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Why the fall of HMV is bad for tech

Andrew Williams by

HMV logo
HMV logo

On the evening of 14 January, HMV announced it was to bring in the administrators. The 90-plus year-old music retailer is on its last legs. And while it’s obviously a significant blow for music and film - as one of the last well-known high street sellers of CDs and DVDs - it’s bad news for tech too.

HMV – a pillar of high street tech?

The HMV brand is recognised as one of the UK’s leading sellers of CDs and DVDs. But nowadays it is also one of the premier retailers of popular tech, sitting alongside stores like PC World in many towns as the only place where people can get hold of the latest tablet from Samsung or the new £300-odd headphones from the Beats by Dre. range.

But when did HMV become such an important part of high-street tech? Earlier than you probably think. Before the boom in tablets and “style” oriented headphones, HMV stores across the country were already the key place on the high street to sell earphones – helping to introduce many gadget-buying saplings to brands like Sennheiser and Skullcandy. How many of you bought your first "proper" earphones from HMV?

Until fairly recently, though, the tech section in HMV stores was often relegated to a corner. That all changed in 2011.

HMV began to capitalise on the style headphone movement. It was the perfect match too – what better shop was there to promote musician-branded headphones than a music shop that sold headphones? As HMV CEO Simon Fox said to the Guardian in October 2011, “When acts like Lady Gaga and Justin Bieber come in to our stores, it is to promote their headphones.”

In January 2012, just a year ago, HMV made its move towards tech more formal. As the company’s share of the games market decreased, following pressure from the cut-price tactics of supermarkets, CEO Fox detailed how HMV has changed its ways.

In a trading update, HMV announced that 144 stored had been refitted with a renewed focus on tablets and headphones, and that technology sales had leapt up by 51 per cent. Fox said that the company had sold “500,000 headphones and 20,000 tablet computers [in the five-week lead-up to Christmas]”, that “the fact we’ve become the number one retailer of headphones in such a short period of time shows they fit very, very well with our brand.”

Although HMV’s headphone-centric strategy conveniently synchronised with the increase in popularity of headphones like the Beats by Dre. range, the company has also been responsible for the continued proliferation of high-quality, stylised sets.

Beats by Dre.

HMV has become the key UK reseller for several up-and-coming audio brands, including House of Marley, RHA and Soul. If HMV’s are to close up shop, where will these brands go? It’s a similar story for tablets. Samsung may not need HMV’s help, but the chain’s shops are some of the last places you can still find tablets from Archos on the high street.

HMV has largely done right by these brands, which would struggle to garner much attention elsewhere, too. It’s one of the few stores that lets buyers audition headphones, and prod tablets.

Taking one mid-level store as an example, HMV Wimbledon gives over somewhere between a quarter and a sixth of its shelf space to tech. Tech has a more prized position than either music or video games.

We’re losing one of the best ways for tech to be showcased on the high street. And that’s a shame.

An Inevitable End

However, as the BBC reported, retail analyst Neil Saunders cites that the demise of HMV “was always inevitable.” Even during the early months of its turn towards tech, HMV was already on the brink of collapse. Its stock price barely crept above 5p a share during 2012, having spent most of the time from 2000-2008 well above £1 a share.

HMV has been circling the drain for some time, but that doesn’t mean we’re not losing something worthwhile – even if it is no longer worthwhile to its shareholders.

Go to comments

Leslie Dyke

January 15, 2013, 10:56 am

HMV have no one to blame but themselves - they would refuse to drop the RRP for some reason, and whilst video games aren't their main sale, as discussed in this article, they are (or were 2 weeks ago) selling Halo 3, a game from 2007, for the RRP when it was first released (£34.99). HMV was run by a stubborn, incompetent board of directors who are so stuck in their ways that they let the company rot from the inside out.


January 15, 2013, 3:05 pm

Beats by dr dre are terrible headphones, I only went in there to see how much more power and detail my £65 Audio Teknica headphones had compared to the £175 beats were. The assistant told me beats are the best money could buy, joke. They didnt even know what igrado was. I think HMV was bad for tech. It can't be hard to read the odd review and look at tech specs to work out what's good or bad in the thing you are selling. Same as comet, the staff were clueless.


January 15, 2013, 3:59 pm

I also think they forgot their roots, I know I'm in the minority. But I actually like buying cds, going to the cd booth/shelf where you can listen to new music and buy. Yes you can do this on line, (an I do) but over the years to me at least it became a dvd store and only sold music for x factor crowd (again not that's a bad thing it terms of money making). so I stopped going, as the selection decreased the RRP didn't so it only made sense to shop on line. To summarise, they chased the quick £ and they lost a base of consumers, who themselves now have to shop on line (like it or not)


January 15, 2013, 5:52 pm

HMV have got themselves to blame. They didn't adapt to the digital revolution fast enough - it was a case of 'let's bury our heads in the sand and hope that it all goes away'. Poor decision making, ill thought and poorly executed strategies and poorly, laid out stores with overpriced goods. I'm surprised they survived for as long as they did. I feel sorry for the 4000 employees though - at this rate, this country won't be left with anything left except mass unemployment and rioting.


January 16, 2013, 12:26 am

I've been guilty of doing some shopping at adsa, getting a bottle of wine, a few beers, some popcorn a few essentials and throwing a blu ray in my trolley from time to time. Can't remember buying a cd from one of these shops. All shops are struggling because of supermarkets, amazon and spotify.


January 17, 2013, 4:48 am

There is more to tech than overpriced tacky celebrity branded headphones and iPod speakers. HMV lived off their dominance in the high street for too long and abused their position by charging customers top whack for everything. As soon as customers had a choice of good cheaper online alternatives, that's where they shopped next. HMV were also incredibly slow to develop an online presence and even then fulfilment was a joke. It did feel like they were sticking their corporate heads in the sand and hoping all this new competition would go away. A terrible shame for the staff but the best thing the administrator or whoever takes over would be to sack the existing senior management and bring in some new talent. The brand probably still has some loyality but they need to improve their offering to consumers

Jason Matthews

January 17, 2013, 10:09 am

Apart from the obvious mistake of missing the boat on the download market, HMV helped their demise further by selling ipods to their customers, who presumably never came back as they could get their music from itunes. The stupidity is incredible and their management need a good slap.


January 17, 2013, 11:44 am

I feel about HMV going under the same as I feel about Jessops. Its such a shame and such an incredible waste.

People love photos. People love music. All these shops had to do was figure out what they could offer that folks couldn't get online, then make a business out of that.

In HMV's case, they could have created mini-gigs in their shops, or "meet the star sessions." They could have run music workshops in conjunction with a music teacher. Or what about competitions where if you buy an artists' CD, you automatically get entered in to a prize draw for tickets to their gigs? They could have partnered with an established music magazine and promoted music journalism, or explored music art more.

There are so many ways to leverage passion. Its just a lack of independent thought that let these places fail.

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