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Microsoft’s new flagship store sets bar high for tech giants

Wednesday 14 August 2019 Property DevelopmentRetail ConsultancyShopping Behaviour

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Alex Draper's picture
By Alex Draper

The battle ground is set!

The familiar red, green, yellow and blue squares of Microsoft now greet tourists and commuters alike as they claw their way out of the wretched underbelly of London via Oxford Circus underground station.

 

Yup, Microsoft’s first physical retail store in Europe has opened and, at almost 22,000 sq ft, is double the floor space of rival Apple’s flagship store located a mere 300ft away. David Porter, Vice President of Microsoft Store, explains how this is part of their vision for an omni-channel store presence. Our PCG team headed down to get a look inside and see how it compares to Apple’s flagship store.

 

 

 

Building brand equity - and maintaining it

We outlined three key areas that both stores have focused upon in order to build brand affinity, loyalty and an omni-channel retail experience. These are:

 

  1. Consumer Experiences - Engaging with consumers through interactive experiences is key to attracting customers and building brand affinity - shoppers want to be excited!
  2. Community Engagement - Giving back to the community forms trust and admiration amongst consumers, inspiring a generation to become interested in the tech industry and build brand loyalty.
  3. Product Showcasing/Customer Service – The ability to browse products online whilst in-store and share experiences through social media provides consumers with the omni-channel experience.

 

 

Microsoft sets the bar high

Walking in, you’re met with a dazzling wall screen that spans the entirety of the room. Look around and you’ll notice this store’s main attraction – the McLaren racing car simulator showcasing the new Forza Motorsport 7 videogame. A neat AR experience is also available, taking you back to Victorian era Oxford Circus – recalling the store’s rich historical location.

 

 

An impressive Xbox gaming lounge can be found on the first floor with rows of consoles ready to play. This is where the frighteningly titled “Acer Predator Thronos Experience” resides –  a terrifically expensive gaming experience featuring a vibrating leather seat, 3 screens and surround sound – yes, you can buy one! Only £30,000!

 

There’s also Microsoft’s ‘Community Theatre’, a classroom-style space for hosting free workshops, community events and small business support sessions, and the ‘Answer Desk’, a take on the Apple ‘Genius Bar’. The top floor caters for the corporate customer.

 

Microsoft Surface products are dotted around on wooden tables to try out (suspiciously similar to Apple’s product display design - coincidence?) and the experiences showcase their virtual reality headsets and Xbox consoles. The Xbox lounge in particular has a more showcase vibe compared to other gaming lounges, e.g. the GAME store in Soho, with a greater focus on hosting e-sports events – a relatively new trend in the UK. On our visit, many shoppers seemed to be on ‘big days out’ – the most valuable shopper mission to retailers. ‘Shopper Missions’ is a consumer behaviour tool built from CACI’s ‘Shopper Dimensions’ database – find out more about this insightful tool here.

 

 

Should Apple be worried?

A short walk down Regent Street will bring you across Apple’s flagship London store – originally the first in Europe when it opened back in 2004. A revamp of the 11,000 sq ft store in 2016 saw it roll out the brand’s new retail design concept, with a focus on community engagement and entertainment. The store feels spacious and modern, offering a pleasant area to relax. What becomes more obvious is that Apple have moved away from the sales-orientated design characterising older stores and have gone big on an aesthetic experience.

 

 

What’s most striking about this store is the gargantuan screen at the far end, an area called ‘The Forum’, an events space for up to 75 people, offering premiers of new content from iTunes and ‘Making Of’ short films giving an insight into production. This space more importantly hosts live acoustic performances and various creative workshops for the local community, including photography and film sessions with industry designers, along with music labs, using the latest Apple products. Also, ‘The Boardroom’ located on the top floor provides advice to business customers, entrepreneurs and developers, whilst ‘creative pros’ offer advice to the more artistic individuals.

 

The central areas showcase products on the classic wooden tables, some being untethered. They also seem to be delivering very specific consumer targeting - for example, teaching parents about the new screen time feature on the latest iPhones, with the ability to restrict screen time for their kids - part sales pitch, part product feature showcasing. It feels as though Apple are widening their audience by offering much greater support sessions to understand their products better and people seem genuinely interested to engage.

 

 

The power of location

Microsoft have finally arrived on the UK omni-channel retailing scene with the opening of their new store. However, it seems they have taken many pages out of Apple’s store design manual. All in all, Microsoft’s new store offers much more interactive and exciting experiences for shoppers. That said, Apple offer a fantastic array of workshops to get hands-on with their products and are better connected with the local community, creating buzz about the store. Microsoft’s store suggests a more entertainment-based agenda, with Apple’s store focusing on showcasing product features with a strong emphasis on community engagement.

 

Since Apple’s flagship store opened in 2004, they now have 38 stores across the UK. It’s not inconceivable that Microsoft could follow suit. One of the primary reasons Microsoft may be looking to expand into the physical store network is because of the impact they can have on online sales. Research by CACI has shown that within a store’s catchment area, online sales can more than double, and in the case of consumer electronics, can increase by up to 154%. Dubbed the “Halo Effect”, you can check out the full infographic produced by CACI.

 

Given CACI’s research, it’s no wonder Microsoft are going big on consumer experiences – as are other retailers in the West End. For them to keep up in this dynamic environment, they must offer consumers more than just browsing opportunities.

 

To find out how you can use CACI's data and insight - combining Acorn, mobile data and spend data - to paint a picture of people and place in a digital world, get in touch today.

Microsoft have entered into the physical retail space arena - and only 300ft from rival Apple's London flagship store. We compare the stores as they balance experience, community, tech support and sales. Let battle commence!

Microsoft’s new flagship store sets bar high for tech giants