He actually goes into depth about why Apple stores were necessary in a talk he did at MIT in 1992 . Was it that he was not nearly as articulate in person with his team, as he was in this video?
Luckily, the transcript is available. The money quote is:
" ... current distribution channels for the computer industry over the last several years have lost their ability to create demand. They can fulfill demand, but they can't create it. If a new product comes out, you're lucky if you can find somebody at the computer store that even knows how to demo it. So the more innovative the product is, the more revolutionary it is and not just an incremental improvement, the more you're stuck [in getting people to try learn about it enough to try it out]."
Here's a fuller quote:
There are some things I can't talk about here. In addition to that, if you look at how we sell our computers right now, we have a sales force in the US of about 130 professionals in the field out selling NeXT computers. They spend 90% of their time selling NeXTSTEP software, and then 10% of their time selling the hardware.
In other words, if they can get the customer to buy into NeXTSTEP, then they're going to sell the hardware, because right now we have the only hardware it runs on. So they are out there selling NeXTSTEP right now. And this is what is required to launch a new innovative product. The current distribution channels for the computer industry over the last several years have lost their ability to create demand.
They can fulfill demand, but they can't create it. If a new product comes out, you're lucky if you can find somebody at the computer store that even knows how to demo it. So the more innovative the product is, the more revolutionary it is and not just an incremental improvement, the more you're stuck. Because the existing channel is only fulfilling demand. Matter of fact, it's getting so bad, that it's getting wiped out, because there are more efficient channels to fulfill demand, like the telephone and Federal Express. So we're seeing the channel become condensed on its way to I think just telebusiness.
So how does one bring innovation to the marketplace? We believe the only way we know how to do it right now is with the direct sales force, out there in front of customers showing them the products in the environment of their own problems, and discussing how those problems can be mated with these solutions.
It gives me new perspective on the value and purpose of the Apple Stores, which I previously viewed as just a luxury shopping experience as window dressing on the usual consumer electronics buying experience. That's still a big part of it, but your quote explains the deeper value.
It also explains to me why Microsoft chose to follow suite with their own Microsoft Stores, although I still wonder why theirs aren't as successful. It's always amusing and a bit sad to go to the Valley Fair Mall in Santa Clara, where the Microsoft Store is literally right across from the Apple Store, but Apple is packed where Microsoft is a ghost town. What secret sauce are they missing? My thought is that the Microsoft brand is still poison to the average consumer.
In the old days, a Thinkpad or Toshiba Tecra were only seen by commercial accounts and college kids. Your only way to see and touch an expensive ($2k in 98-2000) purchase was some awful bolted down display at CompUSA or BestBuy. And you only saw shitty consumer product, and were stuck dealing with a salesman of questionable knowledge looking for a warranty spiff.
The Microsoft vs Apple store thing is easy — they are selling the same dreck, spiffed up with a few first party products.
Steve put so much effort into giving Apple products life, figuratively. For example, he would call the iphone, "iphone", not "an iphone" and was adamant about it. Almost giving existence to it. Also, the way he introduced products was brilliant. He was a master at teasing the public and peaking interest prior to product launch.
Where Microsoft would release products akin to the Zune..in brown, or products with unmemorable names like 'Surface Pro x', with very little marketing. I've always thought MS has interesting products and they have been first to market many times. However, due to lack of marketing, they didn't gain traction.
I remember someone on ESPN segment which had been sponsored by Microsoft and the people on the screen were using MS Surface but the commentator said we are using an Ipad like device.
I guess MS needs some innovate ads which will tell people what MS does in the consumer space.
I mean: "iPad" is two syllables, short and sweet, and MS wanted people to call the devices the "Microsoft Surface Pro," six syllables that don't exactly roll off the tongue.
That's not even getting into how they packaged all of those Surface Pros in gigantic blue padded cases, giving the impression that Microsoft's version of the iPad was big and clunky. Necessary for use on the sidelines, I'm sure, but not well thought out.
I just found this out recently too, not a new member either!
Stealth prediction of Amazon. If you know what you want, you order it online (until Amazon kills itself with counterfeits.) If you don't know what you want, you go to a store.
-3rd party Amazon seller.
The software was fantastic, and thankfully Apple acquired NeXT, but let's be honest: if NeXT hadn't been acquired (by somebody) their days were numbered.
Official figures are hard to come by but estimates suggest that NeXT sold about 50,000 units over its entire lifetime. The company had to stop manufacturing hardware and was very much dying.
You could classify the deal with Apple as a merger in that both companies were in a certain amount of trouble by that point and needed eachother (or some other merger partner) for survival, but Apple had a lot more runway. They did, after all, hand over $429 million in cash for NeXT, plus some quantity of shares.
NeXT technology didn't just overcome technical debt, it became a solid foundation for over two decades worth of cutting-edge software, hardware and product development by Apple. It remains one of Apple's greatest technical assets. But again, the technology alone would not have fundamentally changed Apple's 1996 market position.
Apple's market position was turned around by Steve Jobs, the "freebie" included in the NeXT acquisition.