Best Buy- case study

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Best Buy- case study

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Best buy has been facing intense competition from online stores. This is a sample presentation on the best buy case study. The presentation discusses how Best Buy Loses Customers Due to Online-Only Competitors. – PowerPoint PPT presentation

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Title: Best Buy- case study


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Best Buy Loses Customers Due to Online-Only
Competitors
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Your Local Showroom
  • Best Buy has been facing a difficult issue with
    customers visiting their stores to view and test
    certain products. This is not beneficial to the
    store, because once the customer knows what item
    and model they want to purchase, they go
    elsewhere, specifically on the internet, to shop
    the best price and have it shipped to their door
    (Team, 2012). The following slide shows how
    businesses are being affected by this current
    situation.

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Direct Effects on BusinessWe Know Love
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Who is Being Effected
  • Because Best Buy was losing sales as a result of
    Showrooming, the shareholders of the publically
    traded company were incurring losses. In
    addition, communities were losing tax revenue
    when their local Best Buys would have to shut
    down. These stores are often housed in large
    properties, so vacant buildings can decrease the
    real estate value of neighborhood as well.

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Who Else is Being Effected
  • There is also the human side of failing
    businesses. People are at risk of losing their
    jobs and, in turn, their livelihoods when a
    company is not being productive.
  • The personal touch is lost in an online only
    model. Some families, and especially senior
    citizens, do not have easy access to
    online-buying, which makes the loss of a
    brick-and-mortar store a real disadvantage.

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Price Matching to HelpRetain Customers
  • Best Buy has decided to extend their Holiday
    Season event of price-matching to be a permanent
    occurance. This is believed to keep customers
    coming to their store and to help ensure they
    make their purchases on site.
  • Theyve also formed relationships with Apple and
    Samsung to create a new store-within-a-store
    model.

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Its an Online World, Keep Upwith the Technology
  • Best Buy has had many complaints about its
    website in the past. One thing they can do to
    help boost sales is something they have already
    discussed doing, enhancing their website and
    making it more user friendly. The article states
    that Best Buy plans to invest 750 million on
    different areas of improvement, website being one
    of them.

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Promising Future
  • The recent changes that Best Buy is implementing
    are causing some to call them the next Home
    Depot, a retailer that also recently improved
    their situation by making changes to their
    business model. The rosier outlook has been
    reflected in their stock price

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potential solution(s) to resolve the issue
  • In the last few years, Best Buy has been used as
    a perfect example of a businesses that is heavily
    affected by online retailers. The main challenge
    for Best Buy has been more competitive online
    sellers and the problem of show rooming within
    its stores. Below are some ways to deal with this

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Tackling problem of online stores
  • The best way to combat the problem of online
    competition is by setting up an ecommerce website
    to put itself at par with the competition. The
    company has already considered this among its
    budgeted upgrade projects.

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Solution to show Rooming
  • The company has become less profitable as
    customers only come to the stores to look at the
    product features and price then buy the product
    online at lower prices.
  • The best way for the company to deal with it by
    making sure that the company converts show
    rooming customers. The company can do this by
    improving its customer service.
  • In addition, the company should expand its
    product mix from selling large electronics like
    the Television to other products with a lower
    warranty margins to ensure that its profitability
    increases(Team, 2012).

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References
  • Gara, A. (2013 , April 8). Best Buy May Be the
    Next Home Depot (Update 2). Retrieved from Yahoo
    Finance http//finance.yahoo.com/news/best-buy-ma
    y-next-home-134700769.html
  • Team, T. (2012, November 11). Best Buy's
    Earnings Still Facing Showrooming And Product
    Mix Challenges. Retrieved from Forbes
    http//www.forbes.com/sites/greatspeculations/2012
    /11/19/best-buys-earnings-still-facing-showrooming
    -and-product-mix-challenges/
  • WINGFIELD, B. N. (2013,, FEBRUARY 27). More
    Retailers at Risk of Amazon Showrooming.
    Retrieved from New York Times http//bits.blogs.n
    ytimes.com/2013/02/27/more-retailers-at-risk-of-am
    azon-showrooming/?refbestbuycompany

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