HMV brand could survive administration

The inevitable administration of HMV has shocked no-one, but the question now is what happens to the brand next.


That HMV and its sister brand Fopp are trending on Twitter and the hashtag #HMVmemories is already running wild demonstrate the positive emotion that the HMV brand continues to evoke in people.

The fact is that HMV’s business model of selling physical CDs and DVDs has been outdated for some time and the chain didn’t do enough, early or quickly enough to do anything about it and halt the decline of its 230-strong store network. HMV didn’t do enough to make its stores exciting and marketing didn’t do enough to tell its story and offer a point of differentiation. The retailer’s latest Christmas activity featuring an animated Nipper the dog, was the first activity in years that tried to tell the brand’s story.

Efforts in the last few years to diversify and modernise by ramping up its digital business, and expand into relevant technology were the right moves, but they were slow to happen and struggled to have an impact against the drag of its traditional retail operation.

Because HMV is entwined with music it has always had an emotional place in people’s lives, more so than other retail brands that have fallen into administration such as Comet or Jessops.

Memories and emotion are not enough to sustain a business but it shows that there is strong opportunity for the HMV brand to remain in some form and I imagine there will be considerable interest in the brand and the authority it has in the music and entertainment sector.

Record labels, which have showed significant support for the brand over the last 12 months, also have a vested interest in keeping it alive in some way which will give strength to any opportunity.


Without the overheads of such a vast retail estate it could operate HMV as an online only retailer and download service better able to compete with online rivals on price than it has until now., a nemesis of HMV’s, ceasing its operations as a direct retailer, has opened up a gap in the online market that could be filled by HMV, although it will be tricky for any business to operate purely as a retailer of physical music and DVDs. Amazon is only able to do so because CDs and DVDs are just one part of its vast range.

A new owner could look at the possibility of running a small chain of almost boutique record or film stores, becoming akin to an independent specialist harnessing its heritage and expertise and making better use of its retail space in a way that HMV has not done as a large scale chain.

It could also take its recent moves into high-end technology and focus stores on this aspect of the business while maintaining its music and film catalogue as an online business, although Comet’s decline signals the challenge in that sector too.

What’s clear about the future of the HMV brand is that it will cease to be a shop on every high street, but the brand could live on yet.



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