retail news in context, analysis with attitude

Even as Blockbuster Inc. tries to expand into a new segment of the retailing business through a proposed acquisition of Circuit City, the Dallas Morning News reports that a number of stores in that market are testing several new concepts, including:

• "Whether customers want to rent movies as early as 6 a.m. on their way to work, instead of after work."
• "Including the option to buy a cappuccino or a fountain drink." (One concept being tested is an old-fashioned soda counter branded as the Coca-Cola Café.)
• "Offering new technology for watching movies, reading books or shooting video at a Blockbuster."
• "Whether customers would stop in more often if they or their children were entertained with a game of Rock Band on a 62-inch screen or they had access to free Wi-Fi."

The goal, according to CEO Jim Keyes, is to find new ways to keep the company and its fleet relevant to a fast-changing shopper base. "I'm a big believer of the physical relevance of a store. People like to shop, whether it's in a Neiman Marcus or a Blockbuster," Keyes tells the paper. "But we need to change our stores to become a destination for entertainment."

And, since the concepts are being tested in areas with varying demographics, the company is using different graphic and design approaches to see what works for different groups.

KC's View:
Longtime readers of MNB will know that I am no fan of Blockbuster, but I have to say that I admire the approach being taken here. Keyes is right – a store is only effective as long as it is relevant, and especially in this segment of the retailing business, relevance ebbs and flows with the changing interests and demands of a young and fickle generation.

I'm not sure how many big screen TVs Blockbuster can expect to sell in one of these stores, but there is no reason it cannot use a section of the store to highlight Circuit City special offerings if indeed that acquisition is completed.

There is no way to know whether any or all of these kinds of moves will work, of course. But it is better to try than to simply sit still and wait for the creeping irrelevance (not to mention the guy down the street) to put you out of business.