RadioShack has been in the retail business for almost 100 years. The end isn’t nearly as promising as the beginning.
Over the Memorial Day weekend, RadioShack—which filed for bankruptcy twice in two years—closed over 1,000 stores, leaving just 70 corporate locations and 500 dealer stores in operation across the U.S. Throughout the weekend, the consumer electronics retailer announced a liquidation sale that played out on social media. Social media represents a new plot twist for America’s dying retailers: How do you toast a brand’s final days when the world is watching?
RadioShack opted for unadulterated bleakness. The company’s social media handle on Twitter shared photos that depicted the sale of store fixtures, $25 grab bags stuffed with items pieced at $5 apiece, and deeply discounted printers. Here are some tweets that highlighted the carnage.
RadioShack, which generated nearly $6.3 billion in revenue at the company’s peak in 1996, saw sales sputter to under $3.5 billion less than two decades later as it failed to respond to the migration of consumer spending to online channels like Amazon.com (AMZN). Electronics were one of the earliest consumer product categories to sell strongly online, resulting in price transparency that made it hard for physical retailers to compete. Best Buy (BBY) has done a better job innovating to stay competitive, partly because it has focused on services to help it differentiate from the crowd.
But RadioShack, which operated over 7,300 stores at the company’s peak, will now only have 570 stores in total after the Memorial Day weekend closures. The press release it issued ahead of the weekend was equally bleak: “We all remember coming into RadioShack whether it was for the battery-of-the-month, new walkie-talkies, or to check out the newest RC toy cars. Many of these nostalgic items will be up for auction over the next 30 days.”
RadioShack isn’t the only well-known name that’s been stung by the shift in consumer spending on online rivals. Payless, Wet Seal and The Limited are among the names that have sought court protection in 2017. Hundreds of stores are shuttering this year.
Not all of those retailers are employing the same social media strategy that RadioShack is using as it announced a fire sale. Take the example of apparel retailer American Apparel. Here is a recent tweet from that company.
What American Apparel doesn’t really signal in the company’s social media tweets: It closed the company’s U.S. store fleet earlier this year, as well as the company’s L.A. headquarters. Gildan Activewear (GIL) paid $88 million for the brand and some manufacturing equipment, but not the physical stores.
But on Twitter (TWTR), American Apparel is keen to tout fashion, not store fixtures. The chain has published tweets that highlighted deep discounts—touting an 80% sale in late March and a promotion for $3 kids gear a few weeks earlier. But all the tweets were accompanied by rosy images of slender models looking stylish. Bankruptcy is a humble process for any retailer, but American Apparel proves it doesn’t always have to look as depressing as RadioShack’s demise.