February 11, 2009
Best Buy Case Analysis
Best Buy Co., Inc. has been in operations since 1966, they are based out of Minneapolis MN. They have continues to grow steadily over time through innovations. They have become customer-driven by enhancing customer enjoyment of technology. They operate over 940 retail stores across the United States and Canada. The first store in Mexico just opened up in 2009 and they are presently looking into Turkey in the near future. Best Buys current marketing goals and objectives is to serve the needs of unique customers. Best Buys four strategic initiative are customer centricity, efficient enterprise, win with service, and win in entertainment. Best Buy is achieving their goals and objectives by changing the focus of company operations, and putting the focus on customers. The new customer-centric business model was created with Best Buys strategy which is to offer an old-fashioned corner store feel for their customers under a giant technical store. In order to accomplish their strategy a major research was conducted on all of their customer’s transaction since 1996. The research showed that Best Buy had two core types of customers within the 75 million customers. Among the two types of core customers, it showed that the angel type had five types of customers. They were the small business owners, the young entertainment enthusiasts, the affluent professional, the busy suburban moms, and the tech-savvy family men. These were the new segment that Best Buy wanted to target, the angle customers. These core customers were the money spenders. In order to reach the angel demographics Best Buy converted some of stores to test the new customer-centric business model. These stores rearranged merchandise and stocked more of the types of products that would appeal to the angel customer segment. The employees were trained in both product knowledge and how to recognize an angel customers. The training that the employees received helped them to better service the angle customers with their wants and needs. Best Buy soon began to see the results from the stores that were switched to the customer-centric business model. These results showed increase in sales of 8.2 percent compared to 1.9 percent from unconverted stores. Best Buys main goal is to convert all of their existing stores to the new customer-centric business model by year end 2007.
Best Buys current marketing goals and objectives are to serve the needs of unique customers.
Global expansion into china and Canada in order to accelerate their growth in an ever growing
economy. To bring consumers and technology together in a retail environment while educating
the customers on the features and benefits of technology, entertainment, and in doing this will maximize overall company profits. Their four strategic initiatives are; customer centricity, efficient enterprise, wins with service, and wins in entertainment.
Best Buy is achieving their goals and objectives by changing their focus from being on products , to customer focus. They know that this will create a better shopping experience for the customers. This is in line with Best Buys vision statement which is to; make life fun and easy for consumers. In order for them to be ranked “best in class”, they are streamlining their company operation, and putting their focus on customers.
Best Buy plans to continue to convert more stores into the customer-centric business model and wanted to have all stores completed by year in 2007. They want to continue to add new stores to their exiting market as well as to add 90 stores in North America.
They want to grow its international business in Canada and China. Further, expand their services with Geek Squad and home installation.
Currently they have converted 300 or 40 percent of the stores to the new customer-centric business model as...