Sony's `Gallery' Has Retailers Hearing FootstepsJames E. Ellis
It's not your typical electronics superstore. First, it's on Chicago's tony North Michigan Ave., within a block of such carriage-trade haunts as Cartier, Burberry's, and Saks Fifth Avenue. And its ambience is as stark as a museum's, with boom boxes and the hot-selling 8mm camcorders on pedestals like so many objets d'art. Even the service is extraordinary: A few days ago, a technician hustled off to teach an elderly browser how to operate her TV's remote control. "We don't care that she didn't buy it here," explains Elaine M. Reck, manager of Chicago's just-opened Sony Gallery of Consumer Electronics. "It was a Sony, and we want people to feel comfortable with our products. That way they'll buy Sony again."
All that's making Sony Corp. of America's new store the talk of the electronics trade far beyond the Windy City. Opened on Dec. 11, it's Sony's first bid at retailing in the U. S. Only two more storesin New York and Los Angeles are planned, but some retailers worry that Sony may get to like hawking its own wares. "Since it already operates its own licensed stores in Japan and Europe, the question is: 'Is this just a toe in the water for Sony?' " worries Robert Sirkis, president of Philadelphia-based Silo Inc., the No. 2 superstore operator.
Sony executives say that such fears are misplaced. Making money from the Gallery isn't the goal, they say. Rather, Sony wants to bolster its already well-tended image by offering in-depth product information and demonstrations in elaborate "lifestyle" settings. For instance, the Chicago Gallery has a life-size mock-up of a small apartmentcomplete with bedroom and kitchenwith a built-in Sony home theater system. The Walkman is displayed on trendy mannequins posed at sport and play.
The Gallery also will showcase new Sony technologies that many stores don't carry yet. An entire wall in the three-story Chicago store is devoted to demonstrating Sony's new Data Discman, which uses a small screen to display "books" on compact disks. There's also a prototype of Sony's high-definition TV technology. "We want to set up oases to showcase Sony's full product line and explain the premium technology behind it," says John Briesch, president of Sony Consumer Products Group.
Such image building is increasingly important as the consumer-electronics business matures. With VCR sales slowing, growth has dropped to less than 3% annually, according to the Electronic Industries Assn. Moreover, most superstores and lower-service retailers stress price over features. "We need to explain why Sony products deserve to be higher-value purchases," says Briesch.
NO COMPETITION. Sony isn't alone in looking for new ways to stand above the crowd. French giant Thomson's U. S. consumer-electronics group, which manufactures the RCA and General Electric lines, is also trying to get more feature information to consumers. Thomson has installed its InfoTheatre product information systems in about 1,000 stores that sell its premium-priced ProScan and RCA lines. Using a videodisk player and a 35-inch TV, InfoTheatre allows customers to select consumer-electronics topics from a menu and have explanations and demonstrations provided by the system.
To avoid competing with its retailers, Sony says the Gallery will only sell products at full retail price. It also will refer shoppers to local Sony dealers, whose prices usually are lower. Retailers are taking a wait-and-see attitude. "From what I've seen, Sony has done an exceptional job of illustrating the high-quality nature of its technologyand that's good for everybody," says Richard M. Schulze, chairman of the Best Buy Co. superstore chain. But cautions Schulze: "If they decided to put up 15 of these in Chicago, I wouldn't be so positive."