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Tuesday, August 4, 2020

The new RadioShack: Broadway debut for concept store

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Robert Francis
Robert Francis
Robert is a Fort Worth native and longtime editor of the Fort Worth Business Press. He is a former president of the local Society of Professional Journalists and was a freelancer for a variety of newspapers, weeklies and magazines, including American Way, BrandWeek and InformatonWeek. A graduate of TCU, Robert has held a variety of writing and editing positions at publications such as the Grand Prairie Daily News and InfoWorld. He is also a musician and playwright.

Robert Francis rfrancis@bizpress.net

Get ready for a RadioShack store as new and innovative as the technology it sells. That’s the message of the Fort Worth-based retailer’s new “concept” store that was unveiled June 29 in Manhattan. How is the new store different? “When you walk by this RadioShack you see very clearly into the store and you see it’s interactive and fun,” said Mike DeFazio, senior vice president of store concepts. “The front of the store has an interactive toy table, an interactive headphone table and an interactive screen in the window that explains who we are and the products we carry.” Though it’s more a matter of timing than strategy, the first of several new concept stores is located in a high-profile, high foot-traffic area of Manhattan’s Upper West Side. The location is a cab ride away from Wall Street, which has kept a cautious eye on RadioShack’s turnaround plans since former Walgreen’s executive Joseph Magnacca took the reins as CEO of the struggling retailer in February. “Our goal at RadioShack is to make our iconic brand relevant to new segments of the consumer market, while reinforcing our commitment to the strong and loyal base of customers who have known RadioShack for many years,” Magnacca said in a news release. “We know that all of these consumers like technology when it makes their lives simpler, but they love technology when it make their lives fun.” Over the next several weeks, RadioShack plans to open a variety of store configuration prototypes in the New York metropolitan area as well as in New Jersey and Texas. The configurations will be customized based on locations, local buying patterns and neighborhood needs. The company will use information gleaned from the new concept stores for future retrofits and remodeling of many of RadioShack’s 4,300 stores in the U.S. A concept store in Fort Worth is planned, according to company officials. The design overhaul is a key component – and the public face – of Magnacca’s turnaround plan, which includes assembling a strong management team; merchandising strategy; improving the in-store experience; and changing public perceptions of the company. According to a note from Janney Capital Market analyst David Strasser, who visited the new location, the store goes a long way toward implementing changes throughout the RadioShack organization. “The need to be quicker to market with new products is apparent. This store will look silly without the hottest and newest products,” he said in the note. Strasser also said the new store will force RadioShack to focus on “service and knowledge” as a more critical component in a store’s success. “This store is not only a merchandising shift, it has to represent the best of the past, combined with defining the future,” Strasser’s note said. Strasser also called the new store “Applish,” which he said is a “compliment/complement in every sense of the word.” The store also displays a different mix of products than those emphasized in the past. Mobile and wireless products were the hallmark of the company for many years before that category became commoditized. DeFazio noted that much of what is seen in the new concept store was already being carried at RadioShack, but it went almost unnoticed. “You’re going to see a lot of what we carry inside that store, just displayed in a visual manner in an interactive approach that just brings things to the forefront that the consumer didn’t see inside our store before,” he said. These changes may bring RadioShack into the 21st century, as analyst Strasser noted, but any electronics bricks-and-mortar retailer in 2013 is going to face multiple challenges. While competitor Circuit City has bitten the dust, a struggling Best Buy offers larger showrooms and a flashier presence. Meanwhile, online retailers like Amazon.com are clicking away at margins. Those struggles have taken their toll on the company that was founded in 1921 to provide equipment for ham radio operators. It has been a staple of the Fort Worth business community since Charles Tandy purchased it in 1962. In the first quarter of 2013, shortly after Magnacca came on board, RadioShack reported total net sales and operating revenues of $849 million, compared with $913 million a year earlier. Comparable store sales were down 5.7 percent in the quarter. At the same time RadioShack opened the new store, it unveiled a new, revised, logo for the company. The changes in the logo and in the stores are not the last of the changes to be seen from the company, said DeFazio. “You’re going to see a very different RadioShack from a consumer standpoint with respect to interactivity, relevancy, ease of shopping and a clean and sophisticated approach to the business,” he said. The changes have been validated, DeFazio said, by customer comments such as, “it’s clean;” “it looked bigger;” “it’s easier to navigate;” and “it’s fun to be in here.”  

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