Apple Stores Will Be Just Fine Without Ron Johnson
“I sat in a room with Steve, and he put on the table Apple’s product line. And we had four products, two portables and two desktop computers. The iPod wasn’t created yet. And that was a challenge (with only four products). But it ended up being the ultimate opportunity, because we said, because we don’t have enough products to fill a store that size, let’s fill it with the ownership experience. So we quickly moved from a buying experience to an ownership experience–Genius Bars, theaters, and face-to-face help and friendly people. But we had a liberty that most retailers don’t have that are overstuffed with products. You know, you don’t have the space to innovate.”
That’s how much J.C. Penney added to its market cap Tuesday by announcing it had poached Apple retail guru Ron Johnson to become its future CEO.
And for good reason: In retail, Johnson’s record is without rival. Under his leadership, Apple has opened 324 stores since 2001 and is scheduled to open about 40 more this year. According to Barclay’s analyst Ben Reitzes, sales through Apple’s retail stores will likely exceed $16.5 billion this year and grow to over $20 billion in fiscal 2012. As Needham analyst Charlie Wolf told AllThingsD, “Ron is arguably one of the great merchants in America. He and his team basically reinvented the retail concept in the Apple Stores.”
So it’s true that Johnson’s departure is a loss to Apple — a meaningful loss.
But beyond the search for his successor, it really doesn’t change anything.
Certainly, it’s not going to make Apple any less of a retail phenomenon. The company’s strategic direction in that space is set. And Johnson leaves behind him not just a team fully capable of executing it, but a retail business that today is the fourth fastest growing in the world, according to the National Retail Federation.
In other words, the hard work of conceiving and executing Apple’s retail strategy is done. And with the company adding more and more stores, particularly in eager new markets like China, there seems little chance for disruption in growth or performance — certainly not with Apple’s current product line, which continues to draw massive crowds to its retail stores in the States and abroad.
Which brings me to my final point. There’s no question that the decade Johnson spent shaping Apple’s retail strategy was critical to the company’s renaissance. But it’s important to remember that decade was also the one that birthed the iPod, the iPhone and the iPad. It’s those innovative products that played the biggest role in Apple’s retail success and will continue to drive it going forward. And they’re not going anywhere.