WOW! What a concept: Good Guys, Tower awe shoppers

Discount Store News, August 21, 1995

LAS VEGAS -- While national competitors Best Buy and Circuit City have enthusiastically moved into music and video software, The Good Guys, the leading West Coast CE chain, has resolutely and successfully stuck to its hard goods roots.

All that changed Aug. 11 when the first WOW! The Multimedia Store opened in this new market. WOW! combines a full The Good Guys super store with est Tower Records format in a 60,000-sq.-ft. megastore equivalent to a Best Buy Concept III model, with a coffee and snack bar thrown into the mix.

WOW! is run as a joint venture, with both chains sharing in the profits.

"The concept behind WOW! is to offer a retailing experience that currently doesn't exist-combining a broad selection of consumer electronics hardware along with a vast offering of music, video, computer software, books and magazines, and unparalleled customer service," noted The Good Guys president Bob Gunst.

Tower's Russ Solomon added that 'the ability for customers to sample music has been at the core of our new Tower stores. WOW! allows us to do that in exciting ways and to create a synergy with consumer electronics hardware that will make customers want to stay longer, sample more and visit more often."

The two chains have previously teamed up at least twice, in San Francisco and Los Angeles, but on a more informal basis. The software and hard lines were segregated, and although customers could move from one to the other easily (by escalator in San Francisco), it was clear that the two were independent operations.

At WOW!, all goods will be paid for at the same checkouts. "Operations will be totally integrated from a customer perspective," Gunst said. The two companies will advertise jointly at times, and cooperate on in-store promotions and events. In addition, Tower and The Good Guys employees will work side-by-side.

The store, which Gunst called "an experimental store for both Tower and The Good Guys," could become the basis for a chain itself, Gunst noted. "We both believe [WOW! has] tremendous potential and applicability in other markets," he said.

The new store's selection is impressive, perhaps the best in the mass market. In addition to The Good Guys' power selection of consumer electronics, WOW! stocks 100,000 music CD titles, 70,000 books and magazines, 25,000 videos and laser discs, and 2,000 computer software titles.

Customers can try out a large percentage of each category's software at listening posts, video monitors and computer stations located throughout the store. An enclosed classical music room allows classical buffs to experience the latest releases through an $80,000 home stereo system (for sale) built from Denon and KEF components.

An oversize video wall (which doubled as "the world's largest slot machine" during a grand opening promotion that gave away a new Saturn automobile) supplements a stage area for live musical performances and new product introductions, similar to the approach taken by Tandy's The Incredible Universe chain.

The coffee bar, operated by San Francisco-based Pasqua (which will operate more than 100 locations in larger cities by the end of 1996 and was a recent recipient of a "Hot Concepts" award from DSN's sister publication, Nation's Restaurant News), offers a full selection of coffees, along with snacks, sandwiches and baked goods, as well as a nearby "listening bar," where customers can eat and drink while previewing the latest releases.

The Good Guys competitors will have to look at WOW! with some trepidation. Best Buy, in particular, has leveraged its music and hardware synergy into an industry-leading presence on both sides, and WOW! has a few advantages over its larger competitor. The most notable: access to upmarket brands. Best Buy has been limited in its brand presence by the refusal of some of the most desirable brands (Denon, Onkyo) to supply the chain. The Good Guys has always had access to that level of branded goods, which allows it to avoid the price wars that have periodically crippled other chains' profitability.

Tower is rarely the price leader in any market, but its stores have a cachet with consumers that Best Buy can't match. Tower's national (and international) presence offers The Good Guys a base to expand beyond its West Coast home. Between them, the two chains account for more than $2 billion in sales and operate about 200 units.