MKTG 661 Marketing Polices Fall 2012
Case Analysis: Best Buy
1. Problem Statement
Thanks to Best Buy’s new strategy “Customer-centricity”, which initial developed to increase their profits and margins. Best Buy, as the retailer leader in customer electronics in the North America, had reported double-digit revenue growth every year and rarely missed earnings until 2005. The new problem is that could Best Buy ...view middle of the document...
In the past, Best Buy’s competitive advantage was lowering price due to the large amount purchase of merchandises and providing famous name-brands that their customers are familiar with. But these strategies may not profitable today because Best Buy’s new conception “Customer-centricity”, which have to spend more to offer more service-base business activities to their customers. The cost to service one customer may higher than the gain, especially many people just go to Best Buy to inquire the information of products and make a purchase in Wal-Mart, or online stores. Best Buy should implement “Customer-centricity” to the specific high-end customers who willing to purchase high-end products no matter the price. Meanwhile, just have some general sale forces at those normal customer electronics zones to have to largest margin based on the original price advantage. In this way, it will cost less on the sales force and continue provide the Customer-centricity strategy to some specific kinds of customer segments in their stores, and have the competitive advantage based on the lower price compare to their competitors, Wal-Mart, Amazon, and some other price leader companies.