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Best Buy ‘Rents Space’ to Samsung Within Changing Market

February 27, 2014 - Written By Cory McNutt

Retail sales have slowly, but steadily, changed over the past few years – slowly enough that retail brick and mortar stores have had plenty of time to react and steadily enough that there was no way they could not see it coming. So when our huge Circuit City store suddenly closed and our JCPenneys said they were downsizing and our local Sears store closed – I was at first saddened, but then got angry at them for letting this happen. With online buying at an all time high and more and more people price shopping on the internet, didn’t they notice that their in-house traffic was slowly disappearing and sales dwindling?

Stores and malls are turning to ‘beacons’ that will send out specials to your smartphone as you approach those item specific areas in the stores, hoping to throw you a ‘bone’ to entice you to make a purchase – the only problem with this system is that you need to be in the store or mall’s vicinity, not sitting at home buying off the internet. I buy 90-percent of everything on the internet as I simply do not want the personal and physical contact of everyday store shopping – I want in and out so I can do other things. On rare occasions I do like to see and touch my potential purchase BEFORE I buy the item, and this is where Best Buy, Samsung, Microsoft, and yes, Apple have changed to meet our ever-changing shopping habits.

Apple actually pioneered the idea many years ago by constructing their own stores so a person could walk-in, sit down, and play with their products. Best Buy has taken a page from their book and started to section off their stores and allowing these major competitors their own ‘space’ so to speak. If a tech customer is interested in experiencing these products in person, then Best Buy is the place to go – and Best Buy is banking on that.

In presenting their fourth quarter earnings, Best Buy had good and bad things to report.  However, one thing that came out of their presentation about their 1,495 retail stores is when they detailed about their future:

“Third, and very important for our future, we have enhanced how we serve our customers and have been building key foundational capabilities. Most notably, we have: (1) increased Domestic online sales by 20%; (2) significantly increased our price competitiveness; (3) rolled out ship-from-store to more than 1,400 locations; (4) opened 1,400 Samsung and 600 Windows stores-within-a-store and completed the first phase of our floor space optimization…”

Samsung started this partnership with Best Buy  and the store within a store concept less than a year ago and they already occupy 1,400 Best Buy stores and this now makes Best Buy THE place to go if you want a true Samsung experience. The stores are no longer row after row of wire racks, but big open spaces with an oasis of bright displays that showcase the major Android brand, Samsung. These changes along with encouraging online sales and cutting prices is exactly what Best Buy needed to do in order for them to survive, and we are thankful they had the foresight to make these changes in the way they do business so we will still have an electronics store to visit and play in.

Let us know on our Google+ Page if you shop at Best Buy and have noticed the changes in their stores – do you like the changes?