Inside the Channel

Microsoft retail store could be "transformational"

Microsoft's announcement last week that it would open its own retail stores have resulted in both praise and scorn, but regardless of what you think about it, there's no doubt that the move is truly going to change the marketplace.

Resellers who target the business market, especially mid-size and enterprise businesses, probably won't see any impact from the Microsoft store, although resellers targeting consumers and SOHO businesses may feel a little pinch as those customers may start going directly to the source. But in general, the move could end up being very positive for resellers as a whole, just because it will get Microsoft in front of the buying public--and that includes IT guys from corporate customers who will stroll into the shop from time to time.

Even if the stores only break even, Microsoft will be ahead here. The most important thing the company will get from the stores is not more direct sales, but better public relations and a better image. The obvious parallel is the Apple stores, and it's pretty obvious that's what Microsoft is trying to replicate. Apple in general is a bit pretentious, and so are their stores, but the store has been a big PR and marketing coup for them. They create a space where buyers can come in and partake of the Apple world, talk to Apple experts, and see the goods in action. It was a great idea, and I can't blame Microsoft for wanting to do the same thing.

The biggest mistake Microsoft could make though, is to make it just another retail store. There are already plenty of stores that sell Microsoft products. What they need is to make those stores a "destination", again in the same manner as Apple. You don't go into an Apple store just to buy something, you go in there and have an "experience". A coffee bar, some free seminars, and plenty of hands-on opportunities to take the goods for a test-spin would go a long way. The store must be transformational, and above all, shouldn't look like a Best Buy or any other ordinary retail shop. If there's no differentiation there, the shops won't last long. As the Microsoft press release puts it, the goal is to "focus on transforming the PC and device-buying experience for retail consumers".

The obvious question though, is how will Microsoft transform PC-buying experiences when they don't manufacture PCs? That question hasn't yet been answered. It's not likely that Microsoft will start making their own, but I would venture to guess that a partnership with an OEM would be appropriate so consumers could buy Microsoft-loaded PCs directly from the store.

I'm just wondering what the employee uniform will look like, and I can imagine walking in and being greeted by a bevy of "PC guy" employees dressed like the character in the television commercial.

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