Are high street electrical stores doomed to fail?
The electrical chain Best Buy is closing its UK stores. Home entertainment sales are slumping. Death is knocking on the door of physical formats. Are we seeing the death of high street entertainment and electrical retailers?
It was announced today that all 11 of Best Buy’s UK stores are to close. The chain, a partnership between Carphone Warehouse and US electronics giant Best Buy, launched in 2009.
Its doors are closing just 18 months later.
There are over 800 Best Buys in America, offering everything from TVs and computers to video games and Blu-rays. It hoped to compete, where others are failing, on UK high streets, but it’s lost money ever since it set foot on our shores.
It’s definitely a shame – Best Buy offered much-needed competition in a sector that’s dominated by Dixons Retail (PC World and Currys). But perhaps this is just a sign of things to come? Maybe PC World, Comet and HMV will soon follow?
Home entertainment has been hit hard by the recession, since we’re all cutting down on luxuries. In its Global Home Entertainment market report, Verdict Research found that consumers are spending 21% less on things like music, films and video games than in 2008.
Competing with online sales
The question is whether these are symptoms of a short-term illness or signs of something more serious? Personally, I think we’re seeing the start of an epidemic as electrical stores struggle to keep their sales healthy.
Why buy CDs on the high street when you can buy them cheaper online, or buy digital copies, or even better, stream music for free?
And as far as electronics go – stores like Currys have been feeding off the boom of people upgrading their CRT TVs to flat screen tellies. As this market declines, what have they got to hold on to? 3D TVs? I think not.
Personally, I buy all my electrical and entertainment goods online. It’s cheaper, delivery is usually free and you can get cashback with services like Quidco. In fact, I only recently spent money in an HMV store because my gift card wasn’t accepted on its website.
Bye, bye physical formats
Physical formats are also entering their last hurrah, with reports (albeit shaky) that music studios are planning to turn their backs on CDs and go download-only from next year. In our previous Conversation about the demise of CDs, commenter Smcrae argued that even if he was to buy CDs on the high street, he wouldn’t do so in a store like HMV:
‘When I buy, I do it from good record shops if I can – primarily to support them. The CDs are in the cases on display, and there are lots of players around so you can listen first. A great variety of music, quiet atmosphere, space. I will go out of my way to go there and find things to buy. HMV doesn’t generate the same loyalty – it’s “fast food” retail.’
Smcrae’s got to the heart of the problem. High street stores need to bring the pleasure and excitement back to shopping.
After recently holidaying in Brazil, I was impressed by the technology offered in entertainment stores. TV screens and listening stations were dotted around, but rather than being limited to the store’s music and film selections, barcode scanners would let you scan the boxes to preview any of the films or albums on their shelves.
Electrical and entertainment stores need to bring the advantages of shopping online to the high street if they want to survive. The question is whether they’ve got the guts to innovate, or whether they’ll simply jump ship like Best Buy?
Which of the following places do you buy electricals?
I buy electricals online (71%, 519 Votes)
I buy electricals in department stores (like John Lewis) (43%, 310 Votes)
I buy electricals in high street specialist stores (like Comet or PC World) (37%, 269 Votes)
I buy electricals in supermarkets (20%, 142 Votes)
I don't buy electricals (1%, 5 Votes)
Total Voters: 726
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