RadioShack To Streamline Private Brands
RadioShack CEO Joe Magnacca told analysts this week that the company would enhance its focus on the Radio Shack brand, in part by streamlining its other private brands.
The goal, Magnacca said, is not to focus on the private label share of sales at the store, but to avoid duplication with national brands.
“We are planning to rationalize the number of brands that we have and revive the technology innovation capabilities that are part of RadioShack's heritage,” Magnacca said, according to transcripts of the analysts call from Seeking Alpha. “You can already see this in our audio headphones and Bluetooth speakers, and more products like this are in the pipeline. This will also manifest itself in the do-it-yourself categories, where we have new microcontrollers and kits coming this summer.”
Magnacca said that balance would be the key in the private label strategy of Radio Shack’s future.
“As a business, we'd probably move to more of a private-label strategy where we became more national brand equivalent and put more focus on brands,” he said, according to the Seeking Alpha transcripts. “And I would suggest that not that the balance of our business is necessarily wrong, but how we actually participate in that segment is not where I'd like it to be. I'd like us to be a more leading-edge as opposed to more me too, and avoid duplication of SKUs with some of those strong national brands.
“So it's not about penetration, it's about what's in that SKU assortment within our brands. And as I mentioned, we're within private brand looking at everything, from the brands we currently operate under, because we operate under many brands, including Point Mobile and Gigaware. But we believe we have tremendous equity inside the RadioShack brand itself in that portfolio.”
Radio Shack announced a pair of executive hirings, with Jennifer Warren becoming the chief marketing officer and Michael DeFazio moving from Walgreens to becoming the senior vice president of store concepts at Radio Shack.
Leveraging the company’s brand will be important, Magnacca said, and is one of the areas he believes will bring growth for Radio Shack.
“We have a powerful brand that has stood the test of time for nine decades and has a large loyal customer following,” he said. “We have strong relationships with leading vendors and a portfolio of trusted private brands that offer highly innovative technology products.”
The moves also will bring changes to the Radio Shack stores. Magnacca said many of the in-store changes to come would not require additional capital, but were ways to help the company improve the customer experience.
“Over the next few weeks, you will begin to see the new brand platform, which is focused on Let's Play,” he said, according to the Seeking Alpha transcripts. “With our vast store base, we want to become the neighborhood technology playground, and there are many ways you'll begin to see this come to life in our media communication plans, from TV advertising and weekly new newspaper inserts, as well as all other forms of consumer touch points, including social and digital.”