A few years ago Circuit City filed for bankruptcy. At that time, Best Buy looked to be in a very good position to control the world of electronics. Today, times have changed. Best Buy faces an uphill climb against competitors such as Walmart and Amazon. Market share continues to be impacted by price and convenience.
It’s kind of ironic that some of the strategies Best Buy is implementing aligns with the content of Apples to Apples. As a retailer, Best Buy sought to compete on more than just price. They don’t want to be the cheapest and instead focus on service as their key differentiator. After all, as I discuss in the book, culture is the brand. So upon first glance, it would be easy to discount that people are focused on price and not much else.
To be sure, price always has an influencing factor. Best Buy’s situation isn’t any different. However, did Best Buy really differentiate themselves on service? Was it exponentially better than that of Walmart’s? I would say no. For the most part, service at best is probably marginally better on a good day.
To Best Buy’s credit, I have worked with some excellent sales people. At the same time, I have also dealt with many people who are inexperienced and aren’t strong service people. The results show. While I think Best Buy wants to believe they are the best in service, it doesn’t always carry through.
Best Buy has the opportunity to regain its share as a market leader. It is going to take a stronger focus on training, sales and service. Competition isn’t going away. Apple has opened several retail locations and is now competing against someone who distributes Apple products. Compare the Apple Store’s service to that of Best Buy’s, what differences do you notice? Which one is over and above and which is just average.
Check out an article on Best Buy from Forbes: http://blogs.forbes.com/retailwire/2011/03/07/best-buy-nobody-said-it-was-going-to-be-easy/