Best Buy Essay

Best Buy is one of the world’s largest multinational consumer electronics retailers with stores in Canada, China, United States and Mexico. Richard M. Schulze and Gary Smoliak founded Best Buy in 1966, but it was established as a company in 1983. The company’s stores offer video products, audio products, musical instruments, mobile electronics, home & office products, and networking equipment as well; it also provides service contracts, warranties and repair services; therefore, it operates as a retail store, online retail and call center. Best buy has been facing the increase in competition from online retailers and discount stores however the company has been reorganizing its e-commerce offerings and making other site upgrades. An effective communication is important for managers in the organization so that they can perform their jobs and responsibilities. A manager would need the basic functions of management that are planning, organizing, leading and controlling. Customers turn to Best Buy for purchases and answers to their technology questions; this company gives their clients the opportunity to communicate, learn with all different benefits that Best Buy has to offer. Today, we have become more dependent on technology. We live in a society that is called â€Å"technologically civilized†, meaning that every small work we do, is technology dependent. Every person is carrying a device or gadget that is technically advanced. Ultimately we can say that in this technical world of today, we are much dependent on technology. Gadgets make it easier for communication to take place when someone needs to reach out to other people in different countries. We also use technology to work, purchase things online and basically do almost everything. As a company, Best Buy strives to reach out to their local community to provide new and creative programs to serve the community. Best Buy will train their employees to educate shoppers on hand held devices and walk them through purchase and activation. In the customer support section, shoppers can ask Best Buy employees what they can do when something goes wrong with a hand held device, as when the screen breaks. Marketing strategic plans Best Buy is one of the largest specialty retailers in the United States. It is the 10th largest online retailer in the U.S and Canada and it is also number one in customer service. All employees are committed to helping deliver the technology solutions that provide knowledge, values, and ideas whether online, via mobile device or in stores. It also provides variety of services which makes them one of the leading retail and consumer merchandise companies. With each visit, Best Buy offers the customers an inviting and inspiring experience. Best Buy sets high-quality standards of communication and uses different marketing strategies to reach the public. It appeals to a diverse public and makes sure whoever enters their stores, feels comfortable enough to approach one of our employees when they need help. Best Buy’s communication aims to build a reputation with best quality brand and service. Best Buy sells a wide variety of products that appeal to all ages and gender types. They are an electronic store that sells DVDs, CDs, video games, iPod and mp3 music, phones and TVs. There is a music section that appeals to musicians, where you can get music albums and musical instruments. You can find phone sections for those who need or would like to have the latest phones. You can also pick up a computer or laptop for personal use or work. Television lovers have a big section as well. Best Buy has a lot more to offer for the younger audience, there are toys and video games. For the older audience there are appliances, suc h as TVs, home theater systems, car accessories, office supplies and more. Overall Best Buy target audience is not specific due to their variety of products. Best Buy’s  target market is the general consumer; the one that continuously visits their stores and that are satisfied with their product quality. In order to get a hold of their customers, Best Buy mostly advertises the latest phones, such as the Apple iPhone, and Samsung’s Galaxy. Phones are an everyday necessity and Best Buy has made it their main product to advertise. There are seasonal promotions where Best Buy has summer sales for back to school and Christmas sales for the winter. Best Buy takes a hold of their customers by doing this. Customer loyalty is not a problem due to their variety of product. Customer loyalty programs/Customer Service Best Buy has different strategies to keep customers coming back and buying their products. When school is back in session, usually around August 1st they commence their back to school deals on electronics such as laptops, tablets, cameras, phones, TVs and any other sort of devices students need or like to buy, which is their way of getting people’s attention by lowering the prices of their favorite electronics. Best Buy’s slogan on the back to school deal is â€Å"Deal today. Gone tomorrow. Limited quantities.