twice connect
careers

CompUSA To Focus On Business Channel

5/22/2007 08:13:00 AM Eastern

Dallas — CompUSA has confirmed that it will no longer serve a mass consumer audience under a new business strategy that the company formally unveiled today.

Under the plan, first reported last month in TWICE, the computer specialty chain will focus mainly on small and medium businesses, and will also offer products that appeal to “technology enthusiasts” and “educated professionals.”

The company said it identified those groups through market research as its core customers, and will adjust its product assortment, increase its technical services, tailor its marketing and explore new store formats to better serve them.

“We’re moving in a new direction to deliver the right mix of products and services to provide greater value to our core customer base,” said CompUSA president/CEO Roman Ross. “Our goal is not to be everything to everyone. We’re focusing our efforts on the customer base that best aligns with our clear value proposition.”

The move is part of a comprehensive restructuring, initiated in February, which included an overhaul of senior management and the closing of half its store base as the privately held chain struggles to improve sales and profitability.

Its plan for the business channel includes increasing the number of commercial grade and trade-specific products, such as commercial-level laser printers, dot matrix printers and POS machines. The company will also provide “complete technology solutions” for small and medium businesses, and is testing a new store format that will include a designated section for those customers.

Other elements of the strategy include offering free informational and solution-based in-store seminars and events geared at educating small business owners and their employees, and providing its own staffers advanced technical training and certification programs “to further enhance the customer experience and ensure the company has the most highly trained workforce in the industry,” CompUSA said.

“We believe we are meeting a key market need by providing this core group of customers with brick-and-mortar locations to see, learn and experience the latest technology that fits their clear need to be more productive, reduce cost and reduce risk,” Ross said.

CompUSA has long catered to the small business community, and even predated Geek Squad with its own IT services program called The Techknowledgists. But according to Steve Baker, industry analysis VP for The NPD Group, its efforts were diffused by its mass-market orientation, and by later attempts to integrate A/V products into the mix. “They tried to be everything to everybody, and didn’t really commit to one approach for small and medium businesses,” he said.

This time, Baker believes, CompUSA will likely employ a local market strategy to support area businesses with hardware and services, which should be easier to accomplish from a smaller store base.

A first step in this direction came earlier this year through a partnership with Microsoft called the CompUSA TechPro Business Providers program. The initiative complements the retailer’s current technical services offering and links CompUSA business customers with Microsoft’s small business consultants to provide “complete technology solutions” for local businesses. CompUSA said that in addition to the services already offered at its remaining 103 stores, its business sales teams will continue to serve small businesses in the 29 cities that were affected by recent store closures “due to customer demand and the success of its technology support program.”

On the consumer front, the company will narrow its focus to early adopters and educated professionals who are comfortable with using high-end business products and are more apt to purchase them for home use. To target these customers, CompUSA will launch new marketing initiatives later this year in stores, on the Web and through its promotional materials, the company said.

At last month’s Spring RetailVision event, CompUSA e-commerce director Landon West noted that the chain will reduce its SKU count in order to concentrate on high-turn, high-margin products falling within the IT, entertainment, and technical parts and services categories. He acknowledged that the company lost its way by adding new products, categories and services in a somewhat haphazard fashion, and through some poor real estate choices.