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Disney Opens First Apple-Inspired Store

July 6, 2010

By Tom Ryan

The Walt Disney Co. last week opened the first of its 300 planned revamped Disney Stores in Montebello, CA. Inspired by Apple Inc.'s design team, the store features multimedia technology and interactive storytelling with a goal of keeping shoppers entertained for 30 minutes.

Among the features of the 4,800 square foot store:

A Pixar RIDEMAKERZ area that allows people to assemble and accessorize their favorite Cars character. A wide selection of rims, side pipes, hoods scoops, blown engines, spoilers and other accessories enables customer to customize the cars to their liking;
A child-sized Disney Princess Castle including a "Magic Mirror," in which a Disney princess can be summoned with a wave of the wand to tell stories to children;
A Disney Store Theatre featuring classic and new Disney entertainment. Customers can also use a touch screen to play music videos, movie trailers and other film shorts on a 12-foot screen in a gazebo-like theater enclosure. In the vein of Apple's lecture spaces, the theater will also serve for special in-store events such as reading time, scavenger hunts and other activities;
Touch-screen kiosks placed around the store give users the ability to navigate a 3-D animated view of all Disney Store and DisneyStore.com products and discover the latest Disney Store news via video clips, articles, and social media feeds. Customers can then share what they viewed online via e-mail, Twitter and Facebook;
Thirteen-foot trees surrounding the store are programmable with changing colors, images, and music set to an array of Disney themes;
A Pixie Dust Trail that leading guests through the store and the major interactive elements;
A scent, called "Imagination," supporting store ambience;
Employees carry miniature receipt printers for mobile checkout.

Due to mounting costs, Disney licensed most of its stores in 2004, including to The Children's Place in the U.S. But the company repurchased about 220 locations in 2008 while closing 100 doors in the U.S. in the process. Last year, it tapped proprietary information about the Apple Stores' development and operation and also hired Apple Store designers in preparing for a relaunch.

"The issue for Disney, compared to other retailers, is that they have to be extra good in stores, because their product is sold in other kinds of stores," George Whalin, a retail consultant and RetailWire BrainTrust Panelist, told MediaPost. But he added that hiring Apple's designers was "a stroke of genius." Combining the new interactive-elements with its character franchises and marketing clout, "they've got the wherewithal to do something truly magical."

Discussion Question: What interactive elements at Disney's revamped stores appear most promising? What will be the primarily hurdles in making Disney's revamped format work?

FINANCIALS: [NYSE:DIS]

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Comments:

What was missing in the original Disney stores was indeed the magic. They've brought it back in spades. I can only imagine the price tag to deliver this experience but will make them a real draw in all locations which landlords can rejoice in.

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Bob Phibbs, President/CEO, The Retail Doctor & Associates

The greatest asset that the new Disney stores possess is the influence of Steve Jobs. He is a master of creating a rich retail experience.

If Disney gives the new concept a chance, and I suspect that they will given that Steve Jobs is the largest shareholder, 5 years from now we will be talking about this period as a turning point for Disney retailing.

Retailing is theatre and entertainment, and no one knows better how to execute these two things than does Disney & Jobs.

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Joel Warady, Chief Marketing Officer, Enjoy Life Foods

Disney Stores are moving from 'selling chotchkies," like mouse ears and tees (we've all bought them), and have them stored in the attic, to using that marvelous DISNEY magic and innovation to engage the consumer.

In the process, they'll still move a fair amount of memorabilia, but they will capture a larger ticket, frequency, and enhance the 'brand'. Sharp move!

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Roger Saunders, Managing Director, PROSPER BUSINESS DEVELOPMENT / BIGinsight

Disney stores had the magic, then grew complacent and lost it. This new concept allows consumers, young and old, to interact with the company in a contemporary, fun manner; something that is missing in many retail environments. As Joel says, "Retailing is theatre and entertainment." Disney, more than any other company, stands for entertainment. This is a great step in recapturing its retail magic.

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Max Goldberg, Founding Partner, The Radical Clarity Group

It seems like we're missing a piece of the equation here.

You can have a "magical store experience" like Apple does, but you need to sell high-end items to make the cost of that experience pay off.

During one of my first visits to an Apple store (and I'm not much of an Apple geek at all), I plucked a $300 pair of noise-canceling headsets off a pegboard and bought it without a blink. I'm quite certain the margin on those headsets was $150 or more.

What kind of high-end products will the Disney store carry to generate those dollars? Is it going to be like the old FAO Schwartz, or are they going to make it up in volume? Can't tell based on the Children's Place management experience.

Until I understand that side of the equation, I can't predict the magic becoming a Golden Goose.

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Paula Rosenblum, Managing Partner, RSR Research

Love it! The 'old' Disney stores got so boring so fast. They were just product driven, and lacked any 'experience'.

The journey to Disneyland is a magical one, so the trip to their stores needs to hold that same magic. Good for them to step up...maybe more retailers will take note and focus on the experience, not just the price and the product.

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Kevin Graff, President, Graff Retail

I am excited to see what happens when Disney opens its first Apple-inspired store in Montebello, CA because I am inspired by the combination of these two companies pulling together!

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David Biernbaum, Senior Marketing and Business Development Consultant, David Biernbaum Associates

I can't wait to see and experience the new Disney store. Since I live here in Southern California, I'll get there soon!

George Whalin, President & CEO, Retail Management Consultants

The Disney name combined with the influence and Apple name can make re-opening and a sense of rebranding successful over time. I too wonder what products and markup will need to be sold to make it financially viable. The two names alone will bring the public in to look. And where there are lookers there are buyers.

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Ed Rosenbaum, CEO, The Customer Service Rainmaker, Rainmaker Solutions

Many (including myself) believe that Apple produced such an unbelievably successful store because they were not retailers and they did not rely on retail expertise. They built a "secret" prototype and tested it with consumers and took all their cues from consumers and they created a very "customer centric' environment without relating it to any existing stores. Their great products in limited numbers but presented in a new common sense way worked for them in unexpected and unprecedented fashion. But by acting now as retail consultants will they be doing to (or for) Disney the very thing they avoided doing when building their own store? Would Disney be better served going direct to the consumer and to their own products to (as Apple did) to get the best ideas for a new store?

Michael Tesler, Founding Partner, Retail Concepts

A trip to an Apple store is like no other, so I imagine a trip to a Disney store will meet the same criteria. I do like those mobile checkouts and printers. I'm just not sure about a store scent called Imagination.

One key to evaluating their success will be customer and employee feedback as well as dollar sales.

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Odonna Mathews, President, Odonna Mathews Consulting

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