As per usual, recessionary times are times where those with lots of money buy those without lots of money. Such is the case with Bell buying up The Source. BCE Inc, a privately held income trust, is taking this "daring yet risky" to rapidly penetrate the mall scene, where Rogers Communication Inc. and Telus Corp. have been aggressively making their presence known through branded outlets across Canada.
A few marketing related observations:
-The Source was previously owned by the now-non-existent Circuit City, which went into bankruptcy protection and liquidated last year
-The Source used to be called "Radio Shack" in Canada
-Despite (or because of) the recent rebranding, The Source has been profitable over the last 7 years
-The Source competes mainly with Big Box stores such as Future Shop, Best Buy, and Wal-Mart
-It has been able to maintain a niche market amongst gadgety type men who come to the stores to buy trinkets for their at home race car projects and the like
Since The Source is an "electronics store" rather than, say, a "cell phone store," it allows Bell to sell its whole line of communications products from cable, internet, phone, and satellite services.
I don't really see any obvious alignment between the two brands, and I wonder how much rebranding they'll do to The Source. Keep it as The Source? I feel like the brand equity isn't that big of a deal since it's a fairly new brand as it is. And the "by Circuit City" part, although long-gone, still lingers in the mind and may have negative connotations. Change it to some sort of Bell store? This may alienate people who purchased there for non-cell-phone related stuff. And the little DIYers around the country generally don't take kindly to major corporations impeding their pet projects.
Overall I'd say smooth move Bell! I look forward to seeing what is in store!
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2 comments:
Don't see any alignment with the two companies? Bell bought The Source to have another distribution outlet for their products and to complete with Rogers who currently has a lot more retail stores and places to buy their products than Bell does. They will begin sell Bell products at the Source in January 2010.
You're right - The Source is an electronics store and not a cell phone store, but Bell isn't just a cell phone company. They also offer digital cable and so every time someone buys a TV from the Source, Bell is now able to leverage that purchase and offer a Bell ExpressVu service. And with the Source in the US declaring bankruptcy, I don't think the future looked too bright for this beloved Canadian retail chain.
Alignment as in marketing and branding alignment. Bell to me seems to exude family values, making this better, almost perpetuating the "Ma Bell" persona that they've had for so long. The Source is a smaller, quirky, geeky, mall outlet, across-from-a&w sort of deal. Which is why I wondered whether or not they would rebrand The Source.
As you saw from my post, I indeed mentioned that Bell has a whole host of communications products that they offer. I am reluctant, however, to believe that the electronics geeks will appreciate being peddled Bell products by The Source...the Early Adopter and DIY types tend to value knowledgeable, friendly, and unbiased opinions.
The conclusion: I miss Radio Shack! It was so cute.
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