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Organizations, such as Best Buy, need to objectively identify their strong points and determine how they can be used to react to the larger market. Michael Porter came up with three generic strategies to give businesses that competitive edge or advantage in their various product-markets. These are: (1) overall cost leadership; (2) differentiation; and (3) focus. “ Ormanidhi concurs and states that if firms pursue any of Porter‘s three recommended generic strategies, they will be able to outperform competitors who do not pursue such strategies” (Monahan & Rahman, 2011, p.
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They are shutting down many of their stores due to high overhead costs and low sales. Their competitive strategy is to create a diversified market by keeping the stores that are doing well so that their loyal customers still have a place to go to, while boosting internet transactions for the customers that prefer a more personal way of shopping. As Michael Porter points out, “A company can outperform its rivals only if it can establish a difference that it can preserve. It must deliver greater value to customers or create comparable value at a lower cost, or both.” (Mullins & Walker, 2010). The competitive advantage that Best Buy has is the different market places that consumers can go to - online as well as brick and …show more content…
Prior to the holiday season, Best Buy “beefed up its online campaign to fight off intense competition from online retailers and discount stores. And the holiday season is crucial for retailers like Best Buy because it can make up to 40 percent of annual sales” (Anderson, 2011, para. 4). Unfortunately, they were unable to execute the confirmed orders due to lack of products in the warehouse and told the customers who had paid that they were no longer able to follow through with the order. The company had their chance to create online sales, but the online experience for consumers needs to be improved if they want to keep their name in the electronics market. By providing free shipping and price matching they can improve their ability to compete against other online merchants.
They are shutting down many of their stores due to high overhead costs and low sales. Their competitive strategy is to create a diversified market by keeping the stores that are doing well so that their loyal customers still have a place to go to, while boosting internet transactions for the customers that prefer a more personal way of shopping. As Michael Porter points out, “A company can outperform its rivals only if it can establish a difference that it can preserve. It must deliver greater value to customers or create comparable value at a lower cost, or both.” (Mullins & Walker, 2010). The competitive advantage that Best Buy has is the different market places that consumers can go to - online as well as brick and …show more content…
Prior to the holiday season, Best Buy “beefed up its online campaign to fight off intense competition from online retailers and discount stores. And the holiday season is crucial for retailers like Best Buy because it can make up to 40 percent of annual sales” (Anderson, 2011, para. 4). Unfortunately, they were unable to execute the confirmed orders due to lack of products in the warehouse and told the customers who had paid that they were no longer able to follow through with the order. The company had their chance to create online sales, but the online experience for consumers needs to be improved if they want to keep their name in the electronics market. By providing free shipping and price matching they can improve their ability to compete against other online merchants.