Burberry CEO Angela Ahrendts has already made a name for herself elevating customer experience at Burberry. Can she do the same for Apple?
Apple's newest retail chief, current Burberry CEO Angela Ahrendts, in 2010
(Credit: Samir Hussein/Getty)
Amid the throngs of tourists, Apple's store in London on Regents Street is housed in a richly textured edifice, with the storefront ornately separated into four glass sections, each with its own Apple logo. Without those logos, you might simply walk by, ignoring the busy inside.
It's a stark contrast to the minimalist glass cube of Apple's Fifth Avenue store in New York City, and a good example of how Apple's built its 400-plus store empire. You can walk into any of the company's stores and walk out with the same gadget, but each store is unique.
Just down the street from that London Apple store is Burberry, which itself is fitted with luxurious finishings. But instead of polished, aluminum gadgets on wooden tablets there are handbags and clothes, wrapped in an air of elegance and warmth.
Those London stores could give us some insight into the mind of Angela Ahrendts, Burberry's chief executive who was just named Apple to run its retail empire. Ahrendts, who's been Burberry's CEO since 2006, brings the understanding of an emotive shopping experience -- something that Burberry exudes, and Apple is hell bent on preserving.
London Regent Street Burberry and Apple stores
(Credit: Apple/Burberry)
"Clearly, Apple stores are phenomenally successful. But in the past four or five years, I don't think they've been contributing to the actual building of the brand," said Neil Stern, senior partner at McMillan Doolittle, a retail consultancy. "I think she can make that connection much more direct."
Apple had been looking for a new executive to head its retail efforts since ousting its former chief, John Browett, about a year ago. He was on the job just nine months. The position was left vacant after Ron Johnson, who conceived of the original Apple Stores with Steve Jobs, bolted to take the top job at JCPenney's, only to be ousted himself after he failed to revitalize the department store. Ahrendts will run both Apple's online and offline stores, reporting directly to CEO Tim Cook as a senior vice president. She is said to be starting in the spring.
Apple declined to make her available for an interview.
Angela Ahrendts
(Credit: Burberry)
Ahrendts, who was the highest paid CEO in the UK last year according to CNNMoney, grew up (PDF) in the small Midwestern town of New Palestine, Indiana -- which, as of the 2010 census, had a population of just over 2,000 people. She was brought up by a "spiritual mother and philosopher father," as she puts it, so it's perhaps not surprising that she places such a premium on intuition. At a TEDx talk in Hollywood in March, Ahrendts riffed on the power of "human energy": "Think of energy almost like emotional electricity. It has a powerful way of uniting ordinary people, their connected spirit, to do extraordinary things," she said.
It appears that energy is one of the things that attracted Cook to the Burberry CEO. In a memo sent out to the company introducing Ahrendts, Cook noted that she "led Burberry through a period of phenomenal growth with a focus on brand, culture, core values and the power of positive energy."
In Apple's case, the company's products already hit that growth spurt, which has slowed down some in recent months as the tablet and smartphone markets mature. What hasn't slowed is Apple's efforts to expand its retail empire. Last year the company opened up 33 new retail stores. That's down from 40 the year before, though many more of those stores are being built outside of the US, where Apple hopes to expand and diversify its sales.
And speaking of diversity, it might not be long before Ahrendts makes her mark on the physical stores themselves. "One of the challenges for the Apple Store is, the products really speak for themselves, so the retail experience gets kind of lost. For example, the iPhone itself is the main focus," said Stern. Coming from a luxury retailer, one of the changes Stern thinks we can expect to see with Ahrendts at the helm is more displays and focus on luring people in.
Apple, for its part, has experimented with this concept in recent years, tapping its own iPad tablets as tools to replacing static signage next to its products. The company's also pushed people to use its mobile phone application to let customers research and buy products as well as page employees to come to their help.
More recently, Apple's brought that same ethos to its products. The company's new flagship iPhone 5S, for instance, comes with a gold option, and the cheaper 5C comes in a rainbow of colors. That's in contrast to the black, white and gray that have made up the look and feel of most Apple products for the past decade.
Of course, just because Ahrendts understands the power of intuition, doesn't mean she's not fluent in data and technology. After she arrived at Burberry in 2006 from Liz Claiborne, she ushered in a new digital regime at the at the over-150 year old brand. She brought the company into the social era, offering Facebook fans exclusive goodies, and live-tweeting Burberry models right before they hit the runway. She also incorporated enterprise software like Salesforce and SAP into the company's operations, according to a June 2012 story in Fortune.
She even cultivated a chummy relationship with Salesforce's gregarious CEO Mark Benioff. He declined to be interviewed for this story, instead pointing to a tweet he blasted out with a glowing endorsement:
At Burberry, Ahrendts also helped to marry the online and offline world. Burberry's artofthetrench.com is a site that lets people send in pictures of themselves wearing the company's trench coats. Some items in London stores have RFID tags that let customers watch videos on their phones about how that item was made. And under her watch, the company also held a holographic in-store runway show in 2011 to celebrate the opening of its flagship store in Beijing.
With that said, Apple's already got much of that figured out from a buyer's perspective. It runs only occasional sales at its stores, and has turned even temporary online store downtime into news stories. People spend days, and even take time off work to be the first to buy its products when they go on sale, a process that itself has nearly reached logistical perfection. In that sense, Ahrendts' biggest mark -- changing what happens in the stock rooms and with employees -- might not even be seen in that window display.
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