2014-02-25 20:43:03 - Electronics and Appliance Specialist Retailers in the US - a new market research report on companiesandmarkets.com
The United States electronics retailers market has been hit by intensified competition from online retailers and other non-specialty channels. Total store count declined by 2% in 2012 as major chains downsized and smaller retailers were squeezed out. Non-specialty stores, such as Wal-Mart, Target, or Costco, offer competitive pricing on similar if not identical electronics products in convenient one-stop-shop formats, while online retailers typically have price advantages and robust product comparison opportunities.
Consumers are focusing on smaller purchases of exciting new products, usually as gifts for others or rewards for themselves, and delaying purchases of non-essential replacement items, such as televisions and major appliances that show less noticeable innovation and differentiation between models. How well this tactic will work to sustain and
grow these businesses remains in question. In response, many electronics and appliance specialty retailers have moved more to selling popular and high-volume smartphones and mobile devices and offering more services instead of relying on former standbys, such as televisions and media products.
Although still the market leader at 33% of sales in the electronics and appliances specialty retailer category, Best Buy has been struggling to grow sales in the past few years as the consumer electronics industry evolves rapidly. The company restructured domestic operations in 2012, closing approximately 50 Best Buy stores in the US and shifting the fiscal calendar, along with other operating changes. Both in its big box stores and its newer fleet of smaller Best Buy Mobile stores, Best Buy has demonstrated a pivot in strategy towards mobile devices and service offerings, such as a revamped Geek Squad.
In August 2012, founder Richard Schulze announced his intentions to take the company private and return to the helm. Although Schulze has until the end of February to make a bid, doubts remain over whether he can successfully raise financing and whether the board of directors would be willing to sell the company when its shares remain at low levels.
- Retail sales at electronics and appliance specialist retailers are flat in 2012, at US$99 billion
- Channel migration to online sales is prevalent in 2012
- Best Buy retains the largest market share among electronics and appliance specialist retailers despite widespread fears of showrooming
- Constant value sales are expected to decline by a CAGR of 2% over the forecast period to reach US$91 billion by 2017
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