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It was probably coming, what with the news that its San Francisco and New York outposts would be closing over the next few months breaking recently, but the announcement that the remaining scraps of the Virgin Megastore chain will be euthanized in the coming months still made me kinda sad. The company will close its remaining stores in Denver, Orlando (Fla.), and Los Angeles over the next few months, and the assets of Virgin Entertainment Group North America (VEGNA) will be liquidated this summer. You may be surprised to learn, however, that the complete shutdown of the chain wasn’t a certainty when it was jointly purchased by the New York City real estate giants Vornado and Related—which owned the below-market-rent leases on the Times Square and Union Square outlets, respectively—a few months back. No, really!
While it now looks like Virgin was always destined to lose its Times Square space-Virgin pays $54 a square foot in rent there, according to press reports, while the market price for that location currently is in the $400-$500 per-square-foot range, according to Prudential Douglas Elliman Real Estate Chairman Faith Hope Consolo – the company still had a chance to continue, Virgin Entertainment Group North America CEO Simon Wright says.
For a while there was talk of moving Virgin to the empty space next door where Barcode closed down years ago-until the economy went south. VEGNA had successfully re-merchandised its Times Square store into a lifestyle experience where clothing and portable electronics were more of a factor in the store’s profitability, while using music as a draw-in factor.
But the company was also working on improving its concept for a smaller space. With CD sales sliding, “I tried my hardest to come up with a new model, and we were making a lot of headway with it before the holidays,” says Wright. But, the “economy is so bad; it’s all about batten down the hatches.”
The Barcode space, by the way, was recently used as a gigantic public restroom.
The “smaller stores” strategy wasn”t the first time that Virgin thought about reworking its model for its stores in the US; while searching for pictures to accompany this story, I found an AP article on former chairman Richard Branson’s attempts to revitalize the brand back in 2003:
“We used to be the best music store in town – the best range of music. But music has declined,” Branson told The Associated Press in an interview at the San Francisco Virgin Megastore.
“It may decline a little bit more,” Branson said. “What we realized was it’s because young people of this generation, they’re spending money on mobile phones. They’re spending money on clothes. They’re spending money on electronics. … Quite a few items which the previous generation, they weren’t doing. They were just buying music.” …
The new vending machines will be stocked with the latest music and movie releases, and will dispense titles on the spot, just like canned soda.
And there will be a selection of erotic media that includes books and DVDs.
Branson and other music retailers face a glut of new competition for music consumers. Online shops such as Apple’s iTunes Music Store and the relaunched Napster are vying for customer dollars alongside brick-and-mortar stores like Virgin.
The National Association of Recording Merchandisers, citing a survey of its members and Neilsen SoundScan data, claims there were about 28,500 music retailers in the United States in early 2002. About 1,500 shut down, NARM reports. The figures do not include mass merchants or chain electronics stores.
“We’ve been through some very tough times the last couple of years,” said Glen Ward, CEO of Virgin Entertainment Group for North America. “I’m encouraged that the last two to three months the market seems to be pulling itself together. There’s some good music out there. The economy seems to be lifting.”
Ah, 2003. You were so innocent, except for the whole “adding porn to stores’ shelves as a means of survival” thing.
Remaining Virgin Megastores To Close, VEGNA To Liquidate [Billboard]
Sigh. These stores were major formative experiences for me, true “happy place” spaces during my years at NYU. (For example: if there was a fire drill at my dorm, I’d always just walk over to Virgin or Tower instead of standing around outside.) All my favorite imports, all my treasured singles and b-sides, came from Virgin. Walking the aisles with my boyfriend at Christmastime, noting down everything he picked up in my memory. And oh, the $10 album sales.
Just another way in which the world is telling me I’m already a dinosaur in my mid-twenties, I guess.
@Lucas Jensen: there used to be one on long island!
And what about the Virgin megastores worldwide?
I mean: I have very very good memories from the one at Champs Elysees…
Sad. Continued decline of music-as-culture to music-as-download. What are we left with now (FYE doesn’t fucking count) – probably a dozen or so truly world-class independents, many of them struggling, and another couple of dozen second-tier shops? In many cities I’ve been to recently it’s actually impossible to buy music outside of the Best Buy/Target construct.
I hate to be all pissy and old and cling to my vinyl but this is less about mp3 vs. CD and more about the staggering insignificance of music in the life of the average teenager or twentysomething – it’s just another media consumable. It used to mean _everything_.
