After opening a total of 1,500 locations within larger Target locations and giving Target an entry point into postpaid mobile sales, RadioShack has announced that Target Mobile will be no more as of April 8th. The idea behind Target Mobile was that RadioShack would open dedicated storefronts within Target locations that primarily sold postpaid wireless service from RadioShack’s stable of offerings, complete with dedicated employees and services.
In practice, the idea worked about as well as one would expect, with unremarkable service and many Target customers confused by the branding, as the stores were not directly operated by Target, which led to plenty of confusion on certain policies as well as confusion about who handled specific processes. This also recalls the R Solutions business operated by Radio Shack and Sprint before dramatically scaling back starting in 2010 due to the struggling economy.
With the 1500 locations being decommissioned later this year, this means Target will lose the opportunity to sell postpaid service via its weekly flyers, but will otherwise return to its previous sales focus of selling increasingly popular prepaid service and more profitable accessories, as its sales volume on postpaid never matched its closest competitor in Walmart, while both Target and Radio Shack had been locked in negotiations to renew the agreement as far back as October of last year, according to Radio Shack’s statement.
However, it seems that the only people happy with this move are Radio Shack investors, as Radio Shack’s typically moribund stock price has jumped on the news that the arrangement would end. Target has yet to confirm whether it will continue selling postpaid mobile services after the Target Mobile venture ends under its own control or whether it will investigate another postpaid sales partnership with another company.
Update: Target has confirmed that it will continue offering postpaid sales via new agreements with Brightstar and MarketSource while offering Target Mobile employees the opportunity to remain with the new partners or move with RadioShack.