After the resignation of its CEO and later its founder in the wake a personal conduct probe, numerous store shutdowns, and a $1.7 billion quarterly loss, Best Buy is trying to draw people back to its stores. On an earnings call today, interim CEO Mike Mikan gave a candid assessment of what he saw as the flaws that have left Best Buy struggling against online retailers like Amazon. "Not that long ago," he said, "Best Buy was the authority in this market. Our stores wowed consumers... Best Buy provided a unique customer experience that gave us a clear edge over competitors. Not anymore." The company, he said, was unprepared for a market where information and products were easily available online, and now "Best Buy is not performing up to its past standards."
One of the biggest changes, Mikan says, will be with its employees. "We need to raise the bar for everyone, from the Blue Shirts to Geek Squad to those at the very top of the company, including myself." That means "better trained, better equipped team members" who can lure customers off the web. They'll also need to be able to speak knowledgeably about the tech that they're selling. "We expect the Blue Shirts and Geek Squad agents who will staff those stores will speak with authority about technology. Their mandate will be to shift the customer expectation from repair, our traditional Geek Squad offering, to one of relationship." It's a common sense idea, but it's also probably easier said than done on a large scale. More immediately, he also said Best Buy could use analytics to figure out what customers want to buy and maintain a stronger relationship.
Best Buy has already closed down fifty storefronts, but Mikan noticeably did not mention any more shutdowns, focusing instead on plans to make stores smaller and more targeted. All these plans, however, seem very much in the air right now. "We do not have all the answers today," he said, noting that Best Buy would be drawing up a multi-year blueprint later. "Make no mistake: we will reclaim that place of authority."
