If you read the popular January Forbes article “Why Best Buy is Going Out of Business…Gradually,” you are aware the large electronics company is losing market share (down 5.3% in the first quarter alone) and facing an uphill battle to stop the financial bleeding. In fact, Best Buy is closing approximately 50 stores before the end of 2012 as part of their efforts to save a projected $800 million dollars over the next three years– money they hope to reinvest in smaller stores like Best Buy Mobile.
Over the weekend, I heard the new Walmart radio commercials that are taking aim at Best Buy. The retail giant is taking a no-holds-barred approach in going after customers in markets where Best Buy is closing stores, inundating consumers with print and radio ads asking the question, “Did your local Best Buy just close?” and suggesting Walmart as the brand that can fulfill their electronics and mobile needs.
As a marketer, I have to applaud Walmart for some pretty smart, if somewhat ruthless, marketing tactics. Going after Best Buy by name in these efforts, not something you usually see by competitors, was a very bold move by Walmart to acquire new customers. However, I couldn’t help but feel a little sorry for Best Buy getting kicked when they are down.
It is no secret that Best Buy has a lot of issues. From executive troubles and an overall poor customer experience to losing the online competition for customers. What if Best Buy made a greater investment in the testing & optimization of their website, perhaps reinvesting their savings into testing rather than smaller store locations? Do you think they could reinvigorate their online business and address one of their biggest business issues head on? Do you think it would be enough?
Let me know what you think in the comments below.