Radio Shack to Game Shack – Why Not?

Implications: I can think of more reasons why than why not.  I’m not saying Radio Shack should copy GameStop but they could clearly build on what they’ve done, and invent something even more interesting. Nintendo didn’t just take market share from Playstation and Xbox with the Wii, they expanded the market, making video games appealing to a whole new segment.  If they were really imaginative, Radio Shack could do the same with their stores.

Analysis: Why?
1.    After years of muddy and unrealistic positioning, Radio Shack could finally stake a claim against a market they could deliver against.
2.    Their store base and reach is uniquely well suited. Gamers are great at creating their own sense of community – Radio Shack could finally leverage their store base into a meaningful advantage with events and competitions that draw people in, creates loyalty and creates reasons to buy more. It’s rare, but when retail becomes entertainment it’s a powerful thing.
3.    Their store size and layout is uniquely well suited. A switch to Game Shack wouldn’t require significant store remodeling – compelling graphics and modern displays would do it – but they must be innovative and fresh.
4.    Easier time staffing with qualified and passionate employees. The idea of working in a store with the energy and cool factor of video games that pulls in steady traffic has to be significantly more interesting and attractive than recruiting for their current mix. (Which is what again?)
5.    Complimentary merchandising possibilities. Lots of opportunity to merchandise interesting and high margin impulse items around the core category that would appeal to the gamer base.
6.    Rentals.  Great for encouraging frequent visits, and the selection at Blockbuster and Hollywood just isn’t that good -  done correctly, it wouldn’t be hard to take share quickly.

So, why not?
1.    GameStop is firmly positioned with about 4000 U.S. stores, 20% market share and growing.
2.    It’s going to take a lot of work, and more importantly vision and commitment to reinvent itself that may not exist inside the company right now.


But GameShack has a certain ring to it that Radio Shack is sorely missing -  specifically meaning, and, a market.