Sad but predictable: The demise of HMV
Tight aisles. Stacks of DVDs and CDs. Permanent discounts. When I think of HMV, this is what comes to mind. It is a retail experience I dread as an adult. As a teenage I loved it though, we would go in between lectures and browse the newly released singles that we’d heard on Radio 1.
Sadly the world moved on. Supermarkets begain stocking the latest releases and were able to undercut on price. iPods and iTunes made ot easier to access and purchase music track by track. Spotify (Music as a Service) provided free access to nearly every track ever recorded. Just as the traditional music store was on the ropes, the death blow came with Video as a Service (Lovefilm, Netflix, iTunes and so on).
HMV and music stores in general became irrelevant.
Whilst more could have been done with multichannel or digital. The essential and missing part of the marketing mix was relevance. Why would a customer buy from HMV? Would you make them look cool like Apple? Would you make it super easy to buy like Amazon? Would you make it cheaper than anywhere else like a pound store? Would you make it experiential like Disney? Or would you offer an exclusive product that could not be obtained anywhere else?
Unfortunately for HMV they can’t compete on price effectively against the global buying power of Apple or Amazon. Also HMV’s cost base of big stores in prime retail space wouldn’t compete against purely online retailers. Transacting in a retail environment is never going to be as simple as an online transaction where the product is shipped digitally directly into my phone’s music or video library.
This leaves two routes, exclusive products and experience. Perhaps HMV should have got behind indie music in the UK – becoming a record label. A CD Baby of the high street. Experiences could have been created by bringing live music into store. Alternatively experiences could have been created by helping customers find new music with in-store experts, DJs and a social network.
Consider it my opinion, but for retailers to survive they need to understand why they’re relevant and then innovate to get there. It’s risky but not as risky as doing nothing.
- Why We Buy: The Science of Shopping
- Smart Retail: Practical Winning Ideas and Strategies from the Most Successful Retailers in the World
- Brand Relevance: Making Competitors Irrelevant