Circuit City Richmond, Va.

With $9.8 billion in sales for the fiscal year ending in February (a 2 percent decline from the previous year), Circuit City is the No. 2 electronics retailer in the U.S. behind Best Buy, according to Hoover’s Online. (The latter’s sales were up 17 percent to $24.6 billion.) Circuit City has been shutting down some underperforming stores and reopening them in more high-traffic locations, at a rate of 10 new stores per year (compared to 60 per year for Best Buy.) The client tends to attract an older, loyal consumer based on its commitment to customer service, says one insider. Best Buy, though, has stepped up its own customer service, encroaching on Circuit City’s positioning. There are also differences within the stores themselves: Best Buy’s tend to be warehousy, boisterous, colorful and experiential, giving customers lots of interaction with the floor-model electronics. Circuit City allows customers to sample products too, but the atmosphere is funereal by comparison. The retailer’s own research shows that customers think the stores are too quiet and they feel as if they’re being watched

The Scoop:

“Our in-store experience is a bit more rational. It doesn’t tug at the emotions quite as much” as Best Buy’s, says Justin Lewis, Circuit City vp of marketing. The client has asked finalists to show how, if the chains were side by side, they would “get the consumer to turn left” into Circuit City. The RFP emphasized retail and creative credentials, as well as success with challenger brands and in differentiating parity brands. Otherwise, the shops are free to “blow out their positioning in any way they see fit,” Lewis says. The client pushed FCB to evolve its “We’re with you” campaign, focusing on the chain’s service heritage, but the ideas were not accepted, and the search was launched in February. Toys R Us vet Ernie Speranza joined in April as CMO and is leading the review committee. Contenders who have met him call him “smart” and “impressive.” Other decision makers are CEO Alan McCollough, Lewis and evp of merchandising Kim McGuire. Hasan + Co. in Raleigh, N.C., is managing the search. Final presentations are this week. Richards goes first, then McCann, then Doner. The client has said to expect a quick decision.

The Contenders

McCann Erickson New York

The Interpublic Group shop, the largest contender, will seek to focus on the “bling-bling” of what are essentially luxury purchases and on convincing consumers, whose perception is that Best Buy has lower prices, that the two chains are comparable in that regard. It will tap its McCann WorldGroup sibling Momentum, which has extensive in-store ad experience (Coke, GM), to present promotions and event ideas. The pitch-team leaders—North America regional director Eric Keshin, along with New York chief creative officer Nina DiSesa and top planner Suresh Nair—are fresh off landing the $300 million-plus Verizon Wireless account. Greg Fujimoto, who runs the shop’s Wyeth and Nestlé accounts, has worked on Lowe’s, Major League Baseball and Microsoft’s Xbox.

Doner Southfield, Mich.

The Midwest independent will present a strategy that focuses on individual customers’ ability to connect with the right product, rather than the in-store experience or selection. There will be no weird spokesperson in the creative like the ones the agency has developed for Blockbuster, Red Lobster, Mazda and other clients. Doner’s team includes CEO Alan Kalter and evp/account management Kevin Weinman, who runs the Blockbuster account.

The Richards Group Dallas

The other independent will focus on a perceived advantage —expertise—and, in line with Circuit City’s reputation for customer service, will portray the chain as a place people can go to get knowledgeable answers to their consumer-electronics questions. Like McCann with Lowe and Doner with Blockbuster, principal and founder Stan Richards and his team come to the presentation with top-drawer retail bona fides—in this case, through its Home Depot client. Also on the team are principal Brian Schadt and account planning group head John Baker, both of whom have worked on Linens N Things, which, like Circuit City, is playing catch-up to an aggressive rival, Bed Bath & Beyond. Richards’ most recent win was in March: the $100 million Red Lobster business.

–Compiled by Kathleen Sampey
–Contributors: Jack Feuer, Trevor Jensen and Kevin Ransom