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Electronics Retailers Scramble to Adapt toChanging Market
John Gress for The New York Times
An aquarium is one attraction at Abt Electronics in Glenview, Ill., where TimBurke, left, helped Brandon Saposnik.
BySTEPHANIE CLIFFORDPublished: June 18, 2012
Even asBest Buyinsists it can get out of its currentpredicament, competitors are circling, as everyone tries toprove one point: that electronics stores can thrive.Best Buy is closing 50 of its big-boxstores, and its sales at stores open atleast a year are falling. Brian J. Dunn,its chief executive, recently resigned afterthe boardfoundhe was having an inappropriate relationshipwith a subordinate. Richard Schulze, who founded
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John Gress for The New YorkTimes
Susan Schroeder, right,showing a massagechair to Nancy Monroe, ashopper at AbtElectronics.
the company in 1966,said this monththat he wouldleave the board immediately, a year ahead of schedule, and is trying to sell his 20.1 percent stakein the company.Now, Walmart is running ads going after Best Buyconsumers; a Chicago-area competitor is expandingamusement park attractions in its store to lureshoppers; and Target is selling Apple products — allin an effort to make buying electronics in a storeappealing again. The trends are not favorable.People are increasingly buying electronics online,even if they go to stores to examine productfeatures. The price of televisions is sliding, and CDsand DVDs are not nearly as popular as they oncewere. Retailers are stuck with lots of space asproducts shrink or go digital. And because manymanufacturers are not allowing retailers to advertisebelow minimum prices for their products, stores cannot publicize saleprices the way they once did.Sales at physical electronics stores have declined an average of 2.6percent a year in the last five years, according to the market research firmIbisWorld. Sales of electronics online have risen an average of 14.7percent a year in that period. Chains like Circuit City and CompUSA havecollapsed under the pressure. (CompUSA has been revived in somelocations.)
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So the stores that hope to survive must change.Take Abt Electronics, which has a 350,000-square-foot store in Glenview,Ill., a Chicago suburb. “People think that’s crazy these days,” said JonAbt, co-president of the store, but “if you’re going to have a showroom,you need to make sure you’re having a unique experience.”“We’re seeing more people shopping on their phone and on theircomputers, but that doesn’t mean store retail’s necessarily dying,” he said.Because shoppers often have their children with them on weekends, Abthas installed lots of activity stations for children and adults.At one machine, children can pull a cord and surround themselves in agiant bubble. Other attractions include a flight simulator, video games anda 5,000-pound granite ball that floats on water that children are allowed topush around.A 150-inch screen simulates colorful butterflies landing on viewers’shoulders, and an aquarium filled with exotic fish and even a leopardshark distracts children and serves as a subject for customers shooting testfootage with Abt’s video cameras. On weekends, employees servefresh-baked cookies and coffee to shoppers.“You’ll always see the construction sign somewhere in the building,” Mr.Abt said. “People get excited when they come in and see something newand different.”Abt also emphasizes customer service. It trains employees for two to four
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