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Brand Analysis

Mathew Goldberg, Jesse Silverman,

Best Buy’s Mission

Best Buy’s mission is “to improve people’s lives by making technology and entertainment products affordable and easy to use.”

Has become the nation’s largest volume specialty retailer of name-brand consumers’ electronics, home office equipment, entertainment software and appliances.

Industry AnalysisTechnology Trends and Dynamics

• More adults are able to pursue a post-secondary education because of online education growth. Also enrollment and application are accessible via the Internet (source: Education Dynamics).

• Human connectivity, social media and online shopping exemplify rising aspects of the technology market dynamic from the last ten years which leads to more adults investing in different kinds of technology in new ways (source: Global Futurist).

Competitor Analysis

According to Forbes – Retailers have tried to gain market shares in technology since Circuit City’s bankruptcy in 2008.

These main retailers include:

Walmart markets themselves as the most convenient store, with the most convenient prices. They are extremely successful in gaining a loyal following, making it a weekly experience.

Strengths: • Everything is offered at Low

Prices• Huge Customer Base. More

than 100 million customers weekly in the U.S. alone (PBS)

Weaknesses:• Not enough variety within

their technology selection. • Staff not necessarily trained

to answer complicated questions.

Marketing Strategy: Low Prices, Tapping into constant customer base

Related Stores: Target, Sams Club, BJ’s

Radio Shack, markets themselves as a complete tech focused business. They strive to make their customer’s lives easier by connecting them with necessary technology.

Strengths:• Operates out of small store

fronts• More one on one help. • Assistance the moment you walk in• Low Prices

Weaknesses:• Scarce variety of products and product

lines• Mainly focuses on Communications (Phones, Wireless Connections)

Amazon relies on adapting to the customer’s needs and wants to be successful. The customer is the boss. As a result, it has become the leading online market place.

Strengths:• Don’t have to worry about

physical locations .• No need to leave the house.• Quick delivery.

Weaknesses:• Customers do not have the product

immediately. • Prices are not constant, many different vendors• An employee isn’t by your side, assisting with a product.

Related: New Egg, EBay

Brand Analysis

Middlewood, Martin. “Best Buy Rolls Out Customer – Centricity Program.” CRM Buyer. 2004. Web. 13 March 2012. Bustillo, Miguel. “As Big Boxes Shrink, They Also Rethink.” Wall Street Journal. 2004. Web. 13 March 2012.

Mission & Business• Technology & Entertainment Strategic Goals • Technological hub• Customer Centricity Market Share• Unexpected DecreaseDistribution• Storefronts• Increase in online shopping

SWOT ANALYSIS

Pearce, Aneysha. “Highlights from Prophet’s First Annual U.S. Reputation Study” Prophet. Web. 13 March 2012. “Funding Universe”. The Gale Group, Inc. 2006. Web. 13 March 2012.

“International Expansion Key for Best Buy.” The Street. 2010. Web. 13 March 2012. Gerzema, John & D’Antonio, Michael. “How The Crummy Economy Has Changed Spending Habits.” Business Insider.

2010. Web. 13 March 2012.

Customer Analysis

• Catering toward a “high-profit” customer (source: Wall Street Journal).

• An unprofitable consumer, as the article states, “buy products, apply for rebates, return the purchases, and then buy them back at returned-merchandise discounts.”

• Profiling its customers and identifying the most profitable segments lead Best Buy to see an 8.4% increase in sales that same year it installed its new strategy. By adapting to the growing trends (i.e. enterprise mobility) they’ve seen an increase in profitability (source: Jennings on “Segmentation).

Customer Analysis Cont.

• For its "Barry" segment, which represents wealthy professional men, Best Buy will add leather couches to some stores to create a comfortable environment for watching large-screen TVs and listening to high-end sound systems. Stores targeting "Jills," who are soccer moms, train their sales associates to help customers without using terms like "gigabytes" and "megapixels," which may be intimidating (source: Jennings “Segmentation”)

• By plugging into the power of customer centricity, Best Buy has become North America’s number one specialty retailer of consumer electronics software and appliances according to FICO

Communication Strategy Positives

1) Customer Centricity- Looked at the company from the outside in, Segmenting your customers- Related products became bundled together- Added Geek Squad, and Play areas for kids- Very hard to do, necessary for most companies2) Website- Easy to use, Lots of options, multiple categories- Very detailed, educates customer on product they are purchasing- Quick Checkout with multiple billing options

3) Cloud Marketing- Vision is to give consumers the power to buy products quickly and easily

regardless of how or where they prefer to buy- Large enterprise developers vs. smaller long-tail developers.- Drives more revenue and leverages Best Buy’s biggest competitive

advantage against pure-play E-commerce retailers

Others: Mobile Marketing, Point of Sale, Social Media

Gulati, Ranjay. "Inside Best Bu'ys Customer-Centric Strategy." Harvard Business Review. N.p., 12 apr 2010. Web. 11 Mar 2012. <http://blogs.hbr.org/hbsfaculty/2010/04/inside-best-buys-customer-cent.html>.

Communication Strategy Negatives

1) Weekly Mailings- Supposed to advise customers on products and deals in store- Tried to add in to information such as low prices, sales, education on

technology, questionnaires, etc.- Morgan Stanley Analyst Greg Melich said, "I like that Best Buy has all these

balls in the air, but they are not all going to work.”

2) Community Relations/PR- Best Buy Children's Foundation and other assorted efforts- Doesn’t have a strong fit with their business, builds relationships only with

people it directly affects- Brings little public awareness

3) Print Advertisements- Most Ads in Wired Magazine, a magazine mostly read by technologically

savvy- Mostly about Brand Awareness, doesn’t build customer relationships

Augustine, Erica. "IMC-Observation:Best Buy." Company Overview. Mkting 4100. 2006. Print.

Social Media1) Facebook- Over 5,500,000 followers, updated daily- Segmented pages (Music, Movies, Racing Gaming, etc.)- Promotions/Deals2) Twitter- Updated Daily- Over 260,000 followers- Promotions3) Geek Squads Supportopedia- Blog like website with sharing of information and tips on technology- Supported by Geek Squad (They will answer your questions)4) SPY- Puts all social media websites together- You can scroll through each social media site on one screen quickly.5) Youtube

Michele , Azar, perf. Open for Business: Best Bu'ys Social Technology Strategy . Perf. Matheny Kevin, and Thomson John. Best Buy, 2009. Web. 10 Mar 2012.

In Conclusion…

• We plan to build a new strategy to bring Best Buy back to the top of the technology industry by…

1) Regaining Brand Loyalty2) Improving prices3) Hiring better staff4) Upgrading technology