11) Circuit City-"Short circuited!"

Introduction:

Circuit City was once?considered the?market leader in consumer electronics (“CE”). Founded in 1949,?the company has evolved into?one of the most?famous?CE brands. From 1988?to?1999, Circuit City expanded?into a?superstore?format,?occupying?incredible spaces?in New York?City?and other urban centers.?During?this?time,?Circuit City was?considered?a leader in customer service, requiring many of its?employees?to?undergo?factory training on?the?products sold in?its?stores. It?looked like?Circuit City had?no choice but?to go up.

By 2000, Circuit City?could no longer?compete with Best Buy and other brands.?The company exited?the?consumer electronics?business?(even though he was?the second largest?consumer electronics?retailer in the?United States), remodeled?stores?and focused?on?PC?and entertainment products,?eliminated employee-to-employee commissions,?and?implemented uniform I?switched to?an hourly wage system. Despite?the turmoil, Circuit City made?several?acquisitions and partnerships?in his mid-to-late?2000s. It?looked like?things could?change?in the right direction. Instead,?on November 10, 2008,?the company filed for bankruptcy?protection.?Circuit City was?completed?in?March 2009. But between?April?2009?and January 2016, Circuit City experienced a?renaissance. Brands were?acquired and?reactivated during this time. On?August 22, 2018, Circuit City officially?rebooted. As?of?late 2019/early?2020, Circuit City has yet to show signs of life. Few companies get a second?chance,?and Circuit City?shows once?again why?companies?that?don't?adapt fail again.

Challenges:

In an industry with?very?high?overhead?and?low error rates, the?performance and availability of the?most competitively priced?data network is absolutely?critical.?As a?result,?Circuit City required maximum availability and?resilience in many locations. In terms of QoS, we also wanted?maximum?application?performance regardless of background traffic.

Circuit City wanted to?regain?control of?its?network and?consolidate?it?into?a single provider.?When the goal was?maximum network?coverage with?a single?provider, it was a daunting prospect. Added to this?was the need to?maximize?efficiency and?avoid?unnecessary?costs,?and the?requirements?were?high. A further requirement was?the centralization of?specialized applications and?the integration of remote users into the network.

Conclusion:

Many people?mistakenly?believe?that?digital transformation is simply?using?the latest technology. Circuit City may or may not?implement?the latest?technology.?If?so, on top of?all the other?points of failure, you're not using?the new technology properly. If?not,?the error?hinted at?the?losses?Circuit City faced?again?in?his 2008?and today.?Achieving true digital transformation requires considering?the tools available in the ever-changing marketplace and?understanding when and?how to use them. At?least?Circuit City failed to adapt in the areas of customer service, leadership, and strategy. These?points of?failure are obvious.?However, in?each of these areas, the?once-great machine runs more flaws every day.?Technology, strategy, leadership, decision-making, operations,?human resource decision-making,?customer?service, and more?– all of these areas?should?be considered by?organizations looking?to?move?from analog to?“digital”?thinking.

Learning:

The purpose of this case is to identify various areas of strategic marketing planning and decision making, including: 1. Identifying appropriate product differentiation strategies 2. Understanding the importance of building a distinctive competence 3. Understanding the importance of monitoring the competitive landscape 4. Understanding the importance of implementing: a. Creative growth strategies b. Short-term and long-term objectives 5. Being able to perform a SWOT analysis 6. Defining a clear positioning statement 7. Understanding the role and impact of management 8. Explaining the importance of employee engagement, satisfaction, and retention.

References:

• DTC downfall of circuit city
• The rise and fall of circuit city by abbri
• Case study Circuit city stores.