It Looks Like hhgregg is Planning a Huge Comeback
The only context that we’ve mentioned hhgregg in in the past few months is in relation to the mounting struggles that the consumer electronics retail industry has faced in 2017. Fair or not, hhgregg is among a group of just two CE retailers (Radio Shack being the other) to have filed for bankruptcy. It officially closed its last brick and mortar location back in May of this year.
So, you’d understand my confusion when, on a Sunday night in the middle of watching the season seven finale of Game of Thrones, I came across a string of retweets from the hhgregg Twitter account. For a moment, my thoughts went to the idea that the account had been hacked, or perhaps someone made a spook account. But the tweets and retweets were nothing malicious—rather, they referenced a bunch of fan art around the old hhgregg mascot and some promotion to bring him back.
If this tweet gets 1000 retweets, we'll make it happen. 🤝🤞 https://t.co/YGnU47I0ee
— hhgregg (@hhgregg) August 25, 2017
— hhgregg (@hhgregg) August 26, 2017
Very little digging lead me to the hhgregg website where I was surprised to find anything other than a “We’re Closed” sign hanging from the home page. Rather, the front page looks more like an early 1990s Geocities kind of splash page with a daily deal listed, with the relaunched mascot proudly displayed beside it. And just below that is a countdown to what’s being called the “Grand Reopening” that looks like it’ll run out on September 20th.
That, of course, prompted me to dig on a slightly more thorough level.
How, after less than three months since it closed its doors, could a company that failed so miserably to attract a potential suitor, go out of business, put all its employees out of work, and then all of a sudden decide to relaunch?
The answer to that question makes perfect sense if you understand what the hhgregg story has looked like since the doors were closed in may—which I now do.
According to the Indianapolis Business Journal, after the CE retail chain went out of business, all of its intellectual property became available and was put up for auction. In late June, the auction went live and a company named Valor LLC was able to purchase the IP property rights for just $400,000, outbidding Sears Holdings Corp. by $50,000. (Hhgregg pulled in annual revenue of around $2 billion per year prior to filing for bankruptcy in March.) The acquisition included everything from the trademarks, domain names, customer filed, social media accounts, and other data that hhgregg accumulated during its 62-year run in CE retail.
Valor LLC, owned by investor Michael Eisner, has connections to multiple electronics-related businesses in New York and New Jersey, according to IBJ. Little other information about the company exists, but IBJ did find that Eisner is linked to another company called Circuit Street LLC, which is based out of Brooklyn and offers “the latest technology in drones and digital cameras.”
Little was made of the acquisition until the middle of August, when a rather innocuous tweet was posted to the hhgregg account, announcing that the company was under new ownership and that they were looking forward to working with consumers again.
We are excited to announce the https://t.co/cuY9zSop5G is now under new ownership!
Looking forward to working with you again soon! 🙂
— hhgregg (@hhgregg) August 17, 2017
Is This Real?
There’s no real information out there about what type of “comeback” this will actually be, but conventional wisdom tells us that there’s no way hhgregg and its new ownership team will attempt to get back into the physical retail game. No brick and mortar locations were included in the auction, so any attempt to do so would have to involve actual real estate transactions and the setting up off a physical shop by the new owners. And, given the current state of affairs in retail, that seems like a risky bet—not that buying the IP rights to hhgregg isn’t in and of itself a risky bet.
Instead, it seems like the new ownership team plans to make this an commence play, and they hope to quickly gain traction and perhaps even a cult-like following by utilizing an “existing” brand that people are already familiar with.
It’ll be interesting to see what actually comes about when the clock strikes zero on September 20th. But until then, we don’t plan to hold our breath. This, right now, seems like it’s destined to be a flash in the pan moment for a company that already experienced total failure once this year.