@Bong14: i was actually trying to figure out how much the number had declined from the 28,500-in-2002 figure cited in the story i quoted above.
@K-milo: it’s a separate business. in the uk the virgin megastore brand was converted to zavvi, which went into administration (the uk term for bankruptcy) and was just bought by an online retailer called the hut group:
[www.ft.com]
@Maura Johnston: 19 of the Zavvi stores have been bought by HMV and will be rebranded as such: [www.zavvi-info.co.uk]
@dyfl: agreed.
I think it’s a cop out.
@Lucas Jensen: I’m fortunate enough to live near a dozen indie record shops but it’s a little sad for me to see the giants sink. My local, now-defunct Virgin introduced my teenage self to a lot of esoteric music and magazines (anybody remember Mondo 2000 magazine?) back in the 90’s. Last night, I visited two Circuit Cities during the last week of their house fire sales and those shops were pretty much barren. I bought my first CD player at a Circuit City 16 years ago.
Not a surprise that this is happening, and even less of a surprise that Virgin didn’t go with the ’smaller store’ idea. The only brick and mortar music retailer I can think of that is doing well is Amoeba, and they survive by their very big-ness and sensory overload-osity. That was the Virgin plan as well, but I bet their much more expensive real estate (other than in Times Square) was hurting them. Amoeba stayed focused on music (and movies) without all the clothing and electonics and porn which has made Amoeba a destination for music-heads. I completely forgot about the Virgin store, which is less than a mile from the Hollywood Amoeba, when I posted on this topic a while back. Amoeba and Virgin are both tourist spots – but the ones at Amoeba are fans of music who seek out the store while Virgin is the spot people wander into after they get their photo taken with the guy dressed like Spiderman on Hollywood Boulevard. Amoeba seems likely to last because it speaks to the true-believers while Virgin had transformed into Planet Hollywood without burgers.
@30f: Ameoba mainly gets by on enormous amounts of used CDs and records, as well as having a reputation for being a go-to spot for music junkies.
vin diesel once walked into a virgin megastore. when he left, it was just a megastore.
@30f:
Does anyone remember the Virgin in Burbank? I used to go there every week because they had a great selection of hard-to-find imports at pretty decent prices. And then I guess the roof caved in (literally) during a particularly harsh storm and they closed it down. When they reopened in Hollywood a couple of years later I made the trip once, but it’s really inconvenient. Who the hell wants to deal with Hollywood Blvd. and all the tourists and crazies?
So sad, though. Thank god the Rhino Records in Claremont is still alive!
To people from big cities, these (and Tower before it) are a big deal. They never really affected me in any way, so it’s hard for me to feign sadness. I always found them overpriced (when were these $10 sales?!) and uncomfortable. The myriad indie stores I love and have loved over the years, in places like Starkville, MS, Auburn, AL, and here in Athens, GA, will be the real losses to me if they go (and many have already gone). Not saying this isn’t a big deal…I just have no relation to the story having never lived in a city with a population over 100k!
Sad to see record stores go, though, in any form. I hate to see consumer options and jobs disappear.
Damn, Tower used to be my home away from home when I was waiting for class at NYU. Now Virgin Times Square is the only thing good about the fact that I work in Times Square, the only refuge in the area left. No more new music Tuesdays I guess.
Oh well, at least Apple & AT&T saw fit to let me download music over 3G. Funny how all those hours of sampling music at Tower and Virgin are now available any time I want all through my tiny phone. Guess that’s one reason why Virgin is closing…
And their liquidation prices are a joke. At least Circuit City offered 10% off PS3s. Virgin is doing 5%, not even gonna cover tax.
So does this put an end to the midnight release day. After Tower there was only Virgin, what will I have to do now wait till the store opens in the morning??? Or even worse…..iTunes?!????! Sigh, yo.
That was my favorite place to buy good music CD’s but I’ll
visit Virgin Megastore one last time this spring before they close. I’ll miss you Virgin Megastore and Thanks for
the memories!
If I recall correctly, the Union Square Megastore opened in in ‘99; at the time, the 4th/B’way Tower was averaging $100K/day in sales. Ten years later, both gone. Damn.
Dreamin. I love blogging.Focus on your blog it is great.
the 3 dislikes were clearly looking for clips from the groundbreaking 90’s movie with will smith…