Retail success of Apple

As the former vice president of retail at Apple, Ron Johnson partnered with Steve Jobs to plan the first Apple store. Now the CEO of J.C. Penney, Johnson reveals why Apple stores work.

Writing about his efforts in fashioning the Apple store in a Harvard Business Review guest post, Johnson explained that a store has to do more than just offer products for sale. It has to create an experience--something that turns it into more than just a store.

"Any store has to provide products people want to buy," Johnson wrote. "That's a given. But if Apple products were the key to the stores' success, how do you explain the fact that people flock to the stores to buy Apple products at full price, when Wal-Mart, Best-Buy, and Target carry most of them, often discounted in various ways, and Amazon carries them all--and doesn't charge sales tax!"

The secret?

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It is iPad then Kindle Fire

Among future tablet buyers, 65 percent of respondents said that they are planning to purchase Apple's iPad, a ChangeWave Research study found. In no time at all, Amazon's Kindle Fire has been able to attract 22 percent of future tablet buyers. The Samsung Galaxy Tab line, which has been available for over a year, was only able to muster 4 percent demand among consumers looking to buy a tablet in the coming months. According to ChangeWave, no other tablet vendor was able to secure just 1 percent demand among consumers.

What tablets do consumers want to buy over the next 90 days?

(Credit: ChangeWave Research)

"The launch of the Amazon Kindle Fire represents a shot across the bow at Apple, who until now has almost completely dominated the tablet space," ChangeWave said today in a statement. "But the most immediate impact of the Amazon device is on the rest of the competition, where the survey shows it wreaking a devastating blow to a range of second-tier tablet manufacturers, including Motorola, RIM, Dell, HTC, HP and Toshiba."

Amazon is on tiny loss selling Kindle Fire

Tiny Short term loss. Huge Long term Profit? Time has the answer...

Amazon.com takes a hit with the sale of each Kindle Fire, but the loss isn't as bad as initially thought. A look at the build of materials and manufacturing costs concluded that Amazon spends $201.70 on each Kindle Fire, only slightly above its $199 retail price, according to research firm IHS iSuppli. The cost is lower than the nearly $210 estimate the firm initially placed on the device. 

As previously reported, Texas Instruments was a major contributor to the tablet.The Kindle Fire uses a TI application processor, as well as the power management device and audio codec.

The most expensive component in the Kindle Fire is the display and touch screen, IHS iSuppli said, noting that it cost $87, or nearly half the build of material cost. The display comes from LG Display and E Ink Holdings. 

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