Thursday, July 22, 2010, 07:20 am PT (10:20 am ET)
Apple plots new strategy to target small businesses through retail storesApple has begun to focus on small, local businesses as part of a newly evolved strategy that aims to expand the company's sales past the consumer market.
The company is currently looking to hire engineers in a handful of retail stores in the U.S., and those employees would specialize in assembling Mac-based computer systems for small businesses. People familiar with the company's strategy told The Wall Street Journal that the hires are part of a greater focus on small business clients.
Apple is said to have at least one salesperson dedicated to managing accounts with local businesses, and has also recently begun recruiting within its sales staff to create a team that negotiates leasing and pricing terms for business clients. People familiar with the company's plans said the strategy has proven successful, as some stores have seen their revenue more than double after implementing the program.
The company has also begun an incentive program that will assign business-centered sales staff based on revenue targets for each store. And some of Apple's newer retail locations include specialized conference rooms, designed specifically for meetings between the sales staff and business executives.
The company's new focus is meant to take Apple beyond its market of consumers and niche businesses, like design and media firms, the Journal said. Apple hopes to leverage the popularity of the iPhone and iPad, both of which have found broad adoption in the enterprise market. The company hopes that familiarity with those products will lead businesses to pursue Apple's Mac computers and servers.
"Apple has had mixed results trying to crack the business market in the past. Its computers are generally more expensive than comparable PCs, prompting cost-conscious companies to look for cheaper alternatives," the report said. "Apple's retail staff historically hasn't provided the hand-holding and on-site support that many businesses expect. Instead, it has cultivated a network of authorized consultants, many of whose customers are referrals from Apple's retail employees."
The new strategy could prove lucrative: The Journal noted that North American businesses with less than 1,000 employees are expected to spend $310.8 billion on information technology this year, according to Gartner. That number is expected to increase by 6 percent, to $328.3 billion, in 2011.
During Apple's quarterly earnings conference call on Tuesday, Chief Operating Officer Tim Cook revealed that more than 80 percent of the Fortune 100 are deploying or piloting the iPhone, while more than 50 percent are using or testing the iPad. Mac hardware, however, has not yet seen as great of an embrace from the enterprise market.
"In terms of the Macintosh, you can see the Mac had an incredible quarter," Cook said, referring to record sales of 3.47 million Macs. "We're still selling principally to consumer and education, but we are seeing businesses with increasing interest in the Mac. It's more difficult to measure because many of those sales are filled through the channel. But we're obviously thrilled with growing 33 percent year on year."
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