After reporting an 8% decrease in sales over the Christmas period -- usually the chains most successful time of year -- HMV have announced a number of changes to the business.

Lacking sales of physical products such as DVDs has been attributed to recent layout changes in stores, with a quarter of floor space now assigned exclusively to technology products. However, sales in headphones, speakers and tablets have increased by 137%. Now Universal have joined forces with the retailer to combat flagging sales by taking a 2.5% stake in the company. The deal with the supplier means HMV's debt of £180 million can be halved over three years

In January, Chief Executive Simon Fox stated: "He adds: “The new relationship with our suppliers and the support of our banks will now enable HMV to wholeheartedly focus all of its energies - working in close partnership with its suppliers, on serving the changing needs of its customers ever more effectively."

Since the deal, HMV has created a new senior role in order to increase sales and refocus their branding. Former Asda marketer Paul Stevens has taken on the position of Head of Insight and Ecommerce, reporting to Marketing and Ecommerce Director Mark Hodgkinson.

HMV have also restructured marketing focus to give equal attention to online and offline branding in an attempt to offer what online businesses such as Amazon cannot. The marketing team are responsible for "bringing the brand and products to live" through in-store events and added value experiences to potentially draw customers away from computer screens and back in to stores.

Hodginkson has commented: “We shouldn’t just think about our stores and physical products … and the concept of the physical in decline and digital growing and treating them as separate businesses - its about running online and offline together and customers being able to interchange easily.”

Fox has stated changes are “beginning to show through” and added:

“As a key part of this we remain committed to improving our specialist ranging and merchandising of music and DVD whilst also continuing to grow our sales in portable technology and further developing our online and digital offers.”

It is thought recent deals with Universal and backing from banks will secure HMV's future as the remaining major entertainment retailer, though flagging sales show the business must be successful in offering attractive services online retailers cannot provide.
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