A recent article in USA Today highlighted Best Buy and how they are moving out of the realm of “guy-dom”. According to Best Buy, women now influence 90% of consumer electronics purchases (a number slightly disputed by the Consumer Electronics Association, which estimates a more realistic 57% influence). As a result, Best Buy has been catering more to female shoppers.
In 2002, Best Buy began executing a “customer centric” plan for their stores. It used 4 different personas to model what they felt were typical customers. The plan started rolling out in a few pilot stores first, with mixed success. Since the initial plan, Best Buy has moved towards one of the personas, Jill (a busy suburban mom), as they focus more on attracting and keeping female shoppers.
From my perspective, the bigger news is the story within the story. A quote from Best Buy’s CEO, Brad Anderson, states that their business strategy is about understanding the needs of individual customers. This is a significant statement, one that gives Best Buy its “Customers Rock!” attitude. By focusing on individual customer needs, they begin to understand what customers are looking for in their electronics purchases. It also enables the move from selling products to selling experiences.
When an organization starts to focus on individual customer needs, they also enable relationships to form with customers. These relationships bring the organization additional information about their customers that competitors do not have. Over time, relevant use of the information in customer interactions becomes a barrier to exit, and customer retention increases.
Will Best Buy be successful with their customer centric strategy? It has been a little bit of a bumpy ride for them so far, but it also seems that corporate results are up and to the right. I predict that if Best Buy stays the course and continues to focus on individual customer needs, they could become the Nordstrom of the consumer electronics retail world. Let it be so!