† They have free in-store pick up, which will allow the customers to pick it up at the store, avoiding shipping and delivery charges. Aside from having back to school deals, Best Buy works on developing customer loyalty by having the lower price guarantee, which is finding a lower price and matching it. The way it works is if the customer finds an item at local competitor retail store or Mayor Company online with a lower price than Best Buy, they will do their best to match that price, both in stores and online. It is their way of keeping the customers committed to their stores and to keep them from buying an item at another store. â€Å"Deal of the day† is also a method used to keep customers engaged and to improve customer-driven service quality. Best Buy puts popular items up for sale. They have weekly offers, texts alerts and emails to alert you when there’s a sale going on and customers will have the chance to buy quality items at a more reasonable price. When you order online, they have free standard shipping on sale items and no minimum purchase required. These deals improve customer loyalty an d customer satisfaction. Product Quality and prices When you want to buy an electronic, the first place you think of is Best Buy. You look for Best Buy because is a familiar place and you trust that you can get a quality product along with great prices. They have owned up to their image by building up to customer loyalty along with customer satisfaction and customer engagement. With the merging of different operating systems all in one place, Best Buy promises the latest devices and services, knowledgeable employees, impartial advice, competitive prices, ability to shop online as well as in stores and support for the life of the products. In order to keep those promises, Best Buy offers a variety of exclusive services to make the most of the mobile technology. They have upgrade checker, where buyers are able to know whether or not they are eligible for a new phone. They also have a program called â€Å"trade-in† where customers trade in their mobile phone and in return they get a $200 Best Buy gift card. The â€Å"Geek Squad protection† is a service that Best Buy provides from within the store. They have a section with letters written on top spelling out â€Å"Geek Squad† in orange, black and white. Their slogan is, â€Å"Go ahead. Use us.† It covers accidental damage from handling battery replacement to repairing electronics. They also have an app that customers can access the Geek Squad and get protection benefits. Best Buy also offers phone activation and transfer all of your contacts to your new phone. They call it the â€Å"walk out working† program. They can set up your phone as soon as you buy it and will throw in a Bluetooth set up. And to ensure that you get the best service, they offer a Best Buy rewards card. You pay no interest and you are able to earn rewards as long as you use it. As for product prices, best buy has the most popular operating system, all in one store. They sell the Windows Phone, Blackberry products, iPhone products, Android products, Bose electronics, Beats products, and many more. Prices range from $49.00 to $ 399.99 for phones. And that’s including new phones. They put newer phones at a lower price when the customer signs a service contract. The lower prices help lure the customers in the store, resulting in greater revenue. SWOT Best Buy specializes in consumer electronics, home office products, entertainment software and household appliances, therefore is one of the largest specialty retailers, providing a diverse customer service. Best Buy gives a major importance to the Strength, Weaknesses, Opportunities and Threats (SWOT) that the company may face. Some of the strengths are that it operates more than 1,150 stores in the United States and abroad. Its revenues are $16.26 billion and profit of $651 million. It also leads U.S retailer offering a wide market mix of services in computers, televisions, tablets and cameras. The weaknesses of the company are primary reducing prices to match competitors, it established image as a lower quality retailer and some impacts from the past of class action lawsuit. The opportunities for Best Buy are primarily to grow in sales of mobile phones and tablets, extended store hours, hiring highly trained sales consultants so that they can assist with technical issues, improving inventory management through long term relation with supplier, as well as outsourcing items to China which will lower production costs. The threats that Best Buy encounter are the online and retail competitors. Its current competitors are Staples, Office Depot, Wal-Mart, Costco, Sam’s club and Amazon. Another threat would be the pressure to reduce prices because of the competitors and rising labor wages. Competitors around 5th Ave Store Its competitors around 5th Ave store (between 43rd St and 44th St) are H and B Digital (located on 46th St between 5th Ave and 6th Ave), RadioShack (located on 42nd St between Madison Ave and Park Ave), and Barnetts Computer Warehouse (located on 5th Ave between 38th St and 39th St). Other than these, there are many electronics retailers on 5th Ave within 10 blocks from 36th St to 46th St all of which have its own competitive advantages to survive in this area. For example, RadioShack retails a wide range of products, from cables to cameras. They offer technology products, accessories, mobile devices, and power supplies. Therefore, competition in this