The Genius Of Retail

“Shop Different

 

By Ron Johnson with Zander Nethercutt

 

Harper Business, 320 pages, $32

 

Apple has become one of the world's most valuable companies because of its products: the Mac, the iPad, the Apple Watch and most especially the iPhone. But the company's product sales have been aided over the past 25 years by the presence of its iconic brand in more than 500 retail stores scattered across 27 countries and regions. Anyone who has ducked into an Apple store for a new iPhone or toted a broken Mac through the mall for a repair appointment at the Genius Bar has experienced what Steve Jobs and Ron Johnson built.

 

In "Shop Different: How Retail Revealed Apple's Genius," Mr. Johnson details the remarkable story of how, in 1999, Jobs recruited him from Target to join Apple as head of retail and launch perhaps the biggest long shot of Jobs's entire tenure as chief executive. At a time when computer stores were a moribund category and Apple's brand was near its lowest ebb, the two men concocted a daring strategy: find some way to connect with the millions of consumers who had no interest in or understanding of Apple's products.

 

Mr. Johnson cuts the profile of the perfect retail executive. Born in Minnesota, he was entranced as a child by the Midwestern, midcentury power of Dayton's department store. After Harvard he eschewed an obvious career path into finance and instead took a job at Mervyn's, a West Coast department-store chain owned by Dayton's parent, Dayton Hudson Corp. (now Target). From there it was on to the Target stores themselves. Mr. Johnson transformed the chain's toy departments by devoting an entire aisle to Lego products.

 

When Apple hired Mr. Johnson in 2000, he was based in Minnesota and didn't own a computer. (Jobs sent him an iMac.) But Mr. Johnson had retail experience Apple lacked, and Jobs seems to have identified in Mr. Johnson an enthusiasm for the project that matched his own. Apple had only recently avoided bankruptcy. Jobs was persuaded that a retail presence would be vital to the company's comeback.

 

The CEO was making a gamble, but he and Mr. Johnson realized that to rebuild the company's profile Apple needed to reach the regular people who shopped at places like Target. "Most of our future customers will be introduced to Apple through the store," Mr. Johnson recounts saying to Jobs. "So, eventually, it will become the most powerful physical expression of the brand."

 

They agreed to model the store's approach to customers on the Ritz-Carlton hotel chain, rather than a traditional retail outlet, which led to the concierge-like experience of the Genius Bar.

 

It's hard to imagine now, but in the late 1990s Apple products had little luster. As computers running Microsoft's Windows 95 took over the world, Apple seemed dedicated to selling niche products.

 

Jobs's return to the company in 1997 and the introduction of the iMac (Apple's first hit product in years) started to change perceptions, but Apple needed to reach buyers beyond its loyal base. Mr. Johnson knew where to find those people -- in America's shopping malls.

 

Jobs brought his trademark product-development focus to Apple's retail stores, joining Mr. Johnson for regular drives to a warehouse in which a secret mock-up of an Apple store would regularly be revised. At one point after most design decisions had been made, Mr. Johnson realized that a forthcoming new product strategy -- the "Digital Hub," which positioned Apple's computers at the center of a constellation of digital cameras, music players and accessories -- required a complete rethink of the retail operation. Jobs was furious, until he thought about it -- at which point the mercurial CEO changed his opinion. "Ron thinks we've got it all wrong.  And you know, he's right," Mr. Johnson recounts Jobs telling Apple's retail team.

 

The success of the strategy was hardly a fait accompli. Many stores struggled until Jobs's product pipeline came to the rescue. With the introduction of the iPod music player in 2001, Apple had a product that made even Windows users curious enough to wander into an Apple store. Under Mr. Johnson's watch, Apple's retail division became a behemoth operation, selling millions of iPods, iPhones and Macs while opening stores around the world.

 

For a generation of people, the iPod was the first Apple product they ever bought. Those buyers frequently ended up buying Macs, and the arrival of the iPhone converted even more customers. It's hard to imagine Apple's rise to a trillion-dollar company happening if its products weren't readily available in local retail stores.

 

Jobs and Mr. Johnson were kindred spirits when it came to strategy, but temperamentally they were a mismatched pair -- California tech and Midwestern retail. The book details Mr. Johnson's belief in a Christian view of love and service, which informs his understanding of how to treat customers and co-workers. The cynical and secular Jobs didn't seem to entirely get that. Mr. Johnson recounts upbraiding Jobs at one point after the CEO swore at and insulted his retail team during a meeting; he made his outspoken boss promise never to do it again.

 

Mr. Johnson doesn't spare himself from questioning one of his worst decisions, which was to leave Apple in 2011 for the struggling retailer JCPenney, a move that even at the time seemed misguided to market observers. The book recounts his temptation (after 12 years at Apple) to lead a company himself, a choice made exponentially more difficult because of Jobs's terminal cancer diagnosis.

 

But having read "Shop Different," it's easy to understand why a Midwestern kid who was dazzled by department stores might want to take a chance on one of America's most storied 20th-century retail brands. Maybe he didn't realize at the time that he'd already helped create one of the 21st century's best.

 

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Mr. Snell has written about Apple for 30 years and is the co-host of Designed in California (designed.fm), a podcast about the company's history.” [1]

 

1. The Genius Of Retail. Snell, Jason.  Wall Street Journal, Eastern edition; New York, N.Y.. 01 Oct 2026: A13.