When Circuit City went bankrupt many observers had predicted that Best Buy will have a similar end soon. But last year, French executive, Hubert Joly, gave up his post at Carlson, a travel management company, to turn around Best Buy. Now, it seems that his efforts are bearing fruit. In the recent months, its stock price has risen, costs have reduced and profits have increased.
In a recent earnings release of this company it was announced that online sales were $477 million, a 10.5 percent increase on a year over year basis. The company stated that higher website traffic and order values have helped to raise online sales. There are many other factors which are behind these impressive figures. Let us take a closer look at the company and the efforts undertaken by them in the online sphere.
A Name to Reckon with
Headquartered in Richfield, Minnesota, Best Buy is a leading multinational consumer electronics corporation. Established in 1966, it was founded by Richard M. Schulze and Gary Smoliak as an audio specialty store. It was named “Company of the Year” by Forbes magazine in 2004, “Specialty Retailer of the Decade” by Discount Store News in 2001 and has won many other honours.
The Measures Taken
A series of steps were taken by this company to develop the online sales channel. The old site search tool was replaced, product recommendations for online buyers who had no items in their shopping carts were improved, purchasing Geek Squad tech support services online was made simpler and the shopping experience on tablets was enhanced. Additionally, it also provided location-specific product offers and also encouraged buyers to write product reviews.
Plenty of action in the coming months
In the next few months, this company plans on improving its site navigation to a greater degree. Special attention will be paid to online merchandising for in-store clearance and open-box inventory. It has also been trying out a program where 50 of its stores will operate as fulfilment centres for online orders. Moreover, it plans on moving its website to a new ecommerce platform by next spring.
The CEO, Hubert Joly is optimistic that the online conversion rates will increase and the overall margins will improve in the near future. This will be achieved by things like better prediction of consumer demand and giving a clearer picture of the inventory position to the consumers irrespective of the devices they are using to shop.