Dive Brief:
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Circuit City will relaunch Feb. 15 "with a dynamic, social-focused e-commerce site, along with various concepts of innovative retail stores," the company announced at the 2018 Consumer Electronics Show in Las Vegas on Monday.
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The company also announced a partnership with IBM Watson commerce, which incorporates AI and other new retail technologies into its web platform, the company said in a press release. The website allows various ways to shop — via room layouts, category or brand, according to Dealerscope.
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The new Circuit City management shared plans for a concept store, designed with the Taylored Group, which will be spaces of about 10,000 square feet and feature demo areas and displays as well as community areas for hanging out, education and other activities, according to Dealerscope. Circuit City’s plans — neither timing nor place — for its brick-and-mortar rollout were not disclosed, according to the report.
Dive Insight:
It’s been almost two years since Circuit City CEO Ronny Shmoel, on the verge of opening a Circuit City location in Dallas, pulled the plug on the brand’s comeback, saying he "wanted to get it right." Shmoel acquired the brand in 2015 from Systemax, which had been running it as an online-only afterthought after acquiring it through a 2009 bankruptcy auction.
In the two years since that abrupt delay, Shmoel seems to have re-envisioned retail itself. The planned stores sound like a hybrid of Apple’s community-focused gathering places and Best Buy’s practical demo spaces. And the e-commerce site sounds like it may be capable of offering something that has mostly eluded online shopping — a delightful discovery-laden experience.
Shmoel's new Circuit City isn’t just going up against Apple and Best Buy, however — it’s also up against Amazon’s own strong electronics sales, which grew 4% year over year to an estimated $8.5 billion last year, according to marketplace analytics firm One Click Retail. The e-commerce giant’s electronics sales are being pushed in part by its surging voice shopping. Toward the end of the year, Amazon's voice assistant Alexa gained traction and helped move the needle on smart home goods too, according to One Click Retail. Alexa-enabled devices including Nest thermostats and video doorbells, and the TP-Link Smart Plug (the No.1 item in home improvement) helped drive 71% growth in Amazon's home automation sales, One Click Retail found, with leading brands like iRobot and Philips integrating Alexa compatibility into their latest models.
And there’s still Best Buy, which has been effectively executing a turnaround and which is widely seen as the bane of Circuit City’s existence in the 1990s and a major reason for its downfall.
For any retailer, it's a high-touch, low-margin business, Stephen Baker, vice president and technology analyst at global information company The NPD Group, told Retail Dive in an interview late last year. "If you go back a few years there were a lot more. Everybody runs into issues at times, but they’ve been good, big and important to the business," he said. "They think about it and think about ways to get support. If you look around, they are by far the largest consumer electronics retailer in the U.S., and it’s going to be a long time before anybody has enough juice, Amazon included, to catch up."