Circuit City Tests Smaller Stores
By Tom Ryan
Circuit City is testing a compact, interactive format, called The City, as a key part of its turnaround plan. The stores measure 20,000 square feet compared with up to 33,000 square feet for a regular Circuit City and focus on blockbuster sellers in electronics categories.
The stores are being staffed with younger workers (80 percent between the ages of 18 to 25) equipped with headsets and carrying computer tablets to look up stats on any product in the company. Computers, cameras and video games are all hooked up and ready for hands-on testing with plentiful inviting stools to encourage customers to sit down and interact. Shelves rest on wheels so that product assortments can be re-arranged easily.
The staff recites such mottoes as “Keep it real” and holds twice-daily rituals of “shameless self-recognition.”
According to The Washington Post, The City is “a window into the kind of company Circuit City hopes to become, as innovative as the genius bar at Apple stores and as convenient as a drive-through pharmacy.”
In an interview with the Wall Street Journal, Circuit City CEO Philip J. Schoonover said that the concept stores give customers the convenience of shopping online and picking products up, as well as the option to try things out in the store.
“It offers a different experience. Customers can touch and compare, and learn how to use the most complex products and services that we sell,” Mr. Schoonover said. “It is a more efficient use of space… We can get higher revenue per square foot, higher-margin dollars per square foot, and we can find additional sites that weren’t necessarily available for our old box.”
So far, Circuit City has 16 of the newer stores up and running, and plans to open 50 to 60 in the fiscal year that begins next month. The best ideas from ‘The City’ will be rolled back into the core Circuit City stores.
Circuit City says early sales and customer feedback have been positive. Circuit City has posted losses for the past year as store-level changes disrupted operations and competition intensified with rival Best Buy.
Discussion question: What do you think of the possibility of a smaller, more interactive format in the consumer electronics space? What would the keys to success be for a winning concept?
- Can Circuit City Survive Boss’s Cure – The Wall Street Journal
- Circuit City aiming small in latest turnaround effort – Chicago Tribune