Circuit City: Retail Resurrection

When's the last time that Circuit City crossed your mind? It's probably been so long that you can't even remember the last time you thought about it. And yet, the name Circuit City is instantly familiar to you. That's called name recognition. And clearly, rather than starting from scratch to build name recognition, you'd prefer to start with something well known. That is why Circuit City is being resurrected.

Once upon a time, Circuit City was the #1 big-box consumer electronics company. But a changing marketplace and strategic missteps lead to its rapid decline, culminating in bankruptcy in 2008. An outfit called Systemax (which also owns TigerDirect) acquired the brand at auction and tried to run it as an online site, but that fizzled too. Now two entrepreneurs, Ronny Shmoel and Albert Liniado, have bought the brand, and are ready for Circuit City 3.0.

According to a report in Twice, their plan is ambitious, to say the least. Starting with a retail location, possibly in Dallas, in June, the duo hopes to roll out retail stores, a website, licensed kiosks, mobile shops, various franchises, and branded and private-label products. The bricks-and-mortar stores will focus on a "small-box" format in locations ranging from 2,000 to 4,000 square feet. As you might expect, Millennials will be targeted and the product mix will include smartphones, tablets, notebooks, wearables, network gear, gaming gear, headphones, drones, 3D printers, health products, and DIY bits and pieces.

They hope to have 50 to 100 corporate-owned stores in place by end of 2017, and add up to 200 franchised locations later. Other physical stores will include small 1,500 square foot locations branded as CC Mobile and kiosks and in-store displays branded as CC Express stores; up 10,000 of these are envisioned within five years. If all of this reminds you of another dearly-departed outfit, Radio Shack, you're right. Certainly the new Circuit City hopes to pick up some of that business.

Why does this matter? And why should you be pleased to hear it? Because any targeted retailing of audio/video gear, even lower-end gear, is good for the industry at large. The departure of stalwarts such as Radio Shack, Sixth Avenue Electronics, CompUSA, Sam Goody, and Tweeter all hastened the unplugging of consumers from traditional electronics (and conversely, the unplugging hastened the decline of the stores). A reborn Circuit City puts at least some gear back on the shelves.

Will Circuit City simply cannibalize audio/video sales from struggling Best Buy and HH Gregg, or will it enlarge the AV pie? Or will Circuit City just wind up selling phones and drones? Who knows. But any physical location that lets buyers scrutinize two different TVs or audition a pair of speakers is a good thing. It might even prosper. Miracles can happen. Hey, even Delorean is making a comeback.