Radio Shack Breaks Campaign In Support of New Positioning

First Work From Agency GSD&M

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In its latest brand-positioning shift, struggling consumer electronics retailer Radio Shack Corp. is emphasizing one of its longtime, core tenets: customer service.

A new national advertising campaign called "Do It Together," from Austin, Texas-based GSD&M, aims to show how Radio Shack and consumers can collaborate to solve technological problems like connecting today's many devices, said Jennifer Warren, the retailer's chief marketing officer since April. Four 15-to-30 second ads, plus two more ads targeted specifically to the Hispanic market, will roll out beginning in early February during prime time and sporting events; radio, print, digital, social and in-store marketing will support the campaign. The new ads will invoke a full tagline: "It can be done, when we do it together."

Ms. Warren said she realized after visiting multiple Radio Shack stores that consumers looked to the retailer as a place to help solve their technology-related problems, as opposed to a place to engage and play with equipment. "We identified this gap between what our customers and prospective customers believe can be done through technology and the knowledge to actually go and get it done," she said.

In one upcoming ad, a father of eight children goes to a Radio Shack store with his entire brood, who are asleep -- and more than one is strapped to him. Dad's problem: he wants to watch an action movie at night without waking up the kids. Radio Shack's solution: plug headphones into the Roku box.

GSD&M became Radio Shack's agency of record late last year, and the ads are the agency's first work for the Fort Worth, Texas-based retailer.

A hexagon pattern that appears around the "D.I.T." tagline is meant to emphasize the collaboration store associates and customers have when working together to connect technologies that usually aren't of the same brand, said Scott Brewer, group creative director at GSD&M. "In the [physical] retail world, there are not a whole lot of places left where you can go in with an idea and work with somebody to make that idea come to life," said Mr. Brewer. As a result, each ad will highlight a project table in a store, he said, where the consumer and the store associate work together.

The campaign will filter through to stores via signage and will be executed thanks to ongoing formal training of Radio Shack's 30,000 store associates. Meanwhile, Radio Shack associates will get help servicing customers efficiently via the company's new internal social-media-like tool, said Ms. Warren. She said it will help associates from the retailer's 4,300 U.S. stores easily share common problems and solutions.

According to Kantar Media, Radio Shack spent $88 million on measured media in 2012. For the first nine months of 2013, the company spent $42.8 million on measured media.

DIY stations
Radio Shack has lately worked to revamp and modernize stores, with 22 new "concept" stores with interactive displays, speaker walls controlled by tablets and "Do It Yourself" stations where shoppers can get help planning projects from sales associates. Over 100 newly merchandised stores also have ways for consumers to engage with product by testing speakers, tablets and headphones. That's in addition to new private label packaging reflecting the new brand identity. The company has also reduced SKUs in an attempt to bring in the new latest and greatest technology.

Still, financial troubles continue for the retailer, which has struggled to establish a firm turnaround over the last few years due in part to competition from larger players like Best Buy, eBay and Amazon. In the most recent third quarter, Radio Shack's sales slipped to $805.4 million from $898 million the prior year, while its net loss more than doubled to $112.4 million. Analysts expect Radio Shack to swing to an 11-cent per-share loss in the fourth quarter and significantly widen a full-year net loss to $2.09 a share.

Liquidity concerns have also plagued the retailer. Radio Shack said in December it closed on new financing totaling $835 million; it had ended the third quarter as of Sept. 30 with $316.4 million in cash.

Trading at around $2.50, Radio Shack shares have lost three-fourths of their value over the last five years. The stock's most recent high of $21.57 was reached in April 2010.

On the leadership side, in addition to adding Ms. Warren, the company in February hired a new CEO, Joseph Magnacca. Other position additions in the last year have included: chief financial officer; senior VP-store concepts; senior VP-inventory planning and allocation; chief merchandising officer; and senior VP-global sourcing.

The new "Do It Together" campaign is the next evolution of the company's most recent "Let's Play" brand platform, launched last spring, according to Ms. Warren.

"Let's Play" was "a campaign that I would say was a good step in the right direction that told consumers that now when you come into the store we have the technology that you can touch and feel and play with," said Ms. Warren. "But what we learned was that our true differentiation was our people."

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