In today’s society, it’s pretty hard to keep up with all the different technologies coming out. As a consumer, it’s hard to decide between whether or not you should buy the iPhone 5, or wait until the iPhone5S. If it’s already tough enough as a consumer, think of it on the suppliers side! With so much access to new technology, we can imagine how hard it is for a company like Best Buy to compete with other third party suppliers such as Future Shop, Walmart, etc… As a result, such competitiveness and similarities in products have caused Best Buy to slip in sales. However, Best Buy’s new CEO is considering one bold move that could save Best Buy and bring Best Buy to a new competitive advantage and brand identity: buy up smaller electronics companies so customers can’t buy them anywhere else.
In a way, this strategy is pretty risky. Because Best Buy is buying the smaller and less demanded brands such as Hitachi and JVC, success rate can be low, considering the fact the trend is to buy either a Sony or the Apple. However, this strategy is also very smart, as it can save Best Buy by giving them a brand identity. Should this strategy go through, Best Buy, to me at least, can be the company that sells the cheaper products for the consumers that can’t afford the Apple, the Sony, or the HP.
By buying out the smaller brands, Best Buy now becomes more exclusive, and becomes the main supplier for these brands.
Interesting to finally see the ‘Brand Positioning & Value Propositions’ lesson from Comm101 being put to work!
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