area is also intensive, as many competitors that have their own competitive advantages and strengths surround the store. Competitors in general Major competitors for Best Buy CO., Inc. are Wal-Mart Stores Inc., Dell Inc., RadioShack Corp., Target Corp., etc. The leader of this market is Wal-Mart Stores, which has 252.14 billion market capitalizations. Wal-Mart’s strengths are that large scale of operation and word-wide, which is 3,615 stores in all over the world, and low cost performance. RadioShack Corp. also has 4,453 stores in the United States and Puerto Rico, according to its official web site. Therefore, the electronic retailing market has very intensive competition. How Best Buy survives in this competition is that they have their original loyalty program, which is called â€Å"Reward Zone†. With this program, customers get 1 point for every $1 spending on purchase at Best Buy stores and 250 points is going to be $5 reward certificate. They also e-mail customers when the reward certificates are available. The customers print their reward certificates online or access it with Reward Zone mobile app. Overall Appearance Upon walking into a Best Buy, one can notice the effort they go into keeping their store looking presentable at all times. Not much seems out of place when considering the overall appearance and sanitation of the store, with the few exceptions of items out of place because of customers themselves placing merchandise on the wrong shelf when the item is not needed. This is definitely a place where one can feel comfortable shopping because of its clean and organized environment. When it comes to talking about controversies, Best Buy is no stranger to the issue. Connecticut State Attorney General Richard Blumenthal is investigating Best Buy after it was discovered that some locations throughout the country were using a secret website identical to the public website that everyone can access through www.bestbuy.com, to deny customers of the advertised prices when shopping at the locations. Essentially customers would search for deals on their website and decide what they wanted to buy howe ver; when they arrived at the store to buy the item they were denied the price when a store associate would show them a different price on their secret website. The website looked the same as the public one, but only store associates had access to it, with which they could manipulate customers into paying the higher price. It was also found that locations in New Jersey and Ohio were selling used merchandise as new when they would repackage it, as well as not fulfilling customer  rebates. Controversies such as this show an unprecedented market unfairness not often seen with a major U.S. retailer such as Best Buy. One would think a company as big and with so few competitors such as Best Buy would stray away from bad business practices, but the reality is different. Reflections It is interesting how much we, as a collective team, have learned about Best Buy over the course of our many visits, interviews and research. We have come to the conclusion that Best Buy truly is a force to be reckoned with when talking about electronics. From the customer service, their loyalty programs, variety of products, and down to their reasonable prices. As a group we understand the value of these great qualities, and despite the controversies, we stand as loyal customers to this great brand. Best Buy is a great place to shop for electronics. They have several quality brands customers can chose from. Their products are not an issue in this organization, something they should focus is on is their service. New customers walk in and do not immediately know where everything is. In order fix this issue Best Buy should have a staff member that greets the customers and ask if they need any assistance such as help with looking for a certain brand and product, information on current sales and who to speak with in case of any questions on a product. Cleanliness is not a major issue with the stores, but customers sometimes look through the store items and don’t replace them where they belong so staff should improve on their cleanliness and organization of the items. Recently one of our teammates bought a computer to Best Buy, and being an existing customer she expected to receive good service; however she notices that most of the employees did not help each other and there was a long line at the cashier. No one wanted to help until one employee came up to her and asked her if she needed help. He had confessed to her that no one wanted to do anything because the employees found out that they were not receiving commission anymore. There was a lack of communication with employees and with customers. There were a few employees giving the service, the rest were walking around watching the game. Overall, as far as we have come to know Best Buy, we learned that it is a store with a variety of high quality products. Of course it has its flaws, but which business doesn’t? Best Buy does its best to keep their  reputation as the number one retail store, and provides the consumers with their needs and wants. Best Buy is recognized as the number one store for electronics. When you think of buying an electronic, the first store you think of is Best Buy.