News Feature | February 13, 2015

How Best Buy Thrives

Source: Innovative Retail Technologies

By Brianna Ahearn, contributing writer

Best Buy Success

As Radio Shack files for bankruptcy and sells off more 1,000 stores, it's worth observing how Best Buy has managed to survive.  The retailer has embraced an omni-channel approach, looking for ways to make shopping interactive and informative for both shoppers on and offline.

One of Best Buy's focuses is creating new ways for customers to experience products in-store. In May 2014, the retailer began redesigning stores to create an interactive home theater experience, where customers could see televisions, sound bars, and more on display.

In October 2014, they rolled out their Connected Home department to more than 400 stores. The department features over 100 connected home devices to help consumers make purchase decisions for this popular product category, and there's also a branded website. Best Buy then partnered with Intel to create four specific stations for customers to test and play with Intel-powered technology; options included seeing a 3D printer demonstration, viewing an augmented reality experience, and using DJ equipment. June 2014 saw Best Buy adding a new photography website, with content to educate consumers on photography with videos, how-to guides, and product recommendations.

The store-within-a-store approach for Best Buy allows the retailer to focus on letting the consumer have an experience rather than just shop in a store. It's this tactic, and creating branded websites for some of their product categories that are helping Best Buy survive. This approach focused on giving consumers solutions rather than just products, when it came to common everyday concerns about electronics. The retailer is consistently held up as one of the best examples of customer-centric business practices, and has advanced its offerings each year. Best Buy began this initiative in 2005 by targeting 110 of its stores to receive more than $50 million in expenditures to improve customer experience. The result was a significant profit of 85% the first quarter of 2005. In contrast, Radio Shack first began showing problems of its decline that would eventually lead to bankruptcy. The retailer closed over 500 stores, but their problems continued. While Best Buy's profits are still down, it's consistently shown its up to the challenge by focusing on innovation customer experiences.