Missi Varner Case Analysis Week 3

Missi Varner Case Analysis Week 3 - Missi Varner Marketing...

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Missi Varner Marketing Case 3 Best Buy Uncovers Angels in the Market Case Summary Best Buy is retailer of consumer electronics, home-office products, entertainment software, appliances, and related services. One of their main goals is to make life easier and more fun for consumers. To obtain this goal, the company's retail environment focuses on enlightening customers on the benefits of technology in the entertainment product market. This case discusses Best Buy’s method of discovering the wants and needs of its customers. To do this, they developed a database that integrated information from 19 customer touch points and enhanced it with Experian's INSOURCE consumer marketing data to develop a complete portrait of a Best Buy customer. To gain further insight about what its customers wanted, Best Buy used secondary sources from transactions, mailing lists, and demographic information from local census numbers, surveys of customers, and targeted focus groups to collect data. “INSOURCE helps us get deeper insight into our customers,” Anglum explains. After enhancing customer data with INSOURCE marketing information, it’s possible for Best Buy to better understand the types of products its customers will be interested in. For example, customers buying video games may have children and may soon be in the market for a Walkman®, an MP3 player or other popular personal electronics. After appending age, presence of children information and other relevant data to their customer database, it’s possible for Best Buy to segment consumer groups for the most appropriate offers. Best Buy’s comprehensive customer database also enables operational efficiencies such as quickly producing duplicate receipts for returns or repairs, and validating a customer’s current address for home- delivery of merchandise. From this data, Best Buy was also able to categorize their customers into two groups, the angel customers and the devil customers. The angels were customers who bought high- definition TVs, portable electronics, and newly released DVDs without waiting for markdowns or rebates. The devils bought products, applied for their rebates, and then returned the products and bought them back again at returned-merchandise discounts. The company launched the initiative with 67 stores, each of which would analyze the demographics of its local market and then choose one or two of these groups to be their focus. Executives believe that this model offers its angel customers a richer in-store experience, including better shopping assistance, and provides more of the goods and services that they are looking to purchase. Personal shopping assistants were also provided to assist customers from the moment they enter the store until they reached the express checkout. Best Buy has already transformed 85 stores to the new customer-centered model and plans to convert all of its U.S. Best Buy stores within three years. The 67 stores that underwent conversion in 2005 have reported a considerable 8.2% gain in revenue in comparison to the standard Best
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This note was uploaded on 07/08/2011 for the course BUSN 5760 taught by Professor Ukn during the Spring '08 term at Webster.

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Missi Varner Case Analysis Week 3 - Missi Varner Marketing...

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