Best Buy Sees ‘Connected' Holiday Season

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New York - Best Buy is not only dreaming, but planning for, a connected Christmas - one where its wide assortment of CE technology, Geek Squad to install and service consumers, and its ability to compete on price will be a winning formula this holiday season.

"We see this as a 'connected Christmas' and we are really excited about that," said CEO Brian Dunn at the retailer's annual Holiday Preview, here, this morning.

Illustrating its breadth of product, Dunn said Best Buy is the only place where you can buy the Sony Reader, Nook by Barnes and Noble and Amazon's Kindle, "and you can see them all side by side."

 

But, he noted, "Let's be really clear. It is a tough environment out there. It is episodic with the highest highs... but the holiday episode is upon us and it could be a great holiday season."

Concerning the "episodic" market, in this case the sluggish summer for TVs, Dunn said, "It would not have been good to promote TVs [then] when consumers were not focused on them. You must strike when they are focused."

This fall consumers should be and Mike Vitelli, president/Americas, said that in TV Best Buy will be featuring its own Dynex and Insignia house brands in the fourth quarter, but "established brands like Sony, Samsung, LG, Toshiba... we will have an unparalleled assortment of strong and aggressive price points."

On the service side, George Sherman, senior VP of services, said that Best Buy now serves "four channels" with the Geek Squad at the service center in Best Buy stores, the ability to do car installations, online and phone support.

Sherman noted that the Geek Squad used to be split up between PC and home theater installations. "New technology requires new home networking installations. You now need teams with both capabilities." The company teamed former PC and home theater experts together to go on calls and now they understand both technologies.

He said between Christmas and New Year's Best Buy will offer free tech support via the Geek Squad.

Dunn said consumers can open gifts on Christmas morning bought at Best Buy, "And when you begin to set them up you'll have the Geek Squad online or on the phone to help the installation. That's compelling."

But he was emphatic that, "You do not win [at retail] in November and December... you have to earn that business throughout the year, when [consumers] touch your brand."

Still, Best Buy is taking nothing for granted. For instance when asked about sluggish TV sales and about pricing for Black Friday and the entire season, he replied, "I think great prices are table stakes. There will be smoking hot prices at Black Friday and then it will be about [value-added services]. We are confident about winning because there we will be there in pricing and services" as well as selection.

Aside from free online or phone tech support from Best Buy between Christmas and New Year's the chain announced a variety of moves to support its efforts. Among them are:

  • Best Buy Mobile, which has 100 stand-alone stores currently, will grow by as many as 50 more by Thanksgiving if construction in all locations is completed on time.
  • Beginning October 1 Vitelli said that Best Buy Mobile will offer "free phone Fridays" with special deals on popular cellphones.
  • While CDs and DVDs will have less space on a typical Best Buy floor depending upon the location, the entire assortment will be available online. There will be more Blu-ray available, Vitelli said. The vacated space will be taken by motion space gaming and an area of handling trade-ins of video games, the latter of which is being rolled out now.
  • Best Buy will offer its "best financing offers ever" making it "faster and easier" for qualified consumers to buy TVs and home theater systems and "connect them with broadband services.
  • Best Buy's ad budget will spend more on than last year. While Dunn would not qualify the size of the Q4 ad budget Advertising Age reported that it will emphasize TV ads.
  • It will hire 29,000 workers for the season, the same as last year.

For more on Best Buy's holiday plans and a profile of CEO Brian Dunn check the October 4 print edition of TWICE or visit

www.twice.com/oct4

on Oct. 4.

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