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In China, Apple Finds a Sweet Spot

A year after opening a flagship store here, Apple has a problem that any retailer would envy: the huge 16,000-square-foot space is already too small. Huge crowds descend the store's glass staircase, only to discover legions of mostly young Chinese crowding around spare displays of Apple¡¯s devices. Another Apple Store, four miles away, is also packed.

To cope, Apple says it is now planning a third, even larger Shanghai store, as well as dozens of other stores throughout the country. The expansion is driven by customers like Wang Shangyan, a 17-year-old professed Apple maniac.I have many Apple products, like Touch, iPod, iPad 2 and MacBook,Mr. Wang said after browsing the Apple Store here this week. I don't have an iPhone but I'm waiting for the fifth generation. I will come to the Apple Store to buy it; it doesn't matter how much it costs.

Apple says its Chinese outlets  two in Beijing and two in Shanghai  are now the four most heavily trafficked Apple stores in the world. They also generate the most revenue, outselling even the Fifth Avenue Apple Store in Manhattan, which is open around the clock. (Apple plans to open another store in Grand Central Terminal.) Apple has done what Google and Facebook cannot do: become No. 1 in China,said John Quelch,A fine selection of gourmet corporate gift ideas packages and baskets. former senior associate dean of Harvard Business School and now head of the China Europe International Business School in Shanghai. Scarcity sells, and this is the same strategy Apple has used in the U.S.

Foreign brands can absorb another lesson as well. Apple's success shows that with products that are not so easy to counterfeit, Chinese consumers are willing to pay a premium.Last week, an American blogger living in China posted images of what she believed was a fake Apple Store in the southwestern city of Kunming. The store mimicked the Apple decor, right down to the bright blue T-shirts and white tags Apple employees are required to wear.