HMV steadies sales as brand bounces back

The improvements HMV has made in store layouts and marketing initiatives appear to be paying off after data shows it has stolen share of the entertainment market back from the supermarkets and consumer perception of the brand are improving.


The latest figures from Kantar Worldpanel show that HMV accounted for 14.7 per cent of the entertainment market in the 12 weeks to the 6 July. This is down slightly compared to the same period last year when its market share stood at 15.1 per cent, in the most part due to store closures.

However it is up compared to the previous quarter when it had a 13.6 per cent share and some way above its 10.7 per cent share when it collapsed into administration last year. Fiona Keenan, strategic insight director at HMV, says the “strong performance” over the past quarter is in part due to winning some shoppers back from the grocers.

The big four supermarkets are seeing sales slide as more consumers head to convenience stores, which are less likely to sell entertainment products, and the discounters to do their shopping. Keenan estimates that 1 million less shoppers bought entertainment products at the big four in the past 12 weeks.

Tesco experienced the biggest slide, with its market share dropped 1.8 percentage points over the past year to 14.6 per cent. The rest of the big four also saw market share declines.

HMV has also been helped by shoppers spending more in its stores, with average basket size up £3 over the past 12 weeks. Last month, Paul McGowan, boss at HMV’s owner Hilco, told The Telegraph that HMV was “very profitable”, with like-for-like sales up by 9.2 per cent.

The retailer has attempted to make its shops more appealing to customers since being bought out of administration by Hilco last year. It has redesigned store layouts, as well as holding live events such as gigs and record signings, and launched marketing initiatives including a revamped website and pureHMV loyalty programme.

This has had an impact on consumer perceptions of the brand, with YouGov Brand Index showing statistically significant increases across all metrics over the past year. This includes a 2.5 point increase in its Index score, a measure of a range of metrics including value, quality and satisfaction, and a 5.4 point improvement in its Impression ranking.

Elsewhere, Game and Argos increased their share of the entertainment market, mainly due to strengthening game sales as Microsoft, Sony and Nintendo continue to launch high-profile titles for their latest consoles. Amazon remains the market leader, increasing its share by three percentage points over the past year to 21.8 per cent.

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