The 80’s called… they’re reminding you how to succeed. I have seldom seen a company consistently make the same mistake over and over as much as RadioShack (except maybe Sony, but we won’t go into that now). As one of the loyal customers they originally built their empire upon, I can tell you that the world still needs, and WANTS, a RadioShack. Just not the one we have today.
Revenge of the Nerds: RadioShack’s Original Success
Today’s RadioShack stores are so useless and irrelevant to modern consumers, most of us aren’t surprised they recently filed for bankruptcy. In fact, most of us are surprised it didn’t happen sooner. The store has fallen so far it is hard to remember what made it successful in the first place. The answer? Nerds.
Way back when RadioShack started in 1921, there was a revolution in modern technology going on: the radio - hence “Radio” Shack. Unlike today, the radio was an expensive serious piece of equipment which needed repair. The first common household “IT” support was for radios. Even continuing into the 70s and 80s, most technology was only accessible to a certain segment of society.
Computers, CB radios, remote control cars, walkie-talkies, and even calculators were far from “consumer friendly.” But while the rest of the world was still waiting for the iPhone, geeks and nerds, such as myself, found a haven in this wonderfully compact store called RadioShack. I remember, when I was just ten years old, building a doorbell and alarm for my bedroom to keep my little brother out from parts and pieces at the odd little store.
Chasing the Mainstream: How RadioShack Lost Its Soul… and Its Customers
As time moved on, technology became more accessible. First it was cool telephones, then personal PCs, then PDAs, and then smartphones, etc. The real tipping-point was the iPod. As technology became more mainstream (that means appealing to teenagers) RadioShack saw their geeky products get ignored while stores like BestBuy were making money selling only “out of the box” consumer electronics.
In RadioShack's push to stay alive, they never stopped to consider where their original market may have gone. Instead, they played-to-their-weakness and tried to compete with stores 10x their size in hopes of getting some of that great impulse-purchase economy. In this move, RadioShack has continually been on a downward spiral to this day. So what can they do to fix it?
RadioShack Still Has Customers… If They Pay Attention
I don’t shop at RadioShack anymore, but I do shop at NewEgg, B&H Photo Video, and ThinkGeek.com. Why? Because they are still selling to me. Yeah, they still have those zombie-phone products as well, but they carry the stuff I want in the dark recesses of their product catalogues. The reality is that RadioShack tapped into a cultural phenomenon, and while that phenomenon has nothing to do with Radios, there is still a phenomenon going on right now. It’s just a lot cooler…
Micro-Computers, Robotics, Sensors, and Garage Laboratories
There is a whole world of cheap sensors, small computers, robotics, and biotech coming into the semi-consumer market. In the same way that radios where the “thing” to geek out on, now us geeks are doing thing like running DNA tests in our home laboratories. We are using small computers like Raspberry Pi to create all sorts of intelligent “things.” (Check out this $500 home lab shopping list:http://www.mlo-online.com/articles/201112/the-quest-for-the-500-home-molecular-biology-laboratory.php)
Road to Success:
Here is how I would direct RadioShack if they cared to ask me.
Step 1: Identify which stores sell the most “geek stuff.” Not which stores necessarily sell the most, but which stores are attracting the "nerdiest" market.
Step 2: Cross-reference that data with demographic research to match with areas of high entrepreneurship, tech college students, and millennial populations.
Step 3: Close other stores and focus on serving those targeted communities with starter-kits, and a combination of high-end purchases with small-end refillable parts.
Step 4: Open up stores on Friday and Saturday nights to local meet-ups and enthusiast communities.
Step 5: Listen to your customers and stock accordingly.
Step 6: Don’t make the same mistake again in ten years.