Can Microsoft Stores Save Best Buy?
Best Buy (NYSE:BBY) is partnering with Microsoft (NASDAQ:MSFT) in order to open up Windows Stores in 500 retail locations in the U.S. and over 100 in Canada. The stores will range in size from 1,500 square feet to 2,200 square feet and will be run by an additional 1,200 Best Buy Microsoft-trained sales associates.
The partnership is similar to the one Best Buy shares with Apple (NASDAQ:AAPL) and Samsung – with a few key differences. Like the Apple stores within Best Buy, the Microsoft section will showcase a wide variety of their unique products including Windows-based tablets and PCs, Windows phones, Microsoft Office, and Xbox. However, Microsoft Stores will boast a selection of 3rd party products including hardware manufactured by HP (NYSE:HPQ), Acer, Nokia (NYSE:NOK), and other computer and electronic manufacturers. In effect, the new Microsoft Stores will be a showcase of anything and everything related to Microsoft.
The move displays Best Buy’s attempt at increasing sales and turning themselves around amidst considerable uncertainty. Outside observers believe the partnership will be mutually beneficial to both Best Buy and Microsoft. ”I think this is a move that helps Microsoft, in that it will expand into areas of the country that it would not be able to place its current store prototype into economically — while at the same time helps Best Buy fill its Big Box space by effectively renting space out to a valued supplier,” retail consultant Flora Delaney explained. ”Best Buy can continue to claim the high ground with its customers by saying that they support all platforms,” she continued.
Best Buy’s hope is that the unique stores and sales staff will result in increased sales based in renewed customer in new Microsoft products. Best Buy spokesperson Carly Morris told the E-Commerce Times, “There are a ton of new products coming out that are somewhat of a cross between PCs and tablets — like convertibles, detachables, and all-in-ones — most of which are only available at Best Buy. The Microsoft-trained sales associates will play a big role in helping our customers understand how to use these products and how they can help them in their daily lives.”
The question is whether the move will be successful in bringing in new customers. While customers are well-aware of Apple Stores and actively seek them out, the Microsoft Store has yet to capture excitement in the same way. Delaney explained, “Microsoft has not made enough of an impact on the average American consumer to really make their stores a destination.” She continued, “at the end of the day, it is hard to say that there will be much of an impact on Best Buy’s overall business.”
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