The closing of locations, lower sales for publicly held chains and the demise of entire retailers are always depressing — and never pretty.
Whenever these events get clustered in the electronics/ appliance business during the past quarter century (and they have several times), gloom and doom theories and opinions flow.
The recent series of bad news — the latest of which involves the closing of New York’s J&R Music & Computer World — have made some financial analysts and pundits go that route, predicting again in various degrees that all retail sales will go online in the near future.
When you read the special report by senior editor Alan Wolf, which analyzes the departures of J&R and American TV, store closings at RadioShack and Sony Stores, and h.h. gregg’s sales and profitability issues, industry execs across a wide spectrum see this more as a change in retailing rather than a widespread consolidation.
The merchandising power of Walmart and the continued dominance of Amazon.com, and growing appeal of online sales in general, remain a threat to regional retailers; the execs who spoke with TWICE said those retailers that recently have had problems are due to specific flawed business models or management teams.
This industry’s retail landscape always changes, but now it is doing so more rapidly than ever. But brick-and-mortar stores will not disappear anytime soon.
Industry specialists – who are all online by now – are adapting to emphasize the advantages of brick-and-mortar, namely popular product categories from top brands in stock, customer service and delivery, and redesigned stores that welcome consumers (a la the Apple Store strategy) where they can test and play with the merchandise in a modern, relaxed setting.
And to repeat what buying groups have been preaching to their members, just having a website doesn’t cut it. A full-blown social media strategy to engage with existing and new customers is now vital.
One of those retailers that sees the new trend is Video & Audio Center in the greater Los Angeles area. The now-four-location retailer they have certainly created a lot of buzz in the past year and half at least, completely embracing the Ultra HD TV, working with top brands to debut these upscale products, and generating strong sales.
Its latest move is to open a new location in L.A. (see exclusive TWICE report), previously a top Sony Store location. The store was completely redesigned with an open concept where customers can test products – not just Ultra HD TV, but an expanded selection of headphones and tablets, with unlocked smartphones, wearables and others to be added soon.
Corporate director Tom Campbell described change for industry retailers this way: “It is no longer about how many boxes you can possibly jam into a retail store. You have to sell the experience to consumers.”
With the economy expected to grow at a steady pace this year, and demand increasing, those who adapt will, as usual, reap the rewards.
This blog originally appeared as a column in the April 21, 2014 print issue of TWICE.
