Is Best Buy Doomed? Here is a Store Concept that Might Save It

The resignation of Best Buy's CEO Brian Dunn comes as a surprise for the way it unfolded, amid a probe on his "personal conduct".  However, many industry watchers and analysts had been wondering for months on when the departure would materialize, given Best Buy's disappointing results in the last few years.  One outspoken critic of the retailer's  operations is Larry Downes, whose article, Why Best Buy is Destined to Fail, is perhaps the best analysis of the company's current conceptual flaws.  I would suggest reading his article to understand all the issues that are plaguing the big-box retailer. 

Mr. Downes' analysis does not leave much hope for Best Buy and predicts that the consumer electronics chain is destined to close its doors.  His main criticism center around a few main point:
  • Confusing Store Layout
  • Operational Deficiencies
  • Poor Customer Service
  • Outdated Store Experience
These shortcomings can certainly account for Best Buy's poor performance.  In fact, they essentially violate the model that I outlined in this blog to develop an exceptional customer experience.  However, they do not necessarily have to spell impending doom for the big-box retailer.

Let's try to consider a new store concept and design that could restore a unique customer experience and increase Best Buy's profitability.

Store Concept

Best Buy's current retail concept is to be the one stop shop for a customer's electronic needs, irrespective of demographic differences.  Therefore, the store needs to stock most price points, brands, and categories.  This strategy resulted in large stores with confusing layouts and overwhelmed staff. 

Best Buy should try to identify its core consumers for each category of products and target its offerings to those consumers.  They should also carefully evaluate categories and brands and stock only the best performing products.  They could then employ a scarcity tactic, which has proven extremely successful at Trader Joe's, as I wrote in my post: 3 Key Tactics that Retailers Should Learn from Trader Joe's.  This would allow them to reduce store size, while at the same time retain its experience and presence in multiple categories.

The  company has already announced the closing of 50 of its big-box stores in favor of 100 small-format stores that would focus on it successful mobile business.  This might improve its immediate profitability, but Best Buy needs to turn around its broader business model if it wants to be a major player going forward. 

Store Design and Layout

I would expect Best Buy's analytics to show that distinct categories like video games, office products and appliances all have diverse consumers.  In fact, even if Best Buy is one single store, such diverse categories, as the ones Best Buy carries, have to be presented in different ways as they appeal to separate target markets.

The store would have to be divided in different areas, salons or sections.  All sections of the store would have a lounge like feeling where the customers would be able to immerse themselves in the product experience in a comfortable setting. Each product category would be presented in installations that would clearly display its features to the customer and ultimately increase his or her engagement.

In my post, Discover a New Store Concept Idea for Any Media Retailer, I presented an innovative store design that could apply in certain sections of Best Buy's stores, most notably in the video games, movies and music areas.  The TV area would feature a comfortable living room where customers could experience Best Buy's most popular home theater solution.  The home as well as the appliances sections would display the products in home-like installations.  In all these sections sales associates would assist the customers, present additional scalable solutions and help them design their own home theater or kitchen with the aid of tablet computers.

All other sections would have to be similarly designed to engage the customer and provide a more complete customer experience.

Customer Service

Best Buy would need to thoroughly train all of its employees to deliver better customer service.  Sales associates would need to have a deep and complete knowledge of their products.  However, that would have to be only the initial step. 

Associates would need to present not only the actual features of the products but also the economic, functional and psychological benefits that would arise from the purchase.  They should also try to create trust and a sense of likability and congeniality.

Best Buy would need to introduce customer centric policies that would effectively encourage store staff to try to satisfy any request and solve any possible issue.  They should also encourage staff to listen to their customers and tailor product offerings based on feedback.

I am confident that this new store concept and business model could save Best Buy.  What do you think?


  1. Downes, whose article, Why Best Buy is Destined to Fail, is perhaps the best analysis of the company's current conceptual flaws. I would suggest reading his article to understand all the issues that are plaguing the big-box retailer Best buy computers

    1. Hi Sam,

      Thank you for the suggestion. Larry Downes article is certainly a good read.

      Best Regards,