[WN]-Microsoft has decided to permanently close all of its retail stores. Microsoft said the company's retail members will continue to serve customers from Microsoft corporate facilities and remotely providing sales, training, and support.
Back in 2015, Microsoft opened its flagship physical store just five blocks away from the iconic Apple cube in Manhattan. Featuring both Surface products and a curated set of partner hardware, it seemed a warning shot a statement that the company was getting serious in its efforts to rival Apple’s mindshare.
Today, less than five years later, Microsoft announced it will be closing all of its physical stores, at least in its current form. The company plans to ‘reimagine’ four locations London, NYC, Sydney, and Redmond as ‘experience centers’ (AKA showrooms) rather than actual stores.
While the company doesn’t explicitly say the closing was precipitated by the coronavirus pandemic, it’s hard to imagine it not having an impact. The company did say that since it closed its stores at the outset of the pandemic, its retail team has been working to help customers transition to the new reality of online workplaces and schools.
Microsoft has decided to permanently close all of its retail stores. Microsoft said the company's retail members will continue to serve customers from Microsoft corporate facilities and remotely providing sales, training, and support.
The company will continue to invest in its digital storefronts on Microsoft.com, and stores in Xbox and Windows, reaching more than 1.2 billion people every month in 190 markets, the American multinational technology company said in an official release today.
Microsoft has 83 stores worldwide, including 72 stores in the U.S and several others abroad.
The company said it will also reimagine spaces that serve all customers, including operating Microsoft Experience Centers in London, NYC, Sydney, and Redmond campus locations.
It said the closing of Microsoft Store physical locations will result in a pre-tax charge of approximately $450M, or $0.05 per share, to be recorded in the current quarter ending June 30, 2020. The charge includes primarily asset write-offs and impairments.
Microsoft Corporate Vice President David Porter said: "Our sales have grown online as our product portfolio has evolved to largely digital offerings, and our talented team has proven success serving customers beyond any physical location."
“We are grateful to our Microsoft Store customers and we look forward to continuing to serve them online and with our retail sales team at Microsoft corporate locations,” he said.
Shares of Microsoft were down about 1.5% mid-morning on Friday.
Further, the company said the retail team has helped small businesses and education customers digitally transform, also virtually training hundreds of thousands of enterprise and education customers on remote work and learning software.
“We deliberately built teams with unique backgrounds and skills that could serve customers from anywhere.
The evolution of our workforce ensured we could continue to serve customers of all sizes when they needed us most, working remotely these last months,” said Porter. “Speaking over 120 languages, their diversity reflects the many communities we serve. Our commitment to growing and developing careers from this talent pool is stronger than ever.”
The retail team members will serve consumers, small-business, education, and enterprise customers while building a pipeline of talent with transferable skills.
“The Microsoft Store team has long been celebrated at Microsoft and embodies our culture,” said Microsoft Chief People Officer Kathleen Hogan. “The team has a proven track record of attracting, motivating, and developing diverse talent. This infusion of talent is invaluable for Microsoft and creates opportunities for thousands of people.”
With significant growth through its digital storefronts, including Microsoft.com, and stores on Xbox and Windows, the company will continue to invest in digital innovation across software and hardware. New services include 1:1 video chat support, online tutorial videos, and virtual workshops with more digital solutions to come.
“It is a new day for how Microsoft Store team members will serve all customers,” said Porter. “We are energized about the opportunity to innovate in how we engage with all customers, maximize our talent for greatest impact, and most importantly help our valued customers achieve more.”
Rather than physical retail locations, Microsoft plans to instead invest in services such as 1-on-1 video support, more tutorial videos, and virtual workshops.
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