Looking back, it was somewhat ironic that I found out about the resignation of Best Buy CEO Brian Dunn two weeks ago while on a flight to attend the Home Technology Specialists of America (HTSA) meeting in San Diego.
You would think HTSA, a buying group of custom installers and high-end retailers whose individual sales volumes are miniscule in comparison with Best Buy, would have little in common the No. 1 CE retailer, but you’d be wrong.
When I got there, I was told point-blank by one HTSA dealer: “You can say that Amazon has affected all of the retailers in this room in some way. Consumers used to come in and ‘kick the tires’ and check prices. Now that doesn’t happen as much.”
In his opening presentation, Bob Hana, managing director, stressed integrated marketing to his members, with a heavy emphasis on online marketing, use of social networks, outreach programs, improved websites and the like, to get existing customers and attract new demographic groups – 18- to 25-yearolds for instance – who may be intimidated to enter a typical HTSA member’s store or showroom.
HTSA-type installers and retailers were hit hardest by the recession, but are reviving in part because of the entrepreneurial spirit of its members.
Or, as Hana commented to TWICE about Best Buy’s prospects, “I don’t see why [Best Buy] can’t rebound and grow. It depends how quick and nimble you are. HTSA members are survivors and have done just that.”The resignation of Dunn, no matter what the circumstances, is unfortunate for him personally and a further distraction for Best Buy during an already critical period for the chain.
But Dunn’s resignation provides Best Buy a unique opportunity to dramatically change its business model, break some of its own rules and get back to the more entrepreneurial roots that has made it the nation’s top CE retailer.
That is just one of the suggestions made by industry executives and analysts TWICE questioned in the past two weeks for the special report.
But due to the dramatic emergence on Amazon.com and online retailing in general, as well as mobile shopping, one retail executive told us, “Right now all of their initiatives are in reaction to what has changed rather than them being the architect of change.”
In speaking with executives the past two weeks, the general opinion that the industry needs a Best Buy turnaround, to provide a diversity of retail channels. They also feel Best Buy’s survival is needed to help ensure new technologies are introduced because general merchandisers – no matter how profitable or if they are online or brick-and-mortar – lack the commitment to CE to make those future technologies succeed.
Best Buy, and its chairman and founder Dick Schulze, became “the architect of change” when hard times hit the chain in the 1990s. We will soon see if history repeats itself and Best Buy can get back to its entrepreneurial roots, make changes and bounce back once more.