Circuit City has seen the future of CE retailing, and it may very well be found in its new store format, The City.
The concept stores embody "a portfolio of ideas" culled from two years' worth of "innovation work" in the company's Boston and Miami lab stores, said Steve Pappas, small-stores president and point person on the project. While still a work in progress, management had enough confidence in the format to open seven The City stores around the country following the first trial run in Norfolk, Va., in June, and the company is on track to have 20 sites up and running by the end of February.
What makes The City different? It's 20,000-square-foot size, for one. Tests showed that the smaller footprint is more productive than the chain's typical 33,000-square-foot box, Pappas said, thanks to shrinking product dimensions. The new stores are also merchandised more efficiently, with narrower but deeper assortments of best-selling, high-margin products. Modular fixtures allow The City stores to quickly alter the mix as demand changes, and greater integration with online inventory allows in-store customers to choose from 1 million SKUs and have their purchases delivered free of charge.
Other innovations include prepackaged product bundles, and high-tech tools like wireless tablet PCs, which sales associates or "partners" use to check inventory, schedule Firedog appointments and walk shoppers or "guests" through the sales encounter. The tablets' "guided selling application" helps identify products and services appropriate for each customer by drilling down through a hierarchy of circumstances, explained Brian Leach, The City's regional VP. This allows associates to cover multiple categories ("You'll never hear 'It's not my department,'" Leach said), while addressing the training issues associated with non-commissioned sales staffs.
How far will Circuit take the format? "It's very early on in the process, but we've had very positive feedback," Pappas said. The City "allows us to look at trade areas in a different way," giving the company greater flexibility to enter new markets and backfill existing ones. While Pappas was mum on the company's long-term plans, he said most Circuit City stores opening in 2009 will likely be in The City format.