Best Buy Wants to Build a Differentiated Customer Experience

Best Buy Customer ExperienceBest Buy CEO Hubert Joly wants to build a differentiated customer experience.

During Tuesday’s fourth-quarter earnings conference call, Joly said he believes a differentiated customer experience can happen at Best Buy.

“We are pursuing a strategy that is focused on delivering advice, service, and convenience at competitive prices to our customers,” Joly said, according to Seeking Alpha. “Within this strategy, we are focused on driving a number of growth initiatives around key product categories, life events, and services. To drive these initiatives, we are pursuing and investing in the transformation of key functions and processes. We will also, in fiscal 2016, be facing industry and economic pressures on our business related to deflationary pricing and weak industry demand in certain product categories that we discussed last quarter.”

Joly added: “To win against this backdrop, investing now is imperative. While these investments will put pressure on our fiscal 2016 operating income rate, we believe they leverage our executional momentum and will allow us to build a differentiated customer experience and a foundation for long-term success.”

Fourth-quarter sales inched up 1.3%, to $14.2 billion.

“A compelling merchandise assortment and strong multichannel execution drove these better-than-expected results as we capitalized on the product cycles in large screen televisions and mobile phones,” Joly explained. “These two categories were the primary drivers of our year-over-year revenue growth, and more than offset weakness in the tablet category which was impacted by material industry declines.”

Joly said Best Buy also benefitted during the fourth quarter from its investments in inventory availability, mobile phone installment billing, and supply chain, including faster store replenishment and online delivery, as well as more effective and relevant marketing.

To date, Best Buy has delivered $1.02 billion in Renew Blue cost reductions−exceeding the $1 billion target. Best Buy’s Renew Blue strategy is designed to grow the company’s online business, enhance in-store customer experience, and leverage multichannel capabilities while delivering to its customers great advice, service, and convenience at competitive prices in the channel they want to be served. 

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