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RadioShack Targeting Mobility Biz

9/11/2009 12:30:31 PM Eastern

New York - RadioShack has made mobility a cornerstone of its business model, and aims to be a national destination for cellphones, netbooks and all related services, chairman/CEO Julian Day declared.

In a rare public appearance, Day told investors at a Goldman Sachs retail conference here yesterday that mobility is "an increasingly central plank" in RadioShack's marketplace positioning, and that the company is working hard to obtain first-to-market products and technologies after being denied access to iPhone and certain early-launch exclusives.

"We're vitally interested in getting access to every and all new products," he noted.

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Day said mobility has supplanted the main A/V wall within the chain's 4,500 company-owned stores and will receive additional space allocations. In addition, RadioShack's new "The Shack" marketing campaign, which "strengthens and contemporizes the brand franchise," will further position the retailer as a mobility authority.

RadioShack faces stiff competition from a vast fleet of carrier-owned stores and Best Buy's new Best Buy Mobile departments and stand-alone shops. About the latter, marketing executive VP Lee Applbaum described the shops' intimate, small-box format and knowledgeable sales associates as a confirmation of RadioShack's own business model.

RadioShack has the added advantage of a longer track record in mobile, and remains the nation's largest retailer of cellphones, aside from the carriers, Day said.

Elsewhere, the legacy parts business, for which the company is still best known by consumers, will continue to be a key component of RadioShack's strategy, Day noted. The third leg of the assortment, he said, will be comprised of a catch-all "end-user" category that will feature "new, interesting and innovative product."

Day said his first priority as CEO was to get RadioShack's operational house in order before overhauling its marketing message. "I had been focused on making sure the company is financially strong with great operational effectiveness," he told investors. Now that cost control "is part of our DNA ... we're ready for the next step."

Applbaum said it is too early to judge the effectiveness of The Shack campaign as re-branding programs are long-term efforts.

Looking ahead, Day said he believes the economic recovery will be slower than analysts and the media are projecting, as access to home equity, which helped fuel consumer spending, "has gone away and there is no process in place to change it."

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