Circuit City CEO Pitches Concept Stores

By Linda Haugsted, Multichannel News -- TWICE, 7/31/2007 12:50:00 PM

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Special From TWICE sister publication Multichannel News
Washington -- The CEO of Circuit City Stores pitched cable-operator partnerships here, describing the concept stores the retailer is testing in partnership with companies including Comcast and Ethan Allen furniture stores in an effort to provide a more complete customer experience.

(For details on Circuit City's plans with Ethan Allen, click here for a report from TWICE sister publication Furniture/Today.) 

Phil Schoonover told the CTAM Summit audience that the multiple truck rolls caused by the average electronics partnership is not good for the consumer or provider. With partnerships, Circuit City associates could sell entertainment and HDTV sources in the store with the hardware and the retailer’s service division, firedog, could provide the installation and help, he added.

Circuit City wants a seamless multiplatform buying experience for consumers, 70% of whom now start their buying experience with research or ordering on the retailer’s Web site, he said.

Concept stores include “The City” in Virginia. Schoonover demonstrated a customer experience where a buyer is approached by a sales associate with a tablet PC. The associate uses the computer to hone in on the buyer’s needs: Which room will house the TV? Where will the hardware be placed? The PC enables the associate to sketch the room, placing furniture and determining what type of TV is best: LCD in Schoonover’s case, due to bright daylight in the room.

The associate also determined the buyer’s cable, phone and Internet providers and suggested that the consumer could save money with a Comcast triple-play. The associate then scheduled the hardware delivery and cable-services installation, along with a firedog services upgrade.

In Boston, the retailer partnered with Ethan Allen to sell hardware in conjunction with home furnishings and decorating services.

Another concept test, in Massachusetts, is “Connect,” powered by Circuit City and Comcast. The storefront has a boutique feel, with the buyer and associate seated on couches to envision the products in the consumer’s home.

Schoonover said the retailer will have 38 concept stores open before the end of the year, adding that Circuit City needs partners in the battle against the competition (other big-box stores for the retailer, telcos and satellite for the cable industry). Those partners need to engage in national co-selling programs to avoid “regional bureaucracies,” he added.

Circuit City has 650 retail locations. With all of its TVs turned on all day, that equals 90,000 potential billboards for cable-provided services, he suggested.

Given competitive pressures, “We’re both on a burning platform,” he said of the retail-electronics and cable businesses. “We can work together to get off that platform,” he added, by acquiring new customers together and enhancing the experiences of those buyers.