Best Buy CEO Joly Against Closing Stores, Doesn’t Consider “Showrooming” a Threat
New Best Buy CEO Hubert Joly reportedly doesn't believe that showrooming—the practice of consumers viewing products in a store only to buy them online at lower prices—is a threat to the electronics retailer.
In a recent interview with the Star Tribune, Joly called the perception of showrooming at Best Buy one of the “greatest falsehoods about our company.”
“If there was a lot of showrooming, I don’t think we would have $50 billion in revenue,” he told the Minneapolis newspaper. “We must have at least a few people buying in our stores.”
Joly also said that he is “not a big fan of shrinking the company” and wants the retailer to maximize sales with its existing stores. He reportedly denied that online retailers, such as Amazon, are a threat to Best Buy, adding that the Richfield-based retailer still has a “stable” share of the market.
Joly, who left the CEO post at Minnetonka-based hospitality company Carlson to take over as CEO of Best Buy earlier this month, spent a good chunk of his first week wearing a blue shirt and working the floor as a salesman at Best Buy’s Minnesota stores.
He told the Star Tribune that Best Buy could sell more small appliances and expand into home security through its Geek Squad unit. The company also has reportedly discussed opening an app store that will offer digital content like movies, music, and television shows.
Joly joins Best Buy at a time when founder and former Chairman Richard Schulze is attempting to take the company private. Schulze and Best Buy recently reached a deal that grants Schulze access to the company’s non-public financial information in order to put together a formal buyout offer.
Meanwhile, Laura Kennedy, an analyst with consulting firm Kantar Retail, was reportedly puzzled by Joly’s remark about showrooming. Kennedy told the Star Tribune that “there’s plenty of evidence of people doing that.”
Kennedy reportedly wonders if Joly is trying to appeal to Schulze, who claims to have recruited former CEO Brad Anderson and former Chief Operating Officer Al Lenzmeier to serve on his management team. Schulze's and Anderson’s history at Best Buy reportedly suggests that the two are against closing stores and also want to focus on sales growth.
To read the full Star Tribune story, click here.