Circuit City was an American consumer electronics company founded by Samuel Wurtzel in 1949. By the 1990s, Circuit City became the second-largest consumer electronics store in the United States with annual sales of $12 billion. On March 8, 2009, Circuit City shut down all its stores. On January 8th at the 2018 Consumer Electronics Show in Las Vegas, Circuit City’s CEO announced a comeback and relaunch of Circuit City into “a dynamic, a social-focused e-commerce site” and a new business strategy for its retail stores12.
In this case study, assume that Circuit City hired you as the new chief information officer (CIO) to help relaunch the company into a global e-commerce multinational company.
The following information should be covered in the research paper.
1. History of Circuit City
2. What were the issues and challenges that caused the collapse of Circuit City in 2009?
3. What are the issues and challenges with Circuit City 2018 latest e-commerce initiative?
4. Discuss the major competitors in global e-commerce.
5. How would IT deliver value to the business?
6. Proposed the IT infrastructure required to support global e-commerce
7. Proposed the IT budget for the e-commerce initiative
8. Discuss the IT-based risks associated with global e-commerce
9. Discuss how IT can leverage innovative technologies such as social media, big data, and business intelligence to provide value to the business
10. Discuss the future or emerging technologies that would be leveraged to give Circuit City a competitive advantage.

Sample Answer

Sample Answer


The Rise and Fall of Circuit City: A Journey to Rebirth
The story of Circuit City is both one of triumph and tragedy. Founded in 1949, it quickly rose to become one of the largest consumer electronics retailers in the United States. However, in 2009, the company faced a devastating collapse that led to the closure of all its stores. Now, in 2018, Circuit City is attempting a comeback with a new e-commerce initiative. As the new chief information officer (CIO), my role is to help relaunch the company into a global e-commerce multinational company. This research paper explores the history of Circuit City, the issues and challenges that caused its collapse in 2009, the issues and challenges with its 2018 e-commerce initiative, and proposes a roadmap for success.

1. History of Circuit City
Circuit City was founded in 1949 by Samuel Wurtzel as a small television store in Richmond, Virginia. Over the years, it expanded rapidly and became known for its wide selection of consumer electronics. By the 1990s, Circuit City had grown to become the second-largest consumer electronics store in the United States, with annual sales of $12 billion. With its innovative store layout and knowledgeable staff, it became a popular destination for tech enthusiasts.

2. The Collapse of Circuit City in 2009
Despite its initial success, Circuit City faced several issues and challenges that ultimately led to its collapse in 2009. Some of these challenges include:

Poor management decisions: Circuit City made several ill-advised decisions, such as firing experienced salespeople to cut costs, which resulted in a decline in customer service and satisfaction.
Failure to adapt to changing market dynamics: The rise of online retailers like Amazon posed a significant threat to Circuit City. However, the company failed to embrace e-commerce and neglected to establish a strong online presence.
Financial struggles: Circuit City faced financial difficulties due to high levels of debt and declining sales. The economic recession of 2008 further exacerbated these issues, leading to bankruptcy.
3. Challenges with Circuit City’s 2018 E-commerce Initiative
While Circuit City’s 2018 e-commerce initiative shows promise, it also faces several challenges that need to be addressed. These challenges include:

Rebuilding brand reputation: The collapse of Circuit City in 2009 tarnished its brand image. The company needs to invest in rebuilding trust and credibility among consumers.
Intense competition: The global e-commerce market is highly competitive, with giants like Amazon and Alibaba dominating the industry. Circuit City will need to find ways to differentiate itself and carve out a niche.
Technological advancements: Staying ahead in the rapidly evolving world of technology is critical for success. Circuit City must ensure it stays up-to-date with the latest trends and innovations.
4. Major Competitors in Global E-commerce
The global e-commerce market is fiercely competitive, with several major players vying for market share. Some of the key competitors include:

