RadioShack Rolling Kiosks Into Target Stores
RadioShack says it will put "Bullseye Mobile" kiosks in the majority of Target stores around the country, in an effort to further build its presence in the mobile phone business.
"It's a genius cross-branding move," Cathy Hotka, a retail branding consultant based in Washington D.C., tells Marketing Daily. "Target is known both for its high traffic and desirable demographic, and kiosks selling high-demand items do really well -- this seems like smart partnering."
And RadioShack increasingly wants to be seen as a mobile-phone destination. In addition to kiosks in such retailers as Walmart's Sam's Clubs, it is also a leading seller of Apple iPhones. RadioShack says it has boosted its marketing spending to focus on its mobile wares as part of its ongoing efforts to revitalize the brand.
The plans to expand at Target are the result of a successful pilot project of 100 stores. It will begin rolling the Bullseye Mobile kiosks out to Target stores next month, and expects to be in the majority of Target's 1,700-plus stores by mid-2011.
The move comes at a time when industry giant Best Buy is increasingly focused on Best Buy Mobile, a smaller-format store devoted exclusively to mobile and wireless technology. (In fact, Best Buy has reportedly kept RadioShack in its sights as a potential acquisition target.)
RadioShack also says its second-quarter sales climbed 4.7% to $1.01 billion, compared to $965.7 million a year ago -- while net income gained 8.6% to $53 million, compared with net income of $48.8 million for the same period last year. Comparable-store sales for company-operated stores and kiosks advanced 6.7%.
But overall, kiosk sales fell $7.9 million, which it says is attributable to fewer kiosk locations and the closure of Sprint-branded kiosks in August 2009. Those declines were partially offset by strong comparable-store revenue gains in Sam's Club kiosk locations.
While Hotka says the success of any kiosk effort hinges on how well-stocked they are, "kiosks are all about convenience, and I suspect that in many families -- where it's the mom who handles all things related to cell phones -- this will be seen as really appealing. The kiosk interface is really easy to use," she says. "In fact, I have a feeling these will be so successful we'll soon see them in grocery stores."