Only a week after the Associated Press reported that there may be some hope for embattled electronics retailer Circuit City, the store has announced that they are closing up shop forever. This means that 34,000 more jobs will be lost, and the nation will have one less electronics superstore to comparison shop at.
The economic news has not been good on many fronts, and consumers are feeling the pinch in all directions. For the satellite radio consumer, it means one less outlet where customers can buy satellite radio gear. For Sirius XM there is a possible bright side. With Circuit City gone, the company will not be spending money on shelf space, ads in Circuit City flyers, nor will they need to send sales staff to the over 500 Circuit City stores any longer.
The company should think twice before thinning out the sales staff though. In many ways, the average big box retailer employee does not understand satellite radio well enough to even begin to speak about it with any real authority. From mispronouncing the brand, not comprehending the merger, and not even knowing that the music is the commercial free aspect of the service, many problems exist. The company should consider bolstering the sales force in remaining retailers, from those that once serviced Circuit City, to better educate those that sell to consumers.
Knowledgeable retailers such as TSSRadio may well benefit the most. Small independent companies that have a passion for the service offer consumers far more than the Circuit City's or Best Buy's of the world could ever hope to accomplish.
Yes, the closure of Circuit City means less exposure for satellite radio, but did the benefits in the existence of Circuit City outweigh the costs associated with servicing those stores? Two years ago, when retail meant more to SDARS, the impact would have been measurable as a negative. Today, with weak retail anyway, I am not so sure that would be the case. Certainly the print ad budget and shelf space payments dedicated to Circuit City will go away. The question is how everything will impact the bottom line.
Position - Long Sirius XM, No Position Circuit City or Best Buy, TSS Radio is a site sponsor of SiriusBuzz