Cir cuit city

rewires
Presented by-
Debi
Pooja
silpa
Intro…

• Established in the year 1970’s in the

name of “WARDS”
• Named “CIRCUIT CITY” in 1980.
• Present CIO- MICHEAL JONES
• Electronics retailer offering:
– Consumer Electronics
– T.Vs and Stereos
– CD and DVD
– Others (Banking & Used Car
Intro

• 1980: Circuit City was the leading

 retailer in the US consumer
electronics market.
• Generated cumulative stock returns 22
times better than the market beating
Intel, Wal-Mart, GE, Hewlett-Packard
and Coca-Cola.
• By mid 1990s it had lost its market
position
Cont…

• Consultancy Retail Forward ranked it as

the number-three seller of consumer
electronics, behind Best Buy and Wal-
Mart.
• To regain its position the company
started its turnaround Strategy that
included upgrading merchandising,
improving its advertising and
promotion, organizing training and
Cont…

• Top executives announced plans to turn

the company into a customer-focused
business that delivers a personalized
experience to all its customers across
all channels (stores, Web and call
centers).
• It upgrades its mostly proprietary point-
of-sale (POS) system and builds an
enterprise data warehouse to replace
 From Cash Registers to
Crash Registers-:

• Circuit City believed in building its own

systems as it felt no one knew its business
better than its employees which will give
the company a competitive advantage.
• The POS system supported the company’s
commission-based compensation structure
by keeping track of its associates and
their sales .
• Internet provided detailed information about
its product which allowed consumers to
select more merchandise on their own .
Cont..

• Associates used the POS system to lock down

inventory for customers who were
interested in buying particular products.
• It enabled them to access inventories of
other local stores to see if products were
stock out in one store might be available in
another.
• It was the 1st retailer to allow consumers to
check , purchase or pick inventories online.
• POS system got old, complex and
Location-:

• The company chose second tier

locations for its superstores while
expanding to save on rent.
• 1990:Best Buy during expansion
snatched property in busy shopping
centers.
• 2000: Circuit City remodeled its stores
located in Jacksonville, Chicago and
the Baltimore-Washington but return
Cont…

• Circuit City realized after years that

location too plays an important role
than looks.
• So they had to close down stores and
relocate them in order to be
profitable.
• While then Best Buy was investing in
customer-centric strategy i.e.
identifying most profitable customers,
The Data Dilemma-:

• They had a lot of data, but could not

leverage that data to improve the
customer experience and boost
revenue.
• The IT department took days to respond
to routine requests for preparing
management reports as Data were
stored across different locations.
• The lack of authentic data had a
deleterious effect on merchandising,
Cont…

• Allocating goods to 600 stores by

merchants by using hand and flawed
data affected forecasting.
• It lacked business intelligence and
customer analysis
•
Bottom Up, Not Top
Down-:

• It has sold off all of its noncore

businesses
 to focus on its core.
• It changed the pay structure for in-
store employees
• the company started to hone its
customer-centric strategy.
• it is improving the customer experience
in its stores by locating accessories
and services close to big-ticket items
Cont…

• Circuit City is also making merchandising

decisions based on what’s important to
the customer.
• customer-focused strategy requires
change management effort inside the
company.
• Thus the company has to give training to
operational staff to participate in
decision making process.
• Managers spend time talking to both
MICHEAL JONES-:

• Focused on standard and fewer

proprietary systems that will provide
company information about
customers, promotions, inventory and
store performance.
• POS system tested for quality
assurance before being piloted.
• Total sales for the fiscal year grew 6.2
percent from last year, and same-
 


Thank you

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