Amazon: As the undisputed leader in global e-commerce, Amazon offers an extensive range of products and services, unparalleled logistical capabilities, and a loyal customer base.
Alibaba: A dominant force in the Chinese e-commerce market, Alibaba has expanded its reach globally through platforms like AliExpress and Tmall. Its innovative business models and strong partnerships make it a formidable competitor.
Walmart: With its acquisition of and aggressive e-commerce strategy, Walmart has emerged as a serious contender in the global e-commerce space. Its extensive physical store network gives it an advantage in terms of fulfillment capabilities.
5. Delivering Value to the Business through IT
Information technology (IT) plays a crucial role in delivering value to the business. In the case of Circuit City’s e-commerce initiative, IT can provide value through:

Seamless website experience: IT can ensure that the e-commerce platform is user-friendly, fast, and reliable, providing customers with an exceptional online shopping experience.
Data analysis and personalization: By leveraging big data and business intelligence tools, IT can analyze customer behavior and preferences to personalize product recommendations, promotions, and marketing campaigns.
Efficient supply chain management: IT systems can optimize inventory management, order fulfillment, and logistics, ensuring timely delivery and reducing costs.
Enhanced customer service: IT solutions like chatbots and AI-powered customer support can improve response times and provide round-the-clock assistance to customers.
6. Proposed IT Infrastructure for Global E-commerce
To support Circuit City’s global e-commerce initiative, a robust IT infrastructure is essential. This infrastructure should include:

Scalable cloud-based architecture: Cloud computing allows for flexibility and scalability, enabling Circuit City to handle increasing website traffic and data storage needs.
Secure payment gateway: A reliable and secure payment gateway is crucial for protecting customer data and ensuring smooth transactions.
Mobile-responsive design: With the rise of mobile shopping, having a responsive website design that adapts seamlessly to different devices is essential.
CRM system: A well-integrated customer relationship management (CRM) system will enable Circuit City to manage customer interactions effectively.
7. Proposed IT Budget for the E-commerce Initiative
Creating a successful e-commerce initiative requires a significant investment in IT. While the exact budget will depend on various factors, including the scale of operations and desired outcomes, it is crucial to allocate sufficient resources for:

Website development and maintenance
Security measures and data protection
IT infrastructure setup and maintenance
Software licenses and subscriptions
IT talent acquisition and training
8. IT-based Risks Associated with Global E-commerce
Global e-commerce comes with inherent risks that must be managed effectively. Some IT-based risks include:

Cybersecurity threats: The risk of data breaches, hacking attempts, and other cyber threats is ever-present. Implementing robust security measures and conducting regular audits are vital.
System downtime: Any technical glitches or server failures can result in significant revenue losses. Redundancy measures and disaster recovery plans should be in place to minimize downtime.
Compliance issues: Operating globally means adhering to various regulations regarding data privacy, taxation, and consumer rights. Ensuring compliance with these regulations is crucial.
9. Leveraging Innovative Technologies for Business Value
Innovative technologies such as social media, big data, and business intelligence can provide substantial value to Circuit City’s business. Here’s how these technologies can be leveraged:

Social media: By utilizing social media platforms effectively, Circuit City can engage with customers, build brand awareness, gather insights about consumer preferences, and run targeted marketing campaigns.
Big data: Analyzing vast amounts of customer data can help Circuit City identify trends, understand buying patterns, and optimize product offerings.
Business intelligence: By using business intelligence tools, Circuit City can gain valuable insights into market trends, competitor strategies, and customer behavior. These insights can drive informed decision-making.
10. Future Technologies for Competitive Advantage
To gain a competitive advantage, Circuit City should embrace emerging technologies. Some future technologies worth considering include:

Virtual reality (VR) and augmented reality (AR): These technologies can enhance the online shopping experience by allowing customers to visualize products before purchase.
Internet of Things (IoT): IoT devices can provide real-time data on inventory levels, monitor supply chain logistics, and enable personalized marketing campaigns based on customer preferences.
Artificial intelligence (AI): AI-powered chatbots and virtual assistants can improve customer service by providing instant responses to queries or guiding customers through their purchase journey.

Circuit City’s journey from bankruptcy to relaunching as a global e-commerce multinational company is filled with challenges but also opportunities for success. By understanding its history, learning from past mistakes, leveraging innovative technologies, and investing in a robust IT infrastructure, Circuit City can position itself as a formidable player in the global e-commerce market. With careful planning and execution, this once-fallen giant has the potential to rise again.



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