This was exactly the reasoning of the high-end hi-fi retailer B&O - they opened flagship stores around the world, and it didn't turn out well.
Re:IPad's Rivals Can't Beat It on Price
by silvestrov on Monday March 07, 2011 @12:46AM
(#2296188)
The problem is that B&O doesn't sell anything that young people are interested in. So they don't have the same amount of traffic (of people buying stuff) in their stores.
They have 2 major product lines:
1) Why pay 3-5 times as much for a simply rebranded Sony tv? In old days B&O made their own electronics, but todays B&O tv is just a standard display wrapped in a B&O plastic frame and is no better than a standard Sony TV.
2) hifi sets (cd-players, tape recorders, vinyl players, etc) are obsolete because young people have all their music on their iPod/computer.
B&O is a company that sells quality horse wagons in a time when young people have switched to cars.
The Apple store gives Apple promotional and marketing support, it is a support venue. The customer walks in to an environment designed to promote Apple products not dishwashers, Xooms and Xbox 360s.
Things might go sour at some point, but Apple is sitting on $50 billion in cash and liquid assets, even if everything went south sales-wise, the advantages of exclusively promoting their products is probably worth it to them.
Their retail partners have been fair-weather friends and more likely to be a negative factor if things went sour than any fixed costs of running the stores.