“The Shack” Finds a Way to Stay Relevant
After 88 years Radio Shack is losing the *Radio*. Most of the blogs covering the rebranding have decried it (see TechCrunch’s piece titled “Why? Why!?”). I am somewhat agnostic as to the change, though I think its funny they are taking a page from Yum Brands’ Pizza Hut strategy (now just “The Hut”). Name changes are tough to pull off since you risk losing some brand awareness, but I believe The Shack has the potential to not only survive, but thrive. Fred Wilson posted today about how surprised he was to see a bunch of people using pay phones at the airport. The take away is the fact that most technologies live on well after TechCrunch has labeled them has-beens (you may recall FourSquare was the “Twitter Killer” at this year’s SXSW - Twitter has 50 million users, how many does FourSquare have??). Fred noted that technologies take a long time to die unless they are rendered completely useless like analog TVs. Guess who made a killing on the death of analog TVs? Radio Shack pulled in $70 million in Q1 and $50 million in Q2 in digital converter box sales. Not bad.
Harry at Technologizer somehow got the following placed prominently in the TC article: “Its stores are tiny by the standards of the past few decades of American retailing, and therefore can’t compete with the product selection at rivals. (The TV section at my nearest Costco is larger than my local RadioShack.)” Even though Idiocracy predicts the future of retailing is Costco, I don’t. You can get most items shipped. Its the convenience items that people will go to retailers for. Things like converter boxes (nobody is going to go a day without TV), cell phones (when you lose one, you need a new one) and the connectors and gadgets they are famous for (leaving on a trip to Asia tomorrow?). The Shack needs to bridge the gap between old and new technology, stay with their small store concept and carry electronic necessities. That’s a recipe for success even Lance Armstrong can get behind.
