Best Buy Co., Inc. Customer-Centricity
Best Buy Co., Inc. Customer-Centricity
Background:
The consumer electronics giant, Best Buy, was first established in 1966 with a single location and a staff of three in St. Paul, Minnesota, selling audio equipment targeted at 18-25 year old males. Initially Sound of Music/Best Buy grew through acquisition, expanding to nine locations in the Twin Cities area by 1978. The name, Best Buy, and expanded product line, ranging from audio and video equipment to large appliances, were a result of a “best buy” sale of damaged inventory at bargain prices in 1981. In the mid-1980s, Best Buy launched superstores similar to those of their main competitor, Circuit City and expanded by 15 stores between 1985-86. In 1989, Best Buy launched itself as a self-service, value-store staffed with a salaried sales force to provide a no-pressure shopping experience. This approach resulted in Best Buy becoming the second largest electronics retailer. By 1995, Best Buy was opening an average of 35 new stores annually and in 2000, the retailer responded to the market by launching BestBuy.com.
Best Buy attributes some of their success to their SOP, standard operating platform, which is a 200 page “how to” manual for nearly every feasible store situation ranging from product sales and service to inventory management. The purpose of the SOP was to train the sales force and promote uniformity across the organization. In addition to the SOP, Best Buy’s skillful merchandising and marketing, along with their sales force (“Blue Shirts”) are credited with the success of the retailer. Blue Shirts received extensive training and enjoyed a unique and rewarding corporate culture, with part-time associates making $8.00 per hour and full-time employees earning $20.00. Sales associates often received public recognition for strong performance in addition to immediate rewards such as restaurant vouchers. Supervisors were also incentivized based on annual department and store performance. Starting store
Background:
The consumer electronics giant, Best Buy, was first established in 1966 with a single location and a staff of three in St. Paul, Minnesota, selling audio equipment targeted at 18-25 year old males. Initially Sound of Music/Best Buy grew through acquisition, expanding to nine locations in the Twin Cities area by 1978. The name, Best Buy, and expanded product line, ranging from audio and video equipment to large appliances, were a result of a “best buy” sale of damaged inventory at bargain prices in 1981. In the mid-1980s, Best Buy launched superstores similar to those of their main competitor, Circuit City and expanded by 15 stores between 1985-86. In 1989, Best Buy launched itself as a self-service, value-store staffed with a salaried sales force to provide a no-pressure shopping experience. This approach resulted in Best Buy becoming the second largest electronics retailer. By 1995, Best Buy was opening an average of 35 new stores annually and in 2000, the retailer responded to the market by launching BestBuy.com.
Best Buy attributes some of their success to their SOP, standard operating platform, which is a 200 page “how to” manual for nearly every feasible store situation ranging from product sales and service to inventory management. The purpose of the SOP was to train the sales force and promote uniformity across the organization. In addition to the SOP, Best Buy’s skillful merchandising and marketing, along with their sales force (“Blue Shirts”) are credited with the success of the retailer. Blue Shirts received extensive training and enjoyed a unique and rewarding corporate culture, with part-time associates making $8.00 per hour and full-time employees earning $20.00. Sales associates often received public recognition for strong performance in addition to immediate rewards such as restaurant vouchers. Supervisors were also incentivized based on annual department and store performance. Starting store