Smelling blood, the pundits are circling Best Buy.
Their arguments are now familiar, if debatable: Best Buy’s stores are a showroom for e-tailers; Best Buy’s real estate is an albatross; Best Buy overextended itself overseas; Apple, Amazon and Google are CE’s new ascending stars.
What’s forgotten in the chatter is how often the company had been written off over the last five decades, whether it was the tornado that toppled a Sound of Music store, the showdown in Chicago with No. 2 CE chain Highland Superstores, the controversial switch to a non-commissioned sales force, or the bad gamble on an outdated PC platform that nearly crippled the chain in the 1990s.
Granted, the stakes are far greater today for the now global Fortune 500 company, but in both good times and bad Best Buy has always inculcated a culture of reinvention.
Indeed, Brian Dunn reminded shareholders of that in his very first address as CEO. The company has succeeded by breaking old business models before they became obsolete, he noted, and will continue to “embrace challenge and change.”
Today that metamorphosis continues as the retailer repositions itself for a new generation of customers that carry the world’s collective knowledge in their pockets, and for a next-generation of connected devices that will transform the way they live.
In the process, Best Buy is literally betting the store on a multichannel future in which brick-and-mortar melds with e- and m-commerce, and showrooms remain a desired format to see, feel, demo and learn about CE devices.
To that end, the company is running full throttle to beef up its web presence, broaden its basket of support services, build out its Mobile shops, bulk up its gaming and appliance businesses, and transform its flagship stores into what Dunn describes as the “digital playgrounds” of the future as it focuses on a connected, four-screen strategy.
On the following pages Best Buy’s senior management provides a rare look behind the scenes at the complex machinery that’s guiding the evolution of the $50 billion business as it works to remain relevant in a rapidly changing world.
Whether the company will prove naysayers wrong again remains to be seen. But based on history, betting against the Best Buy brain trust could prove costly. Just ask Highland.