Intel Retail Fronts: A Waste of Money?

By Doug Mohney November 15, 2013

Apple started the store craze. Then Microsoft decided it needed a unique consumer presence. Now Intel is the latest company deciding it needs a store front to get in touch with the people. Really? It's an odd move at best and a waste of money at worst. 

Intel's first pop-up retail store is going up in New York on Nov. 13. The Intel Experience Store, to be joined by others in major markets such as Chicago and Los Angeles, has bold ambitions.

"We are redefining retail and intend to reshape the consumer experience," says an Intel flack on a company video promoting the launch of its store. Perks include free coffee, free movies on Fridays, guest speakers from the community, and in-store experts to allow people to check out devices and order them online from within the store.

With the exception of the coffee, movies, and guest speakers, the consumer "experience" sounds a lot like a visit to an Apple Retail Store. Oh wait, I can go to an Apple Retail Store and actually BUY things or pick them up at a store front after I've shopped on line.

Perhaps the key here is "experience." Maybe Intel feels it needs to provide a more touchy-feely experience than generic big box stores are delivering these days. I'm not getting free coffee from Best Buy and have to say the generic PC and laptop exhibits are overwhelmed by Apple's big white pop-up area and the rows of (typically ARM-powered) smartphones and tablets at the front. 

If you view the Intel Experience Store in terms of "oooh-ahh" marketing to generate buzz, I suppose it is better than big box experience, but it's also going to be expensive to setup and sustain. It might have made sense to sell Intel's On Que TV service, but that looks to be a muddle prospect with On Que being shopped to Liberty Global and Verizon this week.

Without a true direct-to-consumer play, the Intel Experience Store is a fish out of water. Microsoft can justify a retail presence to showcase software and its tablet hardware. Google's floating expo barges are necessary to show off its branded smartphone and tablet products -- Nexus and Moto -- along with educating people on Glass and other wearable tech the company is bringing to market.

Consider if a person goes into an Intel Experience Store, plays with a Microsoft Surface or HP 2-in-1 tablet/ultrabook combo, then orders it on-line in the store. Intel has spent some number of marketing dollars – not pennies, dollars – to move a single piece of hardware, adding to the marketing co-op money already spent with its partners to promote "Intel Inside" and ultrabooks and 2-in-1 and whatever comes out next week.

Can Intel really move enough units through its Experience Stores to make them cost effective? I'm doubtful. It's a good thing the chip manufacture has money to burn.



Contributing Editor

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