Best Buy Planning Radical Store Remodel: Report
By Alan Wolf -- TWICE, 6/16/2009
Minneapolis — Best Buy is planning to radically alter its store layout to emphasize services and test new product categories.
According to Credit Suisse retail analyst Gary Balter, Best Buy will move its Geek Squad stations to the center of the sales floor and surround them with room vignettes that demonstrate the capabilities of converged products.
The new store model could also accommodate new product categories that are currently being tested, including exercise equipment, musical instruments and possibly used videos, Balter wrote in a research note based on discussions with management.
The company is also re-evaluating its current space allocations, he said.
The new store design underscores Best Buy’s intention to emphasize service- and subscription-based revenue, Balter noted, as reflected in its recent investments in Napster and a venture fund called Fuse that will bankroll the development of digital content applications.
“We have become a service business that has retail stores, not a retailer that provides service,” he quoted Bob Willett, CEO of Best Buy International and former chief information officer.
Making the company an "enabler of connected digital solutions" through its Geek Squad and Best Buy Mobile platforms was one of four strategic priorities cited by CEO-elect Brian Dunn during a first-quarter earnings call on Monday.
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The new BB commercial makes me laugh. It has an ASSociate telling a story about a customer calling her for product knowledge from the floor of another retailer... Hehehe... I give them credit for trying to fool customers into thinking their staff has great product knowledge. A few displays and a new layout won't seal that deal though... Hopefully, this will help mom and pop more than them...
Mr. Nobody - 2009-19-6 18:18:00 EDT -
Remember to keep prices competitve though. Raising the bar to high during these times will just drive customers in to see the show and straight to Wal-Mart to get the item!
Lilliam Sandars - 2009-19-6 13:55:00 EDT -
As with Best Buy Mobile, this concept will be rolled out slowly as the stores digest the new operating model that was just implemented.
And any changes will have to be done under the lower capex budget already set for this fiscal year, so don't expect too many stores to have this new footprint. Newly opened stores, however, will probably have the new concept in place this year.
Bill Penn (billddrummer) - 2009-17-6 12:03:00 EDT -
BBY has been reinventing itself every year - its still nothing but smoke and mirrors.stay focused on warranty and subscriptions make wall street proud.
K.Porter - 2009-17-6 10:11:00 EDT -
This does sound familiar....CC, Tweeter and others all tried to be more service friendly before they gave up the ghost. Tweeter had clueless nitwits running the company the last six months so they were doomed no matter how good their service people were and trying to make CC service friendly with a bunch of kids running point was just moving deck chairs on the Titanic.
Perhaps BB will be more successful but for right now I'd take this as a major red flag that bears monitoring. Their floor is just as green as CC's was and BB is obviously much larger and just as much of a bureaucratic jungle.
But I do wish them well. I really don't want Wal-Mart and Costco to be the only CE survivors.
Sarah Connor - 2009-17-6 07:33:00 EDT
Best Buy Launching Programs To Grow Share
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