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News on the CE Retailing Front

by Team Sony 11/04/2008

This week’s news about Circuit City’s plans to close about 20 percent or 155 of its U.S. stores in 12 cities, coupled with last week’s report that the Tweeter chain has been sold to a liquidator, offer an indication of what the consumer electronics industry is up against going into the important Holiday buying and gift-giving season. 

That said, in a New York Times article on Monday, Stan Glasgow, the president and chief operating officer of Sony Electronics, was quoted saying, "In past recessions, consumer electronics has fared rather well.  I believe we’ll sell more TVs than last year."

And the Consumer Electronics Association is still forecasting respectable fourth quarter business growth for the category overall of 3.5 percent over the same period a year ago.

The question remains, however, will the consumers come out in force?  Despite the difficult economic picture, there are still gifts to be given and received. There are still exciting new products being introduced.  There is still the Super Bowl following the holidays.  And there is still the opportunity for consumers to upgrade their television viewing experience to HD with the digital transition coming up in February.

In fact, a GfK Roper Report published just last month, titled "Silver Lining: Insights and Opportunities in the Current Economic Downturn," found that 50 percent of online Americans plan to buy and an HD or flat-panel television television within the next year (57% men, 44% women), with little difference expressed in this regard between those who are generally planning to reduce their overall spending and those who are not.

So if consumers come around, surely there will be retailers to pick up the slack, whether it is the nation’s largest CE retailer Best Buy, increasingly influential mass merchandisers like Wal-mart and Target, or the club stores like Costco and Sam’s.  There are also the entrepreneurial independents and the growing wave of e-commerce merchants, not to mention in the case of Sony (and a few other vendors) our direct channel encompassing sonystyle.com and Sony Style stores around the country.

But even with all these options, I believe it’s important for Circuit City under its new management to continue its efforts to remain a premiere player on the CE retail scene.  From both an industry and a consumer perspective, it’s beneficial to have a strong No. 2 specialty AV retailer serving the U.S. market. Hopefully, with this week’s action behind it, Circuit’s management can now focus on enhancing its operations, providing an improved customer experience, and offering more consumer choices in the marketplace.

 

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  1. guest_user wrote: November 5, 2008 10:14am

    I think that electronic purchasing this year will be very intriguing but may be a
    little soft. The way that people may realize that they will have to be a cash only
    society may be present this spending season. Hopefully, people will find ways
    to get the purchases that they want and realize that Sony is the brand of
    choice! Blu-Ray players are a great item to choose from. I think that people will
    buy it in a great demeanor but the sales of it may see bigger demand next year
    after some how DVD releases from this year and next summer have arrived.
    I’m proud of Sony with their commitment and quality!! I also wish the best for
    Circuit City. They are a solid retailer but Mr. Clancy was right with his
    expectations on what they should do to regroup with management despite the
    dismal economy. CONGRATULATIONS TO BARACK OBAMA MAKING
    HISTORY!!! I wonder he owns a Sony?!?!

    Reply

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