Is Best Buy the Next Circuit City, Will Internet e-tailers Demolish Modern Day Retailers?
Modern day retail shops and chain stores have continued to feel the impact from the success of Internet e-tailers. The latest in the growing list of impacted companies is Best Buy Inc.; who’s recent announcement of resignation of founder and chairman Richard Schulze, has sent a long list of questions and speculation into the corporation’s future.
Best Buy has been quick to create a positive information flow following the announcement. This has included upping shareholder dividends, announcing a more robust associate training program, and waging war on the act of “showrooming”, defined as the act of shoppers checking out products at the store but then buying them cheaper online.
These really speak to the threat that retailers have faced from e-tailers like amazon.com. Best Buy essentially being the last standing electronic retailer since the demise of Circuit City, has continued to see falling stock prices and announced the closure of 50 of its stores.
Some of the largest retailers in the U.S, namely Sears, and J.C Penny have also been hurt by Internet e-tailers. Both companies continue to try to reinvent themselves in every way possible. Sears just announced layaway plans for vacations, and J.C Penney is creating a boutique feel to stores. Both have modified pricing and gone through extensive remodels to woo back customers.
The changing retail marketplace speaks to a new consumer. With the convenience of anytime shopping, available reviews, doorstep delivery, better pricing, and tax savings; Internet e-tailers are poised to continue to lay the smack down on the traditional retailer. Best Buy Inc. Seems to be facing an uphill battle with a fate that is already well on its way to the inevitable. It will be interesting to see how long before consumers pull the plug on the life support.