 100%

Don't blame Browett!!

I'm sad to say, but according to the article this change was pushed by Cook and Oppenheimer long BEFORE Browett!

Looks like they had and still do a have a difference of opinion with Johnson on retail so they forced him out and hired Browett knowing he fit their ideology.

A real bad sign!

[BlazednSleepy]

This is like spitting on Steve Jobs grave. It's a REAL shame to hear apple moving in this direction. The number 1 reason I buy apple products is for the OVERALL EXPERIENCE.

Damn.