Best Buy
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Transcript of Best Buy
![Page 1: Best Buy](https://reader036.fdocuments.us/reader036/viewer/2022081605/587a7a341a28abf0468b5d11/html5/thumbnails/1.jpg)
MARKETING CASE STUDY
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Expert Service.Unbeatable Price.
Subsidiaries :Geek Squad, Pacific Sales, Magnolia, Future Shop
Headquarters: Minnesota, United States
World’s Largest Consumer Electronics Retailer
Revenue : $42 billion
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1477 Retail stores worldwide!!!
V
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Powerful market position through
expansion
Salaries to commissioned sales people
Biggest seller of
home PCs
Relaxed shopping environm
ent
Introduced new store
concept
in 1983-1990’s
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New Challenges
…
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Increase in competition
Showrooming
Shift in consumers
interest
Dipping sales due to single channel
strategy Emergence of online
retailers
in 2000’s
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No store
High
Varie
ty o
f ele
ctro
nic
ite
ms
offe
red
LowSize of store Large store
AmazoneBayNetflix
GameStopMagnoliaRadioShack
CompUSAFry’s
TARGETWal-MartCostco
The
Co
mpe
titi
on
Zon
e
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Points-of-Difference
Strategies adopted by Best Buy to gain competitive advantage over other brands
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Hired knowledgeable sales people to attend tech –savvy customers
Provided shopping assistants to help mom shoppers
Trained employees to give information about discounts and new
offers to influence price conscious people CUST
OMER
SEG
MEN
TATI
ON
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STILL! The company struggled…
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Hubert Joly – The CEO-man arrives…
in 2013
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New Strategies
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The revamped format is called the “Connected Store.”
Introduced a central runway to showcase the latest technologies.
Additional space to profitable products like smart phones, iPads.
Moved the declining categories to back end- TVs , CDs, DVDs, entertainment devices.
L Large touch screens to search for in-store product availability and conduct side-by-side product comparisons.
1. O
ptim
ized
lay
out
of s
tore
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Decrease in Large stores
Increase in Small mobile stores
2. TRANSFORMATION
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Drive cost reduction and Efficiency
Lower transportation costs Better use of labor Lower markdowns
Build strong industry position and Multi-channel sources
Blue Assist- allows customers to shake their device to get live help through chat, email
Increased product line in home emerging categories Reduced wait time for customers
Advanced key initiatives to drive future growthEducational sales approach to make people aware about latest technologies
Investment in Internet of Things Better post purchase support
3. R
ENEW
B
LUE
201
6
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Geek Squad hires certified technicians called ‘agents’ to provide solutions to customer problems.
Geek Squad is a subsidiary of Best Buy and its precincts exist in all stores..
Geek Squad provides technological services - In-store On-site emergency
support Over Internet 24-hour telephone
service
4.
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Improved customer help
Shipping option
Geek Squad Support
Rating
Easy tools for comparing prices
Nearest store
locator
Open-box Item at lower
prices
features
Membership cards
5. www.bestbuy.com
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6. Best Buy App
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More recyclable packaging
Purchase of green-
power
Collection of consumer electronics
and e-waste
Proper disposal of electronic
components
7. E
nvir
onm
enta
l C
once
rns
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SWOT Analysis
STRENGTHS STRENGTHS
• Largest brick and mortar electronics retailer.
• Focus on customer service and support.
• Offers latest electronic items through multiple channels.
WEAKNESS
• Huge maintenance and costs. involved in maintaining large stores
• Dependence on third-party vendors.• Declining profit margin in unpopular
product categories
OPPORTUNITIES
• Expanding global presence.• Investment in latest technology.• New marketing and communication
channels to reach customers.
THREATS
• Intense Competition.• Showrooming.• Manufacturer’s direct engagement
with customers.
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RECAP
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Created by Avani Jain, NIT Raipur, during a marketing internship under Prof. Sameer Mathur, IIM Lucknow
Sameer Mathur
Indian Institute of Management,Lucknow
DISCLAIMER