Best Buy Customer Centricity Case Study Analysis In Education

BEST BUY STUDY CASE ANALYSIS 3 Background information Best Buy Inc is a multinational and multichannel worldwide retailer of electronic products and related products with its headquarters in Minnesota, USA. Apart from selling a variety of electronic accessories at its stores, Best Buy Inc, offers technical support services to its customers such as repair and installation of the electronic gadgets under the Geek Squad brand (Amendola, 2014). The company deals with electronic gadgets such as mobile devices, computers and office equipment to domestic electronic products such as television and refrigerators. According to Amandola (2014), the company operates under domestic and international segments. The domestic segment comprises of its trade activities within the United States of America while international trade activities includes involves its trade activities outside the territories of the United States. Best Buy conducts its activities in three ways; via e-commerce, retail stores and operating call centers (Amandola, 2014). The company operates in different locations using a variety of names such as Magnolia Video Audio, Geek Squad brand, Future Shop, Five Star and others, depending on the type of services offered or products sold the store. Corporate governance Best Buy Co.Inc CEO is Hubert Jolly with over a hundred thousand employees all-over the world (Prindle, n.d). Of its employees, one hundred and sixty thousand are located at its retail stores in United States with the rest located in Canada and China. The company generates over $ 36 billion in terms of profit annually with an estimated expenditure of over $100 million for energy (Prindle, n.d).

Case | HBS Case Collection | April 2006 (Revised October 2006)

Best Buy Co., Inc.: Customer-Centricity

by Rajiv Lal, Carin-Isabel Knoop and Irina Tarsis


With FY2005 sales of $27.3 billion, Richfield, Minn.-based Best Buy Co., Inc. was the leading retailer of consumer electronics, home-office products, and related services in North America. Its operations included the distinct store formats Best Buy, Future Shop in Canada, and Magnolia Audio Video as well as service provider Geek Squad. For the eight years leading up to 2004, Best Buy had reported double-digit revenue growth every year and rarely missed earnings. But on December 13, 2005, Best Buy missed its third-quarter earnings per share (coming in at $0.28, not $0.30). The company's stock price fell nearly 12% that day, a loss of $2 billion in market cap. The poor results were attributed to the aggressive rollout of 144 new "centricity" stores--revamped retail formats featuring a customer-centric operating model designed to offer targeted "value propositions" to one or two distinct customer segments. The new format was a departure from Best Buy's winning formula and required adjustments in interactions between various parts of the Best Buy organization, including a new set of segment leaders.

Keywords: Customer Focus and Relationships; Service Operations; Business Earnings; Financial Crisis; Failure; Business Model; Leadership; Segmentation; Value Creation; Electronics Industry; United States; Canada; Mongolia;

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