Digital Franchise: E-commerce strategy for Best Buy
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How Best Buy could switch from expensive retail business to e-commerce? How company can lead digital market?
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Digital Franchise: E-commerce strategy for Best Buy
- 1. Confidentiality Statement - The content of this document is intended for the exclusive use of the recipient and may contain confidential or privileged information. If you are not the intended recipient, you are strictly prohibited from reading, using, disclosing, copying, or distributing this document or any of its contents. If you received this document in error, please permanently delete this document, along with any copies thereof. Created: October , 2012 Last update: April 2014 Ivan E-mail: strivanlab@gmail.com Cell: +1 (416) 890-0037 Skype: ishmelev Toronto, Canada Digital Franchise e-Commerce Strategy
- 2. 50.71 49.14 42.41 38 40 42 44 46 48 50 52 2011 2012 2013 Best Buy business is slowing down Big Box store expansion is costly with high CAPEX, OPEX and long-term ROI Current e-commerce strategy: Company sells through its own web-store offering the prices matching, free home delivery and social features Those initiatives are not enough to lead the e-commerce market, because competitors offer the similar products and services Need in Digital Strategy Revenue -3.1% -13.7% BestBuy.com visitors Flat % change in online sales 25%
- 3. Digital Franchise - platform allowing entrepreneurs easy to launch their own e-commerce store to sell goods supplied by Best Buy Fast e-Commerce Expansion One e-store Thousands customers Millions CUSTOMERS Thousands e-stores VS
- 4. e-Commerce Evolution Branded e-Store Affiliate Program Digital Franchise Company sells goods through its own web-site Partners use their own sites to sell goods supplied and delivered by the retail Retail branded e-store launched and fully operated by partner Affiliate Program Digital Franchise Strategy Bring all sales to one site Split sales to many sites Partners Bloggers/Publishers Entrepreneurs, Experts Function Advertising Sales, Delivery, Support Brand Partner`s brand Single retail brand Delivery By supplier By partner Technology Site developed by partner Site developed through retail took
- 5. Platform CRM ERP BILLING Tools Development kit Franchise Supply Warehouse Support Processes Services PR/Marketing Financing Customer database Price and availability Payment system Tool to launch e-store Loans and finance services Guarantee, return Logistic, supply, wholesale License, certification Branding, rewards, promotions, advertising Storage, package ConsultingManagement, finance, strategy, marketing other Other services
- 6. Case: Networking Equipment e-Store Entrepreneur Profile: Charles is a engineer with an expertise in electronics and network devices. He is an expert who needs an extra income. Current activity and services: He buys the modem/routers and sell them through: - Personal web-site: www.charleslidstone.com - Classified sites: Craiglist, KiJiJi, e-Bay - Neighbors, colleagues and friends He provides following services: - Installation, configuration and maintains - 24/7 availability at home, mail or deliver - Professional recommendations and help - Guarantee and repairs Digital Franchise case (example): 1. Designed e-store using the Developer Kit from Best Buy 2. Orders and stores the most popular models at home 3. Receives orders and meets customers 4. Provides customer support
Editor's Notes
- http://strategyonline.ca/2012/08/28/best-buy-canadas-bold-plan-to-stay-1/
- Best Buy Forced to Rethink Big Box : http://online.wsj.com/article/SB10001424052702303404704577311322427071212.html Best Buy to Match Online Prices http://online.wsj.com/article/SB10000872396390444657804578050864206903402.html
- http://strategyonline.ca/2012/08/28/best-buy-canadas-bold-plan-to-stay-1/