Is this a sensible strategic decision by Microsoft?

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It seems like an odd decision - to launch a retail business in the depths of a global recession.  But that’s what Microsoft is planning…

The Guardian reports how Microsoft is planning to open a series of retail outlets to help it promote and sell its range of hardware and software products.

According to the official Microsoft announcement:

“The purpose of opening these stores is to create deeper engagement with consumers and continue to learn firsthand about what they want and how they buy”

It is likely that Microsoft is hoping to match the success of Apple which has successfully developed its own retail distribution whilst at the same time distributing products via direct and other intermediaries. Apple’s retail outlets achieving more than a billion dollars in sales within two years. There are now more than 200 Apple stores worldwide.

One of the issues that Microsoft will have to address is the risk that it will be competing with its existing retail customers.  This raises the prospect of “channel conflict”.  Much will depend on the scale and locations of Microsoft’s stores.  Opening a series of flagship stores in cities like New York, London, Beijing & Milan (a strategy adopted by the likes of Nike) probably does much more to raise the profile of the brand being sold - which should benefit all relevant retailers.

Microsoft’s move is bound to attract a lot of attention, not the least from the humour-merchants.

I liked this take on the announcement:

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