Taking advantage of Circuit City demise

When Circuit City closed about one year ago it left an opening for retailers to gain a larger share of the coveted consumer electronics model. According to a new report from The NPD Group titled "New Look at Retail: Post Circuit City, Walmart and Best Buy, captured two-thirds of Circuit City's total dollar share during the March to December period in 2009 when Circuit City was no longer in business. The report didn’t make mention of which retailer(s) captured the remaining share of the market, but it can be assumed that Target gained from Circuit City’s closing as well.

As a result of Circuit City closing, Walmart gained presence in the TV category, according to the report, and flat-panel TVs was Walmart's best performing category in overall share gains (up 3.2%) among the top categories after Circuit City left the market. In addition, Walmart saw its year-over-year share growth increase faster in notebooks (2.3%) than any other category.

Walmart's main competitor in the CE space, Best Buy, also saw gains in key electronics categories. According to the report, its dollar share of the flat-panel TVs category increased 5.2% during the March to December 2009 period, and its dollar share of notebook PCs was up 5.5%.

"As its nearest competitor, both in store locations and in consumer perception, Best Buy was certain to be the big beneficiary from Circuit City's closure," said Stephen Baker, VP industry analysis at NPD. "However, with the closures coming at the same time as an economic recession, tumbling ASPs in both PCs and TVs, and Walmart's renewed focus on consumer technology as a growth opportunity, it is not surprising that Walmart also managed to grow its share during this period."

Although Walmart and Best Buy are dominating the CE space, that doesn't mean there isn't room for Target, and with such big films as Avatar (see story above) soon making their way to DVD and Blu-Ray, the competition will be as strong as ever.