Despite RadioShack's (NYSE: RSH) best attempts at turning around the business and becoming a more digital-savvy shopping destination, shoppers are not heading there to buy higher-priced items such as phones or TVs, rather, they're mostly looking to pick up last minute, low-cost (but high-margin) accessories.
A new DealNews survey asked just over 2,000 shoppers what kind of items they purchased at RadioShack and how they completed their transaction. The vast majority of shoppers purchased accessories, including cable cords, chargers, batteries, or DIY components, such as resistors and capacitors.
The findings are consistent with RadioShack's historical place in the market, but as it attempts a turnaround, the retailer sorely needs to become a destination for slightly sexier gadgets to compete with brands such as Apple (NASDAQ: AAPL). Solely being a destination of choice for batteries and resistors is not going to cut it.
Furthermore, the study found that shoppers look to RadioShack as a last-minute destination, a convenience stop. Shoppers are going there only when in a bind, not when they've planned to make a tech purchase in advance. A full 57 percent of people who bought accessories or components described the purchase as an "emergency."
Consumers have also been slow to respond to the retailer's e-commerce site. The survey recently found that 90 percent of people who purchased something from RadioShack, did so at a brick-and-mortar store. Only 3 percent shopped RadioShack.com, further cementing RadioShack's position as a "need it now" destination of convenience.
Pricing was the main factor that respondents cited for why they do not shop at RadioShack. Several commenters remarked that RadioShack's prices were considerably higher than its competitors.
RadioShack announced last week it would close up to 1,100 stores, 20 percent of its locations, after reporting a much wider than expected fourth-quarter loss of $191.4 million on plunging sales in the holiday quarter.
-See this DealNews article
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