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Best Buy Has the Right Idea

11 Apr, 2005 By: Kurt Indvik

One theme that keeps echoing through the many conferences on digital media, convergence, the digital entertainment household, etc., is the need to educate consumers and simplify the integration of technology.

The evolution in the United States of the convergent media household will be years in the making, but hardware and content suppliers are already creating products and services that consumers can use to create their own individual entertainment experiences. The trend away from mass media and toward personalized entertainment is what convergence is all about. Those retailers who can get in front of that wave can ride it for all it's worth.

Best Buy's recent announcement to ramp up its customer-centric model to all stores in the next few years is a great example. This new model identifies key customer groups, which groups are dominant near each store, and creates a specific product mix, and merchandising and marketing strategies.This program — along with demonstration-heavy store layouts, the Magnolia home theater sections and the ever-growing “Geek Squad” — is helping Best Buy consumers not only pick the entertainment technology (and software) that fits their lifestyles. Most important, it helps customers put it all together for full convergence.

At least that's the goal. And the model seems to be working, as those stores that have been converted to this customer-centricity model have enjoyed significantly higher comp-store sales gains than the rest of Best Buy's U.S. stores, according to fourth-quarter results reported last week.

It's going to take this sort of effort to accelerate the adoption of next-gen entertainment media. While the vision of hardware and content providers for a plug-and-play convergent digital entertainment household is the ideal, the reality is consumers right now and for the foreseeable future need all the help they can get.



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