Something strange is happening at JB Hi-Fi.
Something strange is happening at JB Hi-Fi.
The Australian chain's New Zealand arm was struggling. Now, it's about to open 20 new stores. How?
Mums huddled around gleaming widescreen TVs and projectors, discussing the pros and cons of sizes, brands, and the differences between OLED and QLED screens.
Dads skulked through the hi-fi department examining speakers and subwoofers, small black boxes that might help them make their home theatre dreams come true.
Teens packed into the gaming aisles, gleefully placing their grubby fingerprints all over new Xbox and Playstation titles like FC24 and Spider-Man 2.
Portable speakers, gaming accessories and blu-ray movies were being whisked off shelves and rushed up to the counter in a last-minute rush before Christmas.
But it was in the music section where the real frenzy was taking place.
On December 24, at JB Hi-Fi’s brand new South City store in the centre of Christchurch, Santa had showed up early and extended an olive branch.
The Australian retail brand – now the world’s seventh largest tech retailer – took a punt and began Boxing Day sales two days early, offering 20% off every single record it had on its shelves to last-minute Christmas Eve shoppers.
Word had clearly spread: the aisles around the store’s vinyl bins were packed like I’d never seen before.
People flicked through tubs, pulled out records and tucked them safely under their arms before anyone else could nab them.
“We can’t keep up … we’re struggling to get stock,” a sweaty and slightly frazzled staff member told me two days later.
I’d returned to see if the buying frenzy had continued. It had. In fact, Boxing Day was even busier than Christmas Eve.
Wow.
I thought no one was buying physical media anymore.
I thought everyone was buying their stuff online now anyway.
I hadn’t seen an in-person retail frenzy like it in years.
And yet, when I called JB Hi-Fi’s managing director Tim Edwards to discuss this, he wasn’t surprised at all.
“It’s coming together really nicely for us,” he told me.
Then he said something baffling, something incredible, a fact that blew my tiny little mind wide open.
“We haven't announced the actual number yet,” said Edwards, “but [we’re opening] well over 20 more stores.”
What?!
Twenty?!
That would more than double the number of JB Hi-Fi stores in Aotearoa.
In what world could this possibly be happening?
‘We’re getting smashed … we can’t keep up with demand.’
Vinyl.
The answer’s vinyl.
One of the main reasons for JB Hi-Fi’s growth can be found right there in its vinyl bins.
“Vinyl by far is – pardon the pun – the hit,” Edwards told me when I called him after a steamy January day back at work.
“We’re getting smashed. At this point in time, we can’t keep up with demand. It’s awesome … it’s a great problem.”
It’s true. While sales of other physical media – like video games, DVDs and blu-rays – decline, vinyl is continuing its resurgence, a once-defunct medium now entering its retro-cool phase (especially with the kids).
In Australia, it’s helped turn JB Hi-Fi into a juggernaut, a tech retail success story that racked up record (ha) revenue of $9.63 billion – yes, billion – in 2023.
In New Zealand, Edwards admits the brand has been “in hibernation”.
Up until South City’s opening in November, it had moved two stores – in Auckland and Hamilton – but hadn’t opened a new branch in eight years.
“We were underperforming to potential here,” says Edwards, who left Noel Leeming 18 months ago to head up JB Hi-Fi’s New Zealand arm.
So he got to work on expansion plans, trying to make the most of what he believes the chain store does differently.
“Consumer electronics … has become pretty batshit boring,” he says. “JB HiFi is the total opposite of that.”
So, under Edwards, JB Hi-Fi’s stores are intentionally trying to resurrect some of that old school record store vibe.
Staff are young, friendly, welcoming – and opinionated. They post frequently on social media about new stock, store openings and specials.
A free quarterly magazine called The JB Hi-Fi Guide to Essential Vinyl, full of vinyl recommendations and reviews, is curated by veteran music critic Graham Reid.
When a new store opens, a members-only after-hours event is held with discounts and bands. Jon Toogood performed at The Base, and Drax Project were in the house at South City, where more than 2000 people queued up outside waiting for the doors to open.
JB Hi-Fi also offers some of the cheapest vinyl prices on the market.
“Our prices are super sharp because we've got a very low operating cost model and we've got high volume,” says Edwards. “So we've got the buying power. You combine those two [things and] we pass it on to our customers.”
(I asked Real Groovy owner Chris Hart about the threat JB Hi-Fi’s expansion might pose to a store like his, and he responded: “We don't pay much attention to what our competitors do.” But he did say there were benefits: “The more records that get sold, the more there are to be traded in, so we're happy to see the market grow.”)
So people come to JB Hi-Fi to flick through the vinyl, and while they’re there they might pick up a new iPhone, or browse through the laptops, tablets, TVs, stereos, portable speakers or watches.
It seems to be working. Edwards says most tech retailers enjoy about three visits per year from each customer. At JB Hi-Fi, that number is 10.
Now, the chain’s expansion plans are well underway. It’s doubling its number of stores, from 19 to more than 40. Already, two have opened in the duty free sections of Auckland and Christchurch International Airports. Last week, Invercargill opened its first store, and Pukekohe is next. “There’s a ton more planned,” says Edwards.
He sounds like a happy man. He is. “We’re loving it. We’re [one of] the last major retailers standing with music and movies … We’re definitely on the march.”
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Oh don't get me wrong, our teen was also checking out the gaming section. But they have EB Games for that already. I think JB HIFI will do well in Invers, as it's in the mall so everyone will go past it when they're in town, whereas the other electronics stores here are slightly out of the way so you have to make a decision to go there. Also, I should clarify, the teen does NOT have a turntable! But knows that vinyl is cool and is thinking of buying one. So it's sort of a pre-browsing.
We went to the Invercargill store's opening and it was so packed we fled, and came back on a less busy day. It's the only place in Invercargill you can buy blu-rays, DVDs, CDs, vinyl, etc. So our teen is happily browsing the vinyl while the parents are browsing the blu-rays.