One of my first retail consulting assignments was also one of the more fascinating ones: Should Radio Shack change its name? This was a long time ago, back in what would now be considered the heyday of the brand, but a compelling question nonetheless. Could there ever be a worse name? Radio, signifying antiquated technology, and a Shack, hardly the most inspirational environment to buy a product.
Our conclusion at the time (right or wrong) was to leave the name but change the meaning. Radio Shack had something like 97% brand awareness and some staggering number (perhaps two-thirds) of U.S. households who had shopped there. We looked hard at what was the essence of the brand, which ultimately became “You’ve Got Questions, We’ve Got Answers.”
So many customers would walk into the store and say, “How do I connect my TV to a VCR?” or, “How can I fix this?” The store sold useful stuff with knowledgeable associates who could answer these questions. We worked on revamping private label (again, the company was a pioneer) and modernizing the stores. It succeeded for a time while we also worked on some amazing (but ultimately unsuccessful) ways to extend the brand like an ambitious concept called Incredible Universe.
Radio Shack had a roller coaster of a ride, many times figuring out ways to extend the relevance of its store as new technologies that needed answers came around. They had the leading market share in mobile phones, as one example.
Ultimately, the question comes down to relevance. As markets change, competition changes, technologies change and the customer evolves, how do you keep your stores relevant to the customer? What are they looking for that you’re not offering? What are they turning to your competitors for? Are there new competitors that didn’t exist five years ago?
Earlier this year, we were asked the question, what should keep retailers up at night? My answer then was relevance. The saga of Radio Shack underscores that. This won’t be the last iconic retailer who shows up on a Chapter 11 list. The painful realities of modern retail make it clear that retailers need to evolve or face a painful end.
What should supermarkets be doing to stay relevant?