Marketing Channels 8th Edition by Bert Rosenbloom

Exercise 4

When Circuit City, the world's second largest consumer electronics retailer went out of business in January of 2009, pundits thought most of Circuit City's business would be picked up by the largest consumer electronics retailer, Best Buy, as well as Walmart, which also sells a great deal of consumer electronics products. But the competitive landscape created by Circuit City's demise did not conform neatly to predictions. An Indianapolis-based regional chain of consumer electronics stores by the name of hhgregg decided to take a stab at competing with the giants on a national level. Hhgregg planned to open fifty stores in the very same markets Circuit City had operated in and, in some cases, even in former Circuit City stores. Hhgregg believes it can compete even with the huge Best Buy and Walmart by emphasizing high-end products and superior customer service provided by a highly trained sales force which is paid primarily on commission. Hhgregg believes that its more knowledgeable sales force, which receives almost 300 hours of training in its first year, covering over 500 different products sold in stores, will give it an edge in building a loyal customer base that its competitors will not be able to match.
Do you think hhgregg can compete with Best Buy and Walmart successfully as a relatively small consumer electronics retailer by offering a customer experience that is not available from the giants? Why or why not?