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Category Killers

The term “Category Killer” refers to a type of specialty retailer or chain of stores that is so big that it “kills” the category for most other competitors (of all sizes). Most of these establishments also qualify as “big box stores.” These stores exist in all communities, in both urban and suburban environments. Nearly all of these stores also sell products over the Internet.

Electronics giant Best Buy now has virtually no national competition, to give a prime example of a retail category killer. The huge home and building centers The Home Depot and Lowe’s have put many small hardware stores, as well as large regional home centers and lumberyards, out of business. Local toy stores only survive if they are at a significant distant from giant Toys “R” Us. The same is true for bookstores in the face of the giant chain Barnes and Noble. Other prime examples include PetSmart and Petco for pet products, Bed Bath & Beyond for linens and home products, AutoZone for automobile parts, Sports Authority and Dick’s for sporting goods, Office Depot, OfficeMax and Staples for office supplies, and Whole Food Markets for health foods.

Not every category killer is a big box store, however. On the Internet, eBay has a virtual monopoly in the auction business, while dominates the online book market.

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