Can the Maker Movement Save RadioShack?

RadioShack is hoping LEDs and robotics enthusiasts can jump-start its ailing business.

RadioShack is truly a relic of an earlier electronic age--the word "radio" eclipsed only, in outdatedness and unattractiveness, by the word "shack." The nerd electronics chain has been the butt of retail jokes for years; the Onion jested back in 2007, "Even CEO Can't Figure Out How RadioShack Still in Business."

It seems RadioShack can't win for losing. They hired a hotshot CEO and paid him over $20 million; his big idea was changing the store's name to The Shack. Then the company tried selling iPhones--and did indeed sell a bunch of them--but the margin on Apple products was so small that their overall sales receipts plummeted, losses rose, dividend was suspended and Fitch downgraded their debt to CCC (There is no F in the Fitch scale). In the most recent quarter ending in April, total RadioShack revenues were down again--by $65 million.

But there is a single, bright spark in the gloom. RadioShack now finds itself closely tied to one of the most disruptive and exciting new trends in the entire economy: the Maker movement, in which tens of thousands of hobbyists make supercool projects using robotics, microcontrollers, and 3-D printing.

Last week at the Maker Faire in the Bay Area, RadioShack launched a cobranded product line with Make magazine/Maker Faire. The line includes LEDs, robotics kits for kids, microcontrollers with Wi-Fi, a line of mini-PCs, and tools. All of these items will be sold exclusively through RadioShack stores and by Make online.

This is the first major cobranded product line for Make and the first Make line to be found in thousands of physical retail stores. "Adding to the popular Make line of kits, like 'Getting Started with Arduino,' the new cobranded product lineup from Maker Media and RadioShack combine Maker Media's strength in cultivating and growing the maker movement with RadioShack's strong retail footprint and DIY heritage," Dale Dougherty, founder and CEO of Maker Media, said at the launch.

Last year, RadioShack started stocking Arduino, the wildly popular Italian line of open-source electronics, and has had a presence at Maker Faires on both coasts for several years. In some ways, it's a natural alliance. RadioShack has a history of innovation in retail, selling the first consumer personal computer in 1977, and it is among the earliest cell phone retailers. The company is now allying itself with a disruptive force that some foresee overtaking the entire consumer economy, replacing generic items made in China with mass, home-designed, DIY, hyperlocal, and customizable products.

But that future is at least a couple of years away. Is the Maker movement and its cachet big enough to bring RadioShack's struggling business with it? That's a pretty big project.

[Image: Flickr user Jen Dodd]

Add New Comment

6 Comments

  • joy2b

    It'll only help if they actually stock useful parts, and stop the gamut of salespeople.  I've started to suspect that no one on the management team there is actually interested in tinkering, or browsing parts looking for a new project.  
    Changing the name made sense.  Radio shack isn't welcoming to people considering building a ham radio anymore.  They'll sell you a walky talky though.

  • Stephan Williams

    They need to do their research and start carrying parts that people actually need in crunch time. Resistors and single color LEDs are all fine and dandy, but I go to Radio Shack when I need a component STAT and can't wait for an online order. So here's my "life-saving" advice to you Radio Shack: stock weird parts, not just the everyday ones.

  • Paranormal Skeptic

    I do think the makers will keep RS afloat, and make it a successful company, once again.  It started with the makers, lulled when we got sold a bill of goods that we don't make things, we just have China make things; and now it's coming back home.

    Will it take a couple-few years?  Sure.  It wont happen next quarter, or next FY.

  • Horst

    RadioShack MUST change their name. Reference to "Radio" is so outdated, no amount of money, ad campaigns, etc. will keep them alive.

  • William Klingensmith

    Changing the name is a mistake; because name recognition is valuable.  The fact that "Radio" is outdated helps them.  Because now when people say "Radio" they only think of Radio shack.  Since Radio Shack is the only thing that is not totally outdated.

    As for the strategy; Radio Shack has a long way to go.  

    They need to adapt.  

    They just need to drop the TV sales all together.  

    They have failed to move into the computer business.  They have never had any decent selection. 

    They have failed to move into the tablet's.

    They moved into the cell phones and that kept them afloat.

    They need to be ready to drop Dish/Direct TV on a moments notice.  Since those 2 products are fading out and going away.

    Radio shack has fallen short of what it once was.  It used to be the "answer place"  However; with today's technology people don't need answers.  This is why it is failing.  

    The thing is that people still need electronic parts.  To fix Radio Shack they need to incorporate You Tube and training.  Much like Home Depot does.  They need to educate people how to save money by fixing electronics themselves.  

    If Radio Shack started to invest in teaching its customers more, and answered the hard how to fix it questions in store.

    Sure we all can use You Tube and learn how to do something, but if we have any questions there is no one to ask.  Or we have to search for it online and watch yet another video.

    To fix Radio Shack they need to combine with new emerging technologies and show people why they are still relevant.  They need to offer free training.  Work with kids more to show them how to do electronics.  

    Radio Shack needs to show people why they are needed.  There expertise has moved from electronics to products.  People no longer need product expertise.  
    People need human interaction that can mix with today's technology; leading to being more educated and involved in fixing our own electronic components.

    People get elected to politics on names. Radio Shack is still a house hold name; even if it is a joke at times. This is what is saving their company. Removing that name only removes potential customers and future sales.

  • Anya Kamenetz

    I like the idea of RadioShack doubling down on educating consumers. That is exactly what the Maker movement is all about. They seem to be trying to do a version of that with this website: radioshackdiy.com