Designed by: Tianlin Liu, Xuezhu Sun IST755

Best Buy Co., Inc. is an American multinational consumer electronics corporation.Best Buy was named "Company of the Year" by Forbes magazine in 2004,"Specialty Retailer of the Decade" by Discount Store News in 2001, ranked in the Top 10 of "America's Most Generous Corporations" by Forbes in 2005 (based on 2004 giving),and made Fortune magazine's List of Most Admired Companies in 2006.Best Buy is in a downward spiral. The company’s stock price is down 50% over the last year and key executives have jumped ship. Strategy Problems: How to be standing out among similiar online shops, like Amazon.

S: Consistently recorded strong growth; one of the best companies in the world because of its sound management.W:Dependence on United States market; Depen-dence on select number of vendors for its mer-chandise.O: New ventures; Bankruptcies.T: Deteriorating Economic Conditions;Highly Competitive Market; Flat panel TVs saturation

Strategic Challenges

LOWThreat of New Entrants

LOW Bargaining Power of Buyers

HIGH Internal Rivalry

MODERATE to HIGH Bargaining Power of Suppliers

MODERATE Threat of Substitute Products

POR TER‛s

5 FORCES

To increase web traffic and web conversion rates, Best Buy is working on enhancing its customer experience by increasing speed, improving inventory availability, and providing better home delivery. It has improved its online shopping site by enhancing its search engine and improving the site’s visual appeal, as well as its content and product price information.

Business Strategy:Renew Blue, Ignite the Possible. Best Buy's aspiration is to create end-to-end customer experiences that allow customers to smoothly and fully experience the possibilities of technology. Evolve the store organization to better support the nature of retail, which is the execution of its category and functional strategies the development and implemen-tation of effective market level strategies that take into account local specificities and lifting its perfor-mance in terms of employee engagement, sales, customer satisfaction and profitability.

There are two challenges that Best Buy will face going forward.First,for Best Buy, this is very problematic since its products are viewed as luxury goods and otherwise unnecessary. The second problem Best Buy will face is increased long-term competition from its discount competitors like Wal-Mart, Amazon.com and other internet retailers. The shakeout in the consumer electronics retail industry has left only several play-ers standing and competition will intensify as com-panies seek to gain market share.Short-Term Solutions:Slow Down Expansion Efforts.Long-Term Solutions:Reinvent the Best Buy “Shop-ping Experience”.