“Best Buy” competes aggressively on price with rivals such as Costco Wholesale, Sam’s Club, Wal-Mart and Target but is also know by consumers for its first- rate customer service. Discuss how you would characterize Best Buy’s competitive strategy. Should

Question

“Best Buy” competes aggressively on price with rivals such as Costco Wholesale, Sam’s Club, Wal-Mart and Target but is also know by consumers for its first- rate customer service. Discuss how you would characterize Best Buy’s competitive strategy. Should it be classified as a low-cost provider, differentiation, or best-cost strategy? Explain your answer.

 

Answer

Best Buy’s major competitive strategies were to emphasize the services, and also anything it has done better in past than any of the national electronics retailers. It translates in to the selling product warranties, or helping with installing the home theatre and configuring the computer. As per the analysts, these services that may have been highly profitable might bring in five percent of company’s $47 billion in the sales in a end of fiscal year February 2010. Company’s blue shirted tech support staffs which has been called as the Geek Squad, expanded by PC-centric services.

 

However at the good times, the electronics retailing may have been brutally a tough business, which has been littered by the failures which had unable for surviving the thin profit margins, the ever-falling prices, the feast-and-famine product cycle & majorly price pressure from the Internet retailers. Best Buy has also suffered with the other retailers at the time of economic downturn, however gained the market share in 2009 holiday season. 

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