Sony makes quiet foray into retail - East Valley Tribune: Business

Sony makes quiet foray into retail

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Posted: Monday, October 18, 2004 6:26 am | Updated: 5:53 pm, Thu Oct 6, 2011.

COSTA MESA, Calif. - Few people took notice when Sony Electronics Inc. opened a tiny storefront last year here at South Coast Plaza, a swanky mall south of Los Angeles.

As it turns out, the small store would represent a big change in how Sony sells its televisions, DVD players and other gear.

Since opening its first store last year, Sony has quietly opened stores in seven other cities. The Japanese giant will open in its 11th and 12th U.S. stores this month, in Denver and Las Vegas, and expects to have about 30 Sony Style stores in the United States by April 2006.

Some retailers that sell Sony products worry they will lose sales. They also worry that if the stores are successful, other manufacturers will open stores, too.

‘‘We’re going to watch very closely what they do with these stores,’’ said Tom Campbell, vice president of Ken Cranes Home Electronics Inc., a chain of eight stores in Southern California. ‘‘The manufacturer is becoming a potential competitor.’’

Apple Computer Inc. has opened 84 stores nationwide since 2001. Dell Inc. has its own kiosks, but neither depends much on other retailers to sell product — at least not to the extent that Sony, Panasonic Consumer Electronics Co. or Samsung Electronics America Inc. do.

Abt Electronics, which has a large store near Chicago, isn’t hiding its displeasure.

‘‘We want our vendor to be a vendor, not a retail competitor,’’ said Mike Abt, presi dent of the company’s Internet unit.

Sony is moving into ritzy shopping malls based on a widely held belief that conventional electronics stores do a lousy job with women. Its storefronts sit next to Tiffany, Louis Vuitton, Sephora and other boutiques that appeal to women — a stark contrast to the "big-box" electronics stores in strip malls.

Dennis Syracuse, vice president of Sony Style Retail, crashed a Tupperware party as part of his research to watch how women shop. His conclusion: Women do more homework than men.

At every Sony store, a ‘‘concierge desk’’ greets shoppers, because company research suggested the feature appeals to women. The aisles are wide enough for strollers. Televisions are perched on different stands, instead of lined in rows at the same height, to give shoppers a better sense of how they will look in their living rooms.

Sony has yet to show, though, that it can master the mechanics of retail in the United States, such as making money off warranties and installation, but it may prove more adept than traditional chains at explaining certain products to consumers, said Wade Fenn, a consultant and former executive with Best Buy Co.

Sony’s stores probably won’t hurt Best Buy and other huge retailers, but they may harm smaller chains, he said. Representatives of Best Buy and Circuit City Stores declined to comment.

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