Best Buy has faced one of the biggest turnarounds in the retail industry within the past decade. Former chairman and CEO, Hubert Joly, led the charge towards Best Buy’s much-needed recovery. Joly was the hero the company needed to completely revamp their selling strategy.As Joly did not have a background in retail when he stepped into office in 2012, there was high uncertainty about how successful the revitalization would be. But, Joly stated he loves a challenge, and was ready to step up to the plate. Joly heard advice from colleagues to “cut, cut, cut – close stores and fire people.” However, he decided to listen to employees on the front line, saying don’t make cuts, contrary to what he was previously told. Joly wanted to spark positive energy from within the environment. The company began thinking of itself as more of an organization focused on refining consumers’ lives through new technology, rather than a retailer trying to make a profit.
Best Buy’s niche within the market was overshadowed by Amazon, as consumers could find electronics at lower prices using the online retailer. Joly knew something had to be done with the company’s former retail strategies.
“We took price off the table by giving our blue shirts — the front-line clerks in the store — the authority to match any advertised price. At the same time, we invested in the online experience and the supply chain, so that we were able to ship just as fast as Amazon. To compete with them, we neutralized their advantages,” Joly said.
Joly also noted that, “the world needs Best Buy” because online shopping just isn’t enough for some purchases. Best Buy stores are able to provide a place for consumers to touch, feel, learn, and get professional advice about technology.
The overarching theme of Best Buy’s turnaround was to “treat profit as an outcome, not as the ultimate goal.” The company’s shift towards a human-centric, physical design was highly successful, and their share prices make that clear. Best Buy’s share price, noted Joly, went from a low of $11 a share to about $115, in eight or nine years.
Without a doubt, Best Buy is a poster child for companies that require change. Yet, despite Joly stepping down as CEO in June of 2020, the company continues to succeed and successfully paints the picture for others who may follow their lead into the next generation of capitalism – creating a newfound focus on consumers.
Source: NRF: Hubert Joly on Best Buy’s Turnaround, Best Buy’s Purpose Driven Leadership
Photo Credit: Best Buy Press Center
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About Best Buy
Best Buy Co., Inc. is a provider of technology products, services and solutions. The Company offers products and services to the customers visiting its stores, engaging with Geek Squad agents, or using its Websites or mobile applications. It has operations in the United States, Canada and Mexico.
