News

Memorial Day is the traditional beginning of summer. This year, it will mark a new chapter for Klipsch Audio Technologies.

On February 13, the Indianapolis-based manufacturer announced that it would discontinue its relationships with retailer chain the Tweeter Home Entertainment Group and its subsidiaries. Klipsch will instead begin selling a limited line of its Synergy Series loudspeakers (excluding custom installation and outdoor models) at Best Buy stores across the US beginning on Memorial Day. Best Buy, headquartered in Eden Prairie, MN, is North America's number one consumer electronics retailer, with almost 1900 stores in the US, Canada, Puerto Rico, and the US Virgin Islands. Best Buy has been selling Klipsch ProMedia computer speakers for the past two years.

Klipsch will also discontinue its previous arrangement with Magnolia Hi-Fi, now a Best Buy subsidiary, acquired in December 2000. Magnolia has 16 stores in Washington, Oregon, and Northern California. The Klipsch Reference Series of loudspeakers will continue to be sold through a network of specialist dealers nationwide, the announcement stated. Those dealers, Denver's upscale Ultimate Electronics stores, and West Coast retailer Good Guys have been designated Klipsch "flagship" retailers, according to chairman Fred Klipsch.

Klipsch Reference Series and Synergy Series loudspeakers will be managed by separate product development and engineering teams, as is done by Harman International with its Revel, Infinity, and JBL lines. Paul Jacobs, chief operating officer of the Klipsch Worldwide Products Group, said this two-line strategy would allow Klipsch to "focus distinct products towards uniquely different retail selling environments," and that the internal separation would guarantee continued delineation between the product lines.

Upscale retailers have done very well with the company's Reference Series, Jacobs noted, with "marked increases in sales . . . . This distribution realignment builds on the success of that full-line strategy and creates a consistent brand story in every market with our Reference Series."

"The specialty retail landscape has undergone radical change due to aggressive retail acquisition and consolidation," Fred Klipsch stated. "We are moving forward with a strategic realignment that eliminates regional conflicts and creates order in our core business of specialty retail distribution with the Klipsch Reference Series. At the same time, we will broaden our market penetration and brand exposure through Best Buy with the Klipsch Synergy Series." Klipsch is one of the oldest American audio manufacturers in continuous operation, making loudspeakers for residential, commercial, professional cinema, and multimedia applications under the company name, and high-end amplifiers, preamplifiers, and processors under the Aragon brand name.