Do Electronics Stores Have A Future?
Do Electronics Stores Have A Future?, Once dominant, Best Buy, GameStop, and RadioShack are now all just fighting to stay alive. Can Electronics Stores Survive?, Is there a future for electronics specialty stores?
Not long ago, retailers such as Best Buy Co. (BBY), GameStop Corp. (GME) and RadioShack Corp. (RSH) were outmuscling competitors across America by offering one-stop shopping for the latest televisions, computers, videogames and gadgets.
Now all three are fighting to survive. The rise of online competitors like Amazon.com Inc. (AMZN) that offer low prices and downloadable products have siphoned customers and sales from these once-powerful retailers.
The retail chains are responding with turnaround strategies that highlight their abilities to obtain hot new smartphones and tablets, and are trying to capture those purchases that consumers still prefer to make in person.
But they concede they have to evolve fast. “There is a future for consumer electronics in retail,” insists GameStop’s chief executive, Paul Raines. “But in order to survive, our internal rate of change has to be greater than the external rate of change.”
His GameStop, which has 6,600 U.S. stores, is adding used iPhones and tablets to its portfolio of new and used videogames. It is also beefing up its digital download services to compete against game websites like Valve Corp.’s popular site, Steam.
RadioShack, whose stock is down 75% this year, is playing down cables and connectors and refashioning itself as a convenience store for smartphone buyers. And Best Buy is shrinking its fleet of big-box stores, pushing high-end appliances and retraining workers to focus on tech support. It also is opening hundreds of small stores devoted to mobile phones and tablets.
“We’re balancing secular decline in the industry with capturing growth in the areas that are exploding,” said Mike Vitelli, president of Best Buy’s U.S. operations.