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TK's MORNING BUZZ: Rumored Amazon-Best Buy Deal Could Be a Boon to Both Parties

21 Mar, 2001 By: Thomas K. Arnold

The 'B's have it.

Blockbuster dominates video rental, and now Best Buy appears poised to dominate everything else--sellthrough, DVD, music, you name it. Hot on the heels of its purchase of Musicland Stores Corp., the nation's No. 1 (in terms of total stores) music chain, Best Buy is said to be on the verge of striking a "strategic alliance" with Amazon.com, the Wal-Mart of online retailing.

This deal, which is still in the rumor stage, is said to be structured along the lines of a similar alliance between Toys "R" Us and Amazon.com, in which the Amazon name is peppered throughout toy stores and also mentioned in Toys "R" Us newspaper inserts and TV ads.

If such a deal is, indeed, in the works, it could be a boon to both parties.

Amazon is known far and wide as the biggest Web retailer, but it has yet to become profitable and, according to some analysts, suffers from its lack of a brick-and-mortar presence. Best Buy, meanwhile, already has a quite decent Web site, but so do myriad other b&m retailers -- and this would certainly enable Best Buy to stick up from the rest, particularly if it takes a lead from the Amazon-Toys "R" Us deal and opens a cobranded online shop.

Even if this deal does not materialize, rest assured that Best Buy will soon embark on something similarly grand. Best Buy is on a roll, and the chain seems determined that this roll be seen as continued momentum --and not the roll of the dice.

Comments? Contact TK directly at:TKArnold@aol.com

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