Palm’s Pre Retail Strategy? Go Big

While Apple will no doubt keep the availability of its new iPhone devices exclusive to Apple retail stores, the online Apple store and its carrier partner, AT&T, Palm will be going the opposite route with its iPhone competitor, the Pre.
Palm’s retail strategy is to go big, and the Pre, when it launches on June 6, will be available not just through Palm and Sprint but at Wal-Mart, Radio Shack and Best Buy.
“Palm is about mass-market distribution; they’re about volume,” Roger Kay, president of Endpoint Technologies, told eWEEK. “There’s only so much room for an exclusive, cool company, and Apple has that position.”
Though Wal-Mart is thought of as down-market, said Kay, “It’s been stepping up its electronics aisle and taking on more premium products. It also wants a share of what Circuit City left behind,” when it declared bankruptcy last year.
“Volume is absolutely key if Palm wants to attract developers,” said Carolina Milanesi, an analyst with Garter. “Applications and ecosystems and the ultimate success of the device are dependent on that.”
The Wall Street Journal reported that Wal-Mart began receiving new interactive electronics displays in stores on May 18, and that Wal-Mart is ramping up to better take on competitor Best Buy on the electronics front.
“A few years ago, suppliers wouldn’t even consider us for these kinds of technologies-they’d take it to Best Buy. But Wal-Mart is where the consumer is going,” Kevin O’Connor, Wal-Mart’s vice president of consumer electronics, told the Journal.
Endpoint’s Kay says that large retailers usually want a SKU that’s exclusive to them. In this instance, where the Pre is being made widely available, Kay suggests Wal-Mart and the others may “have a little bundle that’s unique to them, a Wal-Mart version–The new Palm Pre with fill-in-the-blank.’ It could be applications, or a lower price point. But typically, they want some piece of it that’s not like everybody else’s,” said Kay.
“The key is that Wal-Mart has enormous distribution,” Kay continued. “And if you’re Palm, you want to get these into people’s hands.”