Virgin has announced plans to close all Virgin Music Megastores in the US by this summer:
The remaining six Virgin Megastores in the United States will shut their doors this summer.
To buck declining music sales, the chain broadened its offerings in the last few years to apparel, books and electronics. The six remaining stores took in about $170 million in revenue a year, down from the $230 million from 23 stores at its peak in 2002.
The lack of expansion plans and a recent decision to close the Times Square location in New York, which had been on track to make $56 million last year until the financial collapse began in September, made supporting the rest of the chain untenable, Wright said.
“Our six best stores from a retail point of view are also our six best stores from a real estate point of view,” Wright said.
It looks like the corporate record store may soon be a thing of the past.
Do you think Wal-Mart killed the big chain record stores, was it iTunes, or did they just kill themselves?
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Tags: music trends, new media trends, record stores, virgin
Retail is dying in general. It isn’t just record stores, it is book stores, clothing stores, etc. Big box companies certainly don’t help, nor does the current economic outlook. However, the primary accelerating factor is the perceived value of recorded music in the eyes of consumers.
They killed themselves, there were just in the hands of the record companys anyway, record companys try to sell plastic crap for an overprice, the pop culture is not needed anymore, music consumers look for quality and internet is controlling their input and consuming.
People are learning about music on the Internet and getting it over the Internet – so they don’t need corporate music stores any more.
I’d like something replace the “place” to discover music, though.
Maybe coffee shops will do it?
I guess I’m in the minority here. When I pay money for something, I still want a physical item, like vinyl or a CD. Luckily when Virgin closed here in Vancouver, HMV took them over (although HMV is now going under too). When I can’t find what I’m looking for on the internet for download, I can usually find it there, or they can order it for me…even in vinyl.
@Georg : Interestingly, a lot of artists are using Starbucks to launch their music. If I recall correctly some even exclusively launched titles there.
@Eric : Virgin Megastores were completely separate from their record label interests as was evidenced by the fact that they carried indie releases as well as those from other major labels. Richard Branson operates his companies as completely separate entities which is necessary since his modus operandi is to create businesses that he can then sell off easily without entanglement from other divisions.
@keyofgrey: You are totally right about those facts, but what is the need of a physical boutique in a high-end neighbourhood? Sure those absurd rents has to be paid somehow and its all divided down on the retailprice of an useless piece of plastic.
I can understand the business-idea back in the eighties from mr Branson, but time(read internet) really plunged such pioneering ideas away.
And I agree with you, it’s nicer with the vinyl sleeve in hand while listening than some boring mp3, but I’ll guess we’ll just have to find those collectors markets instead, one just opened in my hood.
So Virgin is dead, but Amoeba is thriving? Too bad none of these failing record stores are cognitive enough to find out WHY Amoeba is doing so well. I have my own theories, like Amoeba is just a really cool place to hang out in besides shop. It has a community spirit that is missing from most retail businesses.
Wal-Mart’s selection of music is droll and caters specifically to the lowest-common denominator. The fact that Wal-Mart can beat record stores at music sales illustrates the sad lack of intellect in our modern culture.