Store-within-a-store has been making headlines of late, though
the concept is nothing new to retailers. Owing to the shift in
consumers' buying behavior, retailers find this approach more
viable and profitable to reach the target audience. The strategy
seems compelling for many retailers and is often considered as a
game changer, as it facilitates displaying different brands under
one roof and ensuring a rise in footfall.
Simply put, and as the term denotes, the retailers offer space
to product makers inside their own stores in return of rental
fees. Product manufacturers in turn appoint staffs by themselves
to manage the counter, thus lowering overhead expenses for
retailers. Manufacturers are also in constant fight to avail the
best space and offer efficient in-store customer service. The
concept works for both the parties - while retailers are saved
from managing inventories of these manufacturers, the product
makers do not have to set up their own stores.
J. C. Penney Company Inc.
) is one such retailer which has been focusing on this business
strategy for quite some time. We believe this might be a clever
move for the company to reinvigorate growth. The company already
showcases shops-in-shop from brands such as MNG Mango, Liz
Claiborne and Sephora, and more remain in the pipeline.
J. C. Penney added 681 Joe Fresh apparel shops within its
stores in the latest concluded quarter and plans to add newly
designed home departments during the second quarter of fiscal
2013. J. C. Penney also has plans to add 60 more Sephora stores
in this fiscal.
The recent one to join the league is consumer electronic
Best Buy Company Inc
), which has been facing stiff competition from industry
bellwethers such as
Wal-Mart Stores Inc.
) to increase its footfall, sales and profitability.
Best Buy is leaving no stone unturned to woo consumers and
attain incremental revenue, and it is well evident from its
strategic initiative of opening over 1,400 "Samsung Experience
Shops" within its stores, announced in April. These shops offer
Samsung's smartphones, tablets, laptops, cameras and other
accessories. The model seems to be working for the retailer,
which also has a dedicated floor area for
Taking the initiatives further, Best Buy recently unveiled its
) to roll out "Windows Store" across its 500 outlets in the U.S.
with an additional 100 in Canada. The stores will feature
Windows-based PCs, tablets, Windows Phone, Xbox and various
accessories. Unlike Apple stores, which are approximately 200
square feet, these "Windows Store" will essentially cover 1,500
to 2,200 square feet and will employ 1,200 sales associates.
Microsoft has been grappling with plummeting sales of Windows
8 operating system and believes that the platform provided by
Best Buy would help them reverse their fortunes. For Best Buy,
the deal adds more compelling products to its portfolio to better
compete against the discount giants and online retailers.
Now, it remains to be seen whether the store-within-a store
concept can put these companies back on the growth trajectory and
lead as an example for others to follow.
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