Apple's innovations can be translated to restaurant industry

Apple's innovations can be translated to restaurant industry
Tags: Business Strategy and Profitability, Customer Service / Experience, Online / Mobile / Social, Operations Management, Restaurant Design / Layout, Staffing & Training
June 20, 2011 - Darrel Suderman

Have you ever walked into an Apple Computer retail store and noted all of the ways the company has revolutionized customer service, and achieved $5,914 sales per square foot?

A June 15, Wall Street Journal article titled "Secrets From Genius Bar: Full Loyalty, No Negativity" references these successes. However, the title doesn't reflect the true value of the article, because it is really about all of the innovation changes that Apple Computer has brought to their relatively new retail stores. Let's take a deeper look, and try to learn some basic innovation principles that can be applied to the restaurant industry.

First, Apple's retail concept was started out of a need to expand its product awareness to its customers. Apple was not happy with prior results from display areas in Best Buy and similar retail stores. So the company decided to take on the challenge of developing retail brick and mortar stores that met its needs while other brick and mortar stores were declining in sales.

Apple's response used classic "innovation principles." The company began by hiring an outside retail executive with a fresh perspective on the innovation that would be needed to achieve its business goals. But they didn't hire someone from the tech industry; instead they hired Millard Drexler, then-president of GAP to join the board and advise on retail strategy. What reflects classic innovation is that Apple essentially developed a "Dedicated Innovation Team" with a separate reporting structure – and hired people with an outside or out-of-the-box thinking.

A few of the innovative principles that Apple applied to its retail stores could be applied to the restaurant industry:

Apple is considered to be a pioneer in many customer service and store design areas. Apple's retail stores are constructed with airy interiors and attractive lighting to project a carefree and casual atmosphere. Apple designed its stores with an open plan and a clutter-free look – using natural materials such as wood, glass, stone, and stainless steel.

Its innovative sales philosophy is not to "sell," but rather help customers with their problems. The employee's job is to understand all of their customers' needs. Employees are not rewarded with sales commissions, but must sell service packages with devices. Those who don't meet sales targets are then retrained before they are dismissed.

Apple constantly evolves its stores' "look and feel," versus other retail stores that develop a prototype and then roll it out nationally. Apple invented the "Genius Bar" (even the name is innovative) where licensed and trained employees troubleshoot customers' Apple products. Cash registers are in the process of being phased out so that customer transactions can be completed anywhere in the store using iPod Touches with a credit card reader and software that remotely opens hidden registers throughout the store.

New products are located on the first floor at the front of the building so that employees can cheer and clap as customers walk out with their purchases.

Personalized "set-up" areas exist where customers get assistance setting up new devices. This helps business in two ways: It provides an incentive for customers to buy products in Apple stores and reduces problems related to set-up, which are among the most frequent reasons for visiting a store's Genius Bar. This sounds like fixing a problem before it actually begins, which is a proactive business process.

Apple also rolled out a service called "Joint Venture" to provide a separate program for business customers.

In summary, Apple has successfully implemented these innovative retailing principles to drive its retail sales to almost $6,000 per square foot. And most, if not all, innovation principles were developed to identify and fulfill customer needs! It sounds simple, but most companies struggle with implementing innovation. I can't imagine any CEO who doesn't see $6,000 sales per square foot as the ultimate "carrot on the end of a stick."

The Food Innovation Institute now offers food innovation workshops and executive leadership training on food innovation at your Corporate Offices. For more information contact Dr. Darrel Suderman, president of The Food Innovation Institute at dsuderman@foodbevbiz.com (www.foodbevbiz.com).