TWICE:What are the biggest challenges facing you and the industry?
LINTON: Best Buy has a mission and a vision and that’s that we make technology and entertainment products affordable and easy to use. The biggest challenge for us, as we are at the beginning of this digital evolution, is that it’s more complicated and harder to deliver on that mission. That requires a lot of evolution for us in terms of how we connect things that we are working on and how we connect with the suppliers. You’ll see us spending a whole bunch of time trying to do that right so that we continue to deliver on that mission.
TWICE:Does that mission include appliances?LINTON: Yeah, absolutely.
EDMONDSON: RadioShack’s challenge remains the same this year as it does every year, which really is to stay focused on our long-term strategic plan. Success sort of breeds more opportunities, and if you’re not careful, you can become overcome with opportunity. It’s very important we stay focused on what we want to be, how we want to get there, and to build the pieces a block at a time.
As Len [Roberts, RadioShack’s chairman] likes to say, you can have all the hopes and dreams and visions in the world, but if you don’t get results along the way, you’ll never get there. So we need to stay focused on what we want to accomplish, be results-driven, and not sacrifice today’s results for what we think is a very carefully laid-out plan.
Keeping a sustained focus over many years is probably the most difficult business challenge that any of us have.
MILLER: Our biggest challenge at Tweeter is people, attracting, developing, keeping high-quality people. Not just salespeople, but management, install and service, other support techs. To be true to what we are, we are absolutely people-intensive, and without very high-quality people and constantly moving them forward, we can’t be successful. So that’s the major challenge facing us.
TWICE:How do you do that?
MILLER: We try to find people who have the right mind set, the right personality psychically, I guess, and then we invest enormous amounts of money and time in developing them. People don’t walk on the floor until they’ve been trained for five solid weeks, for example. That’s a commitment that very few people in our industry have. But that’s our differentiator, so we have to do that.
I would suggest that the biggest challenge facing the industry, at least from our viewpoint, is distribution integrity, distribution discipline, not just of brands but also of technologies.
WORKMAN: The challenges facing Ultimate Electronics are twofold. One is realizing we can’t be everything to everyone. But at the same time, you can become cemented in a position. You have to be able to look inside your business and break those things that aren’t broken yet and find those strategic areas where you need to evolve.
The pace of change is something we’ve never been in control of, but you have to stay out in front of that and continue to clearly franchise your consumer and sell that message. So while there’s a whole host of technologies available, not all of those technologies are products that Ultimate should probably embrace.
WELLER: Good Guys’ challenge is to continue to differentiate ourselves through the products that we sell and through our assisted selling floor. I believe that’s our future. I believe sincerely that we’re gonna get supported by our vendors to do that. Time will tell.
MANN: The biggest difficulty MARTA faces is not so much the business or trends of the marketplace. Our guys are successful. They’ve been around for decades, some of them for a century.
The biggest problem is how we stay focused, how we all get on the same page together. That is a group’s problem in general.
Externally, we look less toward economic trends and consumers and much more toward the vendors. We needed to invent a community that’s interested in maintaining their brand strength, having equity in the brand whose long-term strategy stretches beyond making sure they had a big month this month and thinks about the impact of the actions they take in the marketplace.
PAYNE: For Amazon, we need to focus on maintaining our growth. Growing 200 percent year-over-year has been awesome, and we will endeavor to do well this year, but that will be a challenge for us. We’ll have to do a lot of hard work to make that happen.
Manufacturer authorizations also continue to be an issue for my company. We’ve had a lot of success-we have over 200 direct relationships and a number of breakthroughs in 2000-but Sony and Panasonic are still not in direct relationship with us.
We’re very hopeful that just as the folks at this table are embracing multiple channels, the key manufacturers will also fully embrace e-commerce because consumers are clearly voting with their feet and their fingers. They want to buy these products through multiple channels. We have great partnerships today, and we hope those expand.
HIRSHBERG: A key is to cut through some of the confusion, to get the industry to the next level where DTV and DVD recorders and convergence or connectivity can really drive the business forward. It’s a matter of clarifying, setting the standards, presenting a clear benefit message to the consumer.
You could say in audio the digital revolution happened in about 1983 with the CD. But here we are in 2001 with all of these potential new technologies that can drive sales. It’s a matter of which is the right way to go, and of bringing it to market.
TWICE:You have the final word, Frank.
SADOWSKI: Our biggest challenge is very simple, and that’s to be a profitable company. That’s everybody’s challenge in this business’ cause it’s not an automatic to say the least. Our challenge along those lines is particularly unique being an Internet company because by law we’re not permitted to be profitable. [laughter] We plan to change that, and we have a big challenge in trying to change the perception that Internet companies don’t care about profitability.
Our founder, Greg Drew, built the company on the premise of profitability, and I joined two years ago because we had a path to profitability since day one. It’s not something we just discovered was a necessity in the market conditions of this past spring. And we plan to get there sooner rather than later.
As for the industry, a lot of what’s been said here today points to an industry that’s kind of entering its adulthood. We’ve talked about the customer, and the customer in this industry has really matured. They’re starting to demand that they set the agenda, not the retailer. We can also give the vendors some fairly substantial credit, because they’re maturing too.
The likelihood of all of the suppliers selling everything to everybody is very, very unlikely, less likely than it’s ever been. I think they recognize the value of a channel like the Good Guys, or of Ultimate or of Tweeter just as much as they recognize the value of a channel like Best Buy. That’s really evolved and matured over the last five or six years.
And the retailers have matured. Look how retail has diversified. I mean 10 years ago everybody said this is going to be a homogenous marketplace with three or four huge guys. But it hasn’t happened. Even the tiny guys who have gone into custom installation and everything, the smart ones are thriving. They’re more than surviving.
I also think that industry, for the first time that I can remember, is actually cross-pollinating with other industries. Consumer electronics has been a really closed shop for a long time, and I see marketing people from other industries coming into the retailers. I see the manufacturers opening up and cross-pollinating with their different divisions and their different product groups.
That more than anything else will get this industry digitalized and through any recessionary times that may pop up. I think we have a really great future as an industry.