Microsoft stores are (almost) no more

Microsoft have announced they’re shutting all their stores worldwide, although they’re retaining the following four as “experience centres”:

• New York City
• London
• Sydney
• Redmond (Microsoft Campus)

Microsoft stores always seemed like an attempt to keep up with Apple – they looked pretty similar and, in many cases, they were physically located very close to Apple stores – and I’m not sure how integral they’ve really been in terms of sales etc. I’ve only been to a couple – one out in Virginia and the other (I think) in LA and, to be fair, they were pretty cool. That said, I think the biggest benefit of stores is to check out the hardware – click the buttons, pick it up, feel the screen etc. and between places like Currys PC World and the “stores” Microsoft have within John Lewis, I think most places in the UK have the ability.

I also think a big part of the stores was to raise consumer awareness of Microsoft. It was certainly the case that their general level of recognition had dipped with many non-tech consumers and also their reputation wasn’t always the greatest. The stores gave them an opportunity to be seen by people who weren’t already looking for them, for the casual mall browser to “pop in” and take a look around, for the Xbox buyer to also see what else Microsoft had to offer. Now, several years later, it’s clear to most that Microsoft’s position is much improved. The Surface range is well known and Teams has given them broad appeal across many types of staff – and the public sector too.

Some are saying that Microsoft are “giving up on consumers” but I think it’s more a case of going where the consumers are. Online shopping was already the “go-to” for many in 2019 but COVID-19 has increased that significantly and, while some will rush back to the crowded shopping centres and malls, many will not. For a lot of people, they’ve realised that buying things online works very well and, making sure you choose places with a sound returns policy, even changing your mind isn’t much of a problem really.

Microsoft will take $450 million hit on this but that’s not really a huge amount for them. As long as they have a clear strategy for how they will continue to engage with users online, I don’t see there being much downside to this really.