EAB Year End Report Awake at Night
John Froman, COO of Circuit City, concurred. "When prices drop off 20 to 25 percent per year in some categories, you can imagine the unit increases you need to drive that business….Ultimately you have to drive more traffic into the stores."
Froman pointed to price drops in portable audio but noted MP3 players and hard disk drive portable audio players are giving "a little retail lift….It's OK to have declining prices as long as you have enough innovation that you can keep your overall class declining at a slower rate than it would without the innovation."
JVC Company of America Executive VP and COO Harry Elias ponders who will survive and notes customers are paying for home theater systems or high-end digital TVs. "The dealers that are pushing those products are the ones making a profit."
- Wayne Park