Is a Price Cut in Best Buy’s Future?
Best Buy typically sets prices for televisions, tablets, smartphones, and other devices based upon, “what is selling online, what is selling in the store, and what is selling with the competition,” said Stephen Gillett, president of digital, global marketing and strategy, in an interview with Bloomberg. So if the retailer does decide to lower prices, it will be to ensure the company is “competitive across those categories.”
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According the average of 19 analysts’ estimates compiled by Bloomberg, Best Buy’s annual revenue could decline for the first time in company history in the current fiscal year. Estimates predict that revenue could fall 2.9 percent to $49.2 billion, based on the competitive nature of the consumer electronics industry.
Since he joined the company in August, Chief Executive Officer Hubert Joly has worked to increase the company’s revenue from online sales, which currently generates only $3 billion. To further this end, Best Buy hired former Expedia (NASDAQ:EXPE) President Scott Durchslag as president of online and global e-commerce on Wednesday.
Durchslag, who will assume the position on October 8, said in interview that offering competitive prices is “just the price to play.”
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