February 1, 2017 Leave a comment
While this story is more of a Canadian story, it shows [in some cases] the incompetence of management.
HMV Canada, related to HMV in the UK and elsewhere, went into receivership last week after being in business for 30+ years. Currently the largest Canadian record chain in Canada, they have shut down various stores across Canada over the past few years.
I am not really surprised at what has happened. Gone will be 100+ stores and something like 1300+ jobs by the end of April.
Back in the 1980s into the 1990s there were doing well with stores all over. There was country and regional chains competing such as Sam the Record Man, A&A, Discus, Sunrise and Phantasmagoria. Most of those chains have also reduced stores or have closed up but none as big as HMV.
HMV started an online store in the mid-1990s, but sometime in the late 1990s as online purchases were increasing, HMV suddenly closed their online store.
They would later re-open the site more like a catalog where you couldn’t order but then did re-open to purchase online. By then they weren’t doing so well. Add to the problems is that the site was slow and the search engine was slow. Even worse, they would not include any pre-orders [unlike Amazon and others]. As well, no download option available. Many items sold had no description and many had ridiculous prices.
They also opened up a points system where for every purchase you would get points that can be cashed in for discounts. Problem was [for me] I wasn’t purchasing much and they charged a fee to join. It took me 2 years to get back the money to join. I cashed in and tossed my card into the garbage.
I remember the days when you would huddle in the cold outside on Boxing Day [the big sales day in Canada the day after Christmas] waiting for the doors to open with excellent deals and Guns N Roses’ Welcome to the Jungle blasting as the doors opened.
In later years they would change the deals to 4 for the price of the most expensive 3. More recent, they would just give a decent deduction on selected items [very few recently released] while everything else was at their usual price.
HMV was known to jack up their prices during the Boxing Day sales to claim a bigger discount. A few days before, I would routinely walk into the main store near me and “scout” the deals of what they could be selling it for before the Boxing day discount. So something at a selling price of $50 prior to the sale was now $80 but they are offering it at $40. So that $40 off was really $10 off. [An office store is known to do the same thing selling (for example) a printer at a regular price at $150 but the competition’s regular price is $100.] In recent years just hours after the Boxing Day sale began, the number of people in the store looks like any other day. In the old days, you would walk in the store 5 hours after the sale began and it would still be quite busy.
Then there was their policy regarding matching prices [just matching, no further discount]. A regional chain had a promotion for a CD advertised in a newspaper for $10. HMV initially would not match it. It was above the price they claimed they get from their distributer. Eventually a manager allowed the discount. That regional chain had 4 stores at the time versus 130+ stores for HMV. Don’t they have buying power?
Another time they pulled all the merchandise from Elton John after another chain got an exclusive box set. They did the same thing twice to The Rolling Stones and probably others. [They did leave a note that clients could still order from them but did not leave a reason why the stock was pulled. But I’m sure some people guessed.] But when lesser known artists gave another chain an exclusive, they didn’t pull anything. With stock pulled, it was an incentive to just buy elsewhere.
Recently, even with new releases they are just not competitive even with fewer competitors. They’d charge $30 for a new Blu-ray release while the competition could be charging $25. [This was not the norm as you could get some good deals in some cases.] In some cases you would see a CD or a movie priced at $20 and in the same bin the exact same moving at two for $20. Doesn’t make sense.
Finally, they would waste store space in front as you walk in to try and sell you movies and music at discounted prices but it is the same stock they’ve been trying to push for months if not years.