When Best Buy speaks, I listen. The company seems to be ahead of the retailing curve in terms of producing an innovative customer experience. Back in September, I posted about Best Buy’s personal shopping assistants and kitchen design service. There’s been a lot of talk about the company’s in-store customer centric initiative. Over the holiday shopping season, the company pushed it’s in store pick up service with great success.
Sam Taylor, Best Buy SVP Online Stores & Marketing, discussed some of his strategies for success with multi-channel retailing. This is not an interview (no direct quotes), just what I picked up from his talk.
Sam equated the normal multi-channel retailing situation to a sandbox. Kids play nicely at first, but ultimately, some kind of conflict comes along. The secret is sharing. Analogy to your organization: Are people pointing fingers? Is there an internal channel conflict? Do you hear people say things like…you shouldn’t be on our P&L…there shouldn’t be online only promotions…or from the other perspective…we’re the younger, smarter brother, we’re growing faster, etc.
It’s about sharing:
1. Share the money.
-All the stores get credit for the revenue and profits from BestBuy.com.
2. Share the data between the different channels.
-For example, we break out web analytics by different customer segments on the web and share that data with the stores (for instance, on the web, BB can see a certain segment looks for Star Wars, WWE, Webcams, etc.). One store manager put this data to use and wrote: “We couldn’t be more pleased with the results. On the release of Star Wars, we put out titles from your list on a third table. We were 198% to revenue as well as one of the top stores in UPT. The ‘segment table’ has about 70% sell through strength.”
3. Share the experience and solution for the customer across the channels.
-For example, more than 50% of houses with multiple pcs don’t have a broadband network or can’t get the network to work. The BB response was the acquisition of Geek Squad – it addressed a real customer need. Geek Squad is the first 24/7 customer support task force. Founded in 1994 and acquired by BB in 2002. There are now over 10,500 agents in North America. In home, in-store and phone support – you have to be where your customers want you. From the website: “Geek Squad can set you free with a wireless network. Once set up, you can share your high-speed internet connection with every PC in your home. That means you can browse the web from your laptop in the backyard, print from your couch or e-mail work while still in bed.”
-Another example is the Magnolia Stores integration with Best Buy. Magnolia provides home theater product knowledge, service, and installation expertise. The company has over 1,300 installers in North America.
-In store pick up. Customer wins (no waiting for delivery, no shipping charges, convenient). Best Buy wins (40% higher average order value, 20% make additional in-store purchases, 65% are new to BestBuy.com, competetive advantage – the only store that offers in store pick up for movies, music, and games).
Locking in Your Customer – September 13, 2005