The once-mighty Best Buy is doing everything it can to turn things around, and there will be plenty of lessons to learn about the future of retail—both online and brick-and-mortar–as the company goes through its metamorphosis.
Right now, Best Buy is going through a period of flux. It has a brand new CEO in former hospitality exec and turnaround artist Hubert Joly, while founder Richard Schulze continues to try to buy back the company.
On the front lines is the recently-hired Scott Durchslag—a former Expedia exec, Skype CMO and McKinsey partner. He’s the new president of Best Buy Online and Global E-Commerce. He is overseeing all of the embattled retailer's e-commerce channels, including BestBuy.com and mobile. In an interview, Durchslag talked about his new job and what his vision is for e-commerce at Best Buy, as well as the first three steps that he has to take to get things going. These steps could also be adapted to a small-business environment.
The changes will not come in one big revamp, assures Durchslag. He uses the word "breadcrumbs," explaining that he plans to make small changes and guide consumers through them the whole way so that they understand their value.
Compete on Price and ValueStep one is to develop a winning value proposition that takes into account the emerging behavior of consumers. Most important is price competitiveness, Durchslag says. Best Buy has to keep up with mammoth competitors Wal-Mart and Amazon. Then, the company can "widen the dimensions" of that value. By making things more convenient (such as scheduling delivery right on your mobile device in a store), customers will have a reason to purchase right then and there.
"If they can trust the place, they're going to pull the trigger and buy it," Durchslag says. "If they're not sure about that, they're not going to make the leap of faith."
Fix the Fundamentals
Best Buy needs to make everything in step one operate as seamlessly as possible, explains Durchslag. For instance, BestBuy.com has room to improve. The site has to be reliable so that it can handle all the transactions that it needs to deal with, no matter what the conditions.
And then there's tons of opportunity for better relevance when browsing. Again, it's about making it easier for customers to interact with the site, he says. Also, on the website, all the shopping pages need to be simple and clean to the point that no customer will ever need an extra click to get what they want.
Mobil and SocialThe third step in Durchslag's plan is to build in layers of innovation in ways that are intrinsically mobile and social. Once you have those things in place, you have the opportunity to "really innovate to differentiate" in the mobile and social realms, he says.
Some examples are automatic, such as personally tailored recommendations on the website from Facebook Connect. When you go into a store, your device could welcome you, tell you how many rewards points you have and exactly what you can do with them.
"How do we become the Netflix of consumer electronics? Offers about things you're most interested in and the time you're most interested in them," Durchslag says. "These things are available to you in multiple ways in the stores. That's something nobody is doing right now."
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