What can any retailer learn from this case?
According to this case, and concerning about the strategy that Best Buy has created, retailers can similarly create a retailer-led product strategy to leverage their customer knowledge for product differentiation and to understand what the needs of the customers are; they must discover what satisfies the customer and what not. In addition, the retailer can seek for news partnerships, new stores, new countries and new categories and services in order to increase their net sales and their share market. It’s very important invest in marketing study aiming to discover what the other companies are doing. Besides, with the time, the smaller retailer can increase significantly even more than the bigger companies as Best Buy. 2.
Analyse the data in Tables 1 and 2. What conclusions do you reach? Table 1
Trying to explain the consumer behaviour, after a good period of consumer spending between 1993 and 1995, and up and downs between 1996 and 2006, there was an increased 4.0 percent in 2007, a severe slowdown compared with the strong gains in prior years. In the following year, the increase was only 3.4 percent how it was expected, due the weaker computer spending growth. The next year the result was not too much better (4.0 percent increase). The growth should pick up again in 2010 to 6.1 percent before the narrow growth in the final two years of the forecast period but remain sleep. The prices have trended downward from the beginning in the consumer electronics and computer categories. It means that the expending on consumer electronics is due not only for the price, depend also of the marketing strategy and the incomes that the consumer could have. Table 2
Best Buy, Wal-Mart, Circuit City, Target and Dell were the largest U.S. sellers of consumer electronics between 2003 and 2007. Both Circuit City and Dell lost market share, while Best Buy, Wal-Mart and Target increased Market Share. The situation continued to go quite badly through 2008 for Circuit City, so much so that it went out of business in 2009. This table, show the Best Buy strategy as the best to gain land in the market share’s field. If this company continue applying this scheme and investing in marketing study, they could remain leading the market, even with strong competitor as Wal-Mart and Circuit City. 3.
Why has Best Buy been able to weather the recent economic downturn better than many other retailers? Best Buy has created the strategy of sell products developed by others but branded as their own; the company has also done something different in order to differentiate itself in the market. First, it leveraged its deep knowledge of consumers to understand what consumer needs were unmet in the market. Second, it move toward PC OEMs (it means the component is intended to be sold as part of a complete system instead of as an individual component) to develop a unique line of laptops to meet consumers specifications. Third, it includes the laptops with extended warranties, antivirus protection, and/or Geek Squad service. Finally, it created its own category brand for these laptops ("You Spoke. We Listened.") that transmit relevance and simplifies the buying process, yet it is dependent of the OEMs' own brands to transmit quality and reliability. With this kind of product, Best Buy uses its unique relationship with customers to create product differentiation, thereby giving solutions to its customers. 4.
Does Best Buy do a good job with regard to the retailing concept? Explain your answer. Form my outlook; Best Buy has done a good job regarding the retail conception of the last years related with their competitors. Its current retail model is to be the one stop shop for a customer's electronic needs, irrespective of demographic differences. Nonetheless nowadays, the company has been some threats concerning the market; therefore, the store needs to stock most price points, brands, and categories. This strategy...
Please join StudyMode to read the full document