Survival Of The Fattest - Twice

Survival Of The Fattest

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As is the norm, nothing stays the same in CE retailing. It’s been a crazy summer and the last two weeks saw a flurry of activity by some of the largest players in the game.

For starters, Best Buy has upped its landlord status, inking two major deals to lease space in its stores. Both AT&T and Verizon will roll out stores-within-a-store to offer specialized sales and service for their competing smartphones, and, more importantly, the ecosystem of products that connect to those devices.

It’s a good strategy, I think, as Best Buy often attracts a different kind of customer than the ones who only visit a carrier store once every two years to upgrade their phone. Specially trained Best Buy Blue Shirts will have ample opportunity to explain and even demonstrate how the smartphone can now be the hub of one’s connected lifestyle and smart home.

In addition to strengthening its position with the country’s two major cellular carriers, Best Buy also inked a deal with the country’s largest department store chain, Macy’s, to open its own store-within-a-store department inside select Macy’s locations.

It’s a win-win as Best Buy gets exposure to a tonier crowd while Macy’s gets to re-enter the CE world without having to deal with the logistical problems.

An overview of Best Buy’s strategies and a peek at the evolution of the chain’s big-box stores.

While all that was going on, Amazon, who is still one of the largest retailers in the world, put on its vendor hat yet again and this time took aim at disrupting both the tablet and streaming entertainment markets.

With its sights squarely on the lucrative holiday season, Amazon chopped their entry-level Fire Tablet price in half, to $49.99 for a 7-inch model, and an unheard-of “buy five get one free” deal — yes, they are calling it a six-pack — for $249.

In addition, Amazon added 4K streaming to its Fire TV set-top boxes, trumping Apple’s recent introduction of its new Apple TV product, which inexplicably is not 4K-enabled.

Amazon will not rest until it buries the competition.

The details of these and other new Amazon TV products and tablets.

Of course, every story needs a true villain and no retailer plays the part more than good ol’ Walmart. The world’s largest retailer decided that it hasn’t squeezed its vendor partners quite hard enough yet so it rolled out a new Draconian set of vendor terms regarding stocking and warehousing vendors’ inventories. The goal, Walmart said, is to improve efficiency, strengthen ties with vendors and deliver even lower prices to its customers. The reality, according to some vendors, will be laid off workers and lower wages as vendors are forced to absorb new costs passed along by a company that rung up $130 billion dollars of profit in the last year. (You’d think someone in the Walton family could just sell a painting or something.)

What all this pivoting and deal-making adds up to is a snapshot in time of a brutal business atmosphere, where competitiveness is not a strategy, but a Darwinistic necessity. Eat or be eaten is the name of the game.

As I watched Donald Trump and Carly Fiorina argue about who is the worst CEO in last week’s Republican primary debate, I realized something that I guess I already knew: I’d make a lousy CEO.

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