TigerDirect Follows RadioShack?
Just less than a decade ago, a visit to a CompUSA proved to be a real eye-opener. For a store selling cutting-edge consumer electronics, the store design seemed terribly outdated. The product clutter in some areas seemed reminiscent of bargain stores of decades past. During the visit, several shoppers commented that groups of floor personnel were seen chatting in circles. Said customers felt these employees seemed to resent being interrupted with a relevant question or request. In fact, the most knowledgeable and accessible employee on the floor was the B to B salesman who could easily list the geographical logistics and needs of his professional customers. People who sought to speak to a manager were encouraged to endure a seemingly endless wait.
In 2007, more than half of the chain was closed. In late 2007, the remaining 100+ locations were awaiting liquidation. A month later, as we entered 2008, Systemax Inc. announced its acquisition of the CompUSA brand, trademarks, e-commerce business. Systemax also decided to maintain a handful of CompUSA retail locations in Florida, Texas, and Puerto Rico, with expectations to expand the portfolio over time. Gradually this total eclipsed the 40 mark.
Well prior to the acquisition by Systemax, the CompUSA reality had outgrown the limited implications of its name. Just over a decade before the name had been launched to reflect the rapidly growing computer market for both home and businesses. For several years CompUSA was one of the few national outlets offering Apple product as Apple was fighting for its own survival, based on the perception of its superior personal platform. This was long before Apple’s world changing products and services came onto the scene. At this time Apple had dropped Best Buy due to BB’s poor performance of explaining the Apple difference to customers.
Within years of its inception, CompUSA began to offer a growing variety of non-computer-based CE products. The growing number and size of flat screen televisions began to call for significantly increasing amounts of floor space. Trending sales, based on demand, called for additional focus on emerging technologies including digital cameras, camcorders and cell phones. Revenues don’t lie and CompUSA was rapidly featuring much more technology than simply computers, software and accessories.
CompUSA’s new parent Systemax was a company originally based in computer technologies. They too saw the writing on the wall and continued to expand the diversity of CompUSA’s product assortment for their newly acquired stores. Approaching the summer of 2009, Systemax announced the acquisition of Circuit City’s intellectual property, including its internet domain. In late 2012, both CompUSA and Circuit City were consolidated into the company’s-TigerDirect domain.
At the time, a CSG Insight questioned the wisdom of dropping the CompUSA name from both the store fronts, as well as the website. True the stores and the website were focused of much more than computers. However the CompUSA brand had grown a cachet. Perhaps a minor tweak would have explained the vast number of additional product lines. At the time it seemed that the name TigerDirect had even less focus and far less cachet.
Now Systemax has decided to close all but three of its remaining 34 physical locations. Interestingly, one of the survivors is located in distant Puerto Rico.
This comes on the heels of RadioShack’s surviving bankruptcy and its purchase by a new owner which is negotiating for RadioShack’s intellectual properties, including the right to use the RadioShack name on its newly acquired stores.
For years there have been vociferous arguments as to the value of the RadioShack name as a brand. Here too the name no longer describes much of what can be found within the company’s stores. However years of branding these longstanding, ubiquitous stores has grown enormous cachet.
While many have criticized the antiquity of the name in the past, many more wonder what the new owner would do without the familiar RadioShack brand. Of course, just a few years ago the retailer embarked on its short-lived ‘The Shack’ campaign, which, at least for a while implied less than satisfaction with this brand.
Now Systemax has decided to essentially closedown TigerDirect brick and mortar operations. Though three stores remain alive, there is some hope for future openings. At the moment this would appear doubtful. The company’s attempt to revive the Circuit City brand, at least as a website, at most for the possibility of reopening the brick and mortar concept, simply fizzled after a few seasons.
How will TigerDirect do in the future? Based on the parent Systemax’s history with the CompUSA and Circuit City website lives, one cannot be very optimistic.
One of the criticisms of RadioShack was that the while the company experimented with various attempts at offering repair services, through the years, no national effort ever took hold. Here the feeling was that due to the ubiquitous presence of these locations, this would catch the imagination and confidence of consumers nationwide. Various attempts to offer a standard service never caught on chain-wide and in fact follow-up never lasted significant lengths of time, including regional attempts during the year prior to the recent bankruptcy.
The CompUSA locations which Systemax maintained, offered service counters for repairs. Unfortunately, with just over thirty stores at last count, these locations were far from ubiquitous. Now with the virtual demise of the chain, those customers who lived relatively near a store have lost a valuable repair facility. Repair services are one strong advantage brick and mortars enjoy over Internet-only dealers.
A friend, who builds computers as well as websites, has long been a fan of CompUSA/TigerDirect. He grew up near several CompUSA locations. When he moved far away, he relied on the TigerDirect website but would often await a visit to his family to revisit the stores. That can no longer happen.