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A Nemo blog. Dealing with uncommon cents.

The six remaining Virgin Megastores in the U.S. including the Times Square location (probably the single highest volume music store in America) will be closing for good over the next few months, leaving 1,000 people unemployed.

At its peak in 2002, Virgin had 23 stores across the U.S. with $230 million in sales. Virgin’s billionaire founder, Richard Branson sold off the retail chain years ago and it is currently owned by a joint venture of real estate companies. Though CD sales are down (they fell by a staggering 20% between 2007 and 2008), the stores are being liquidated because their owners think that they can make way more money off of the sale of the property than CD sales.

And, what will be taking over the prime Times Square real estate? None other than the cheap chic apparel chain, Forever 21. The shuttering of these six stores really does signal the end of an era. The brick and mortar music retailers as we once knew them are nearly dead.

Conspicuous consumption has drifted away as consumers shift their incomes to necessities in these dreary economic times. Overall, U.S. retailers are reporting that January 2009 sales are down 9.5% when compared with the same period the year before.

All the same, it seems that we haven’t completely given up on shopping altogether. Forbes.com is reporting that there are 10 key stores that Americans can’t live without.

Notably, the list includes Urban Outfitters. For the most part, 20-something hipsters will find a way to shop no matter what and Urban has a unique edge by not mimicking every other mall chain store. Each location boasts a product mix that is often tailored towards regional trends. Sales have increased 22.8% over the last year.

On the luxury front, Hermes (where handbags can retail for upwards of $5,000) isn’t for everyone’s budget. Though to Hermes credit, it is known for quality, timeless designs. Many who can afford the price points would rather invest in one quality piece that will last for years instead of a handful of lower-priced, trendier items from brands like Coach (which is doing terribly).

On the electronics front, Amazon.com has held up well. The massive selection, free shipping and low prices have all contributed to its success. Amazon has prospered partly because they were smart in the beginning and built a sense of community with customer reviews and pushed the Site Recommendation Tool (which recommends items based on customer’s past purchases).

Other flourishing retailers include American Apparel (now the largest apparel manufacturer in the U.S.), Walmart and J. Crew (thanks to the free publicity via the Obamas).

The secret to these retailer’s continuing success relies heavily on differentiation, whether it be through service, product offerings, price points or ease of use. Additionally, many (namely Urban, American Apparel and Hermes) continue to offer items that consumers can’t get at every other chain store. Getting consumers to part with their hard earned money right now means offering a unique experience that they can’t get anywhere else.