Best Buy CEO Hubert Joly: "Ten years ago at Best Buy, we thought 'Amazon will kill us'"
Last week, Best Buy CEO spoke at the Adobe Summit in Las Vegas about the company's digital transformation over the past decade, and what's next for Best Buy.
Hubert Joly is Chairman and CEO of Best Buy. He joined the team in 2012, and has led the company through some important digital transformation. Last week, Joly spoke at the Adobe Summit in Las Vegas, interviewed by Adobe’s CEO, Shantanu Narayen.
(Photo by Jeff Bottari/AP Images for Adobe)
Joly began by discussing Best Buy’s journey competing against Amazon.
“Ten years ago at Best Buy, we thought “Amazon will kill us.”
What did Best Buy do to stay competitive against Amazon?
- Price matching — they’d match any veritable price found on Amazon.
- Delivery — they delivered just as fast.
- Customer experience — via their employees.
- Become good global citizens — by reducing their carbon footprint, giving to charitable organizations, and similar efforts.
“Building the new blue” — Best Buy’s campaign to reinvent the company
First, Best Buy launched a much-publicized “Renew Blue” campaign, which was about reviving the company. Now they’ve moved on to reinventing its future trajectory. They call this campaign “Best Buy 2020: Building the New Blue.”
“Our purpose is to enrich lives with the help of technology. Not to sell products to you.”
So what are they doing to reinvent themselves?
- In-home advisers. Any of us can call Best Buy for a free, in-home consultation about our space and what will work with our existing devices.
- Evolution of the Geek Squad. We can sign up to have Best Buy experts do in-home repairs.
- “’Honey what is it, can you fix it?’ –> We are honey. For $200/year, we will fix anything in your home, even things that are not from Best Buy.”
- Helping aging seniors stay in their own homes longer, reducing overall health care costs.
- Best Buy can put monitoring devices in homes to detect if an emergency happens.
Truly, they’ve come a long way from just selling TVs.
Digitization of customer journeys
“Seven years ago, 80% of Best Buy’s media spend was mail. Now, 90% is digital.”
Being able to put the customer journey together with single customer ID is foundational. Now, the company focuses on optimizing all communication — how much, to whom, what time of day. etc.
Even their in-home advisers are equipped with customer support, Joly says.
This is a company with hundreds of thousands of employees, and thousands of stores.
And yet, according to Joly,
“We don’t see ourselves as brick and mortar retail. We see ourselves as obsessed with customers in a way that truly solves their unique problems.”
What’s next for Best Buy?
Mainly, building this new blue, Joly says. Continuing their transition toward developing and selling solutions over just products.
And moving forward, metrics are continuing to change. Instead of just asking “how many customers do we have?” the new order of questions is:
- How many households live in this market?
- How many are already customers?
- And how many do I have relationship with?
Most of all, Joly emphasized:
“Our purpose is not to make money. Making money is an imperative — we have to make money. Our purpose is something else — something meaningful to be part of.”
