Reputation Survey: HMV - Online threat to the future of HMV

The CD, DVD and computer games retailer has secured its short-term existence with a £220m refinance package, but the public does not expect HMV to survive for much longer.

HMV may have secured financial backing to keep it afloat, but the public is pessimistic about the future for the high street CD, DVD and games retailer, particularly when compared with online rivals.

Britain's last nationwide music chain, which employs about 8,000 staff, has been thrown a lifeline by banks that should ensure its survival for several years.

The banks have left the refinanced business facing years of punishing debt repayments before it can return to full health. And if that were not bad enough, in PRWeek and OnePoll's latest survey, HMV lost out time and time again to the world of online CD, DVD and game sales - most typically to main rival Amazon.

HMV is not only losing to Amazon as the outlet where respondents bought the majority of their music - 34 per cent, compared with HMV's nine per cent - but also to iTunes (18 per cent), supermarkets (11 per cent) and other online retailers (11 per cent). Consumers expect this trend to continue.

Twenty-two per cent of respondents rated HMV as having the best customer service, compared with 17 for supermarkets and seven per cent for other high street retailers, but HMV took a distant second place to Amazon on having the best range of products (58 per cent compared with 16 per cent).

The damning verdict on HMV's future is that 50 per cent of consumers do not think HMV will survive in the face of online-only retailers and supermarkets.

HOW I SEE IT - DAVE BENNETT, COMMS DIRECTOR, EXPOSURE

Poor HMV, and all hail the mighty Amazon. It seems price plus selection, plus customer service, coupled with the familiarity of physical media, is still the winning formula for media sales.

The digital utopia, with its instant gratification and endless choice, is still a way off. Shiny discs are still where it is at for millions of consumers, despite the efforts of brands such as Apple and Microsoft to persuade otherwise.

New services such as iCloud and early adopter favourites such as Spotify hold much promise, but there's lots of scepticism and lack of interest to be addressed before we will be giving up our Take That CDs and Mad Men box sets for good.

We will get there eventually, but for HMV it is game over - limited selections, high prices and stores with an unpleasant trapped-in-the-90s look and feel have seen to that.

A cautionary tale and one that Amazon should pay close attention to as digital delivery does eventually take off.

A YEAR AHEAD - 93% said they did not expect to buy the majority of their music from HMV in a year's time

HMV SALES - 91% said they did not purchase the majority of their music from HMV

SURVIVAL PROSPECTS - 50% of respondents said HMV would not survive in the face of online-only retailers and supermarkets

AMAZON PREFERRED - 34% said they purchased the majority of their music from Amazon

HOW OFTEN DO YOU ...
visit HMV's high street stores?
More than once a week: 2
Once a week: 8
Once a month: 17
Less than once a month: 73

HOW OFTEN DO YOU ...
buy CDs/DVDs?
More than once a week: 2
Once a week: 8.5
Once a month: 28
Less than once a month: 61.5

HOW OFTEN DO YOU ...
listen to the radio?
More than once a week: 57
Once a week: 25.5
Once a month: 6.5
Less than once a month: 11

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