Another popular section seemed to be accessories for mobile devices, although this section seemed to be most popular with young people. I noticed that a lot of shoppers physically examine the products prior to purchase. They read the back of video games and Blu-Rays, and they play with computers and cameras before they purchase. Yet, you cannot really do that much with either of those devices in comparison with how much you would use them in the real world. So there is only limited benefit in playing with those things before purchase. As a marketer, however, that people are willing to handle just about anything prior to purchase indicates that perhaps they like to see and feel things just to give them some comfort in their minds.

4. The idea that Best Buy is Amazon's showroom is hyperbole. Best Buy sells $50 billion a year, and almost all of that is in the U.S. Amazon sells around the world, they sell dozens of major product lines that Best Buy doesn't sell, and they still only do $48 billion. Their share of the electronics market is small compared with that of Best Buy (remembering that of the $18 billion in "electronics and non-media," some of that will be non-media, which is products that Best Buy generally does not sell. The rapid growth of Amazon in general and its electronics business specifically is a threat to Best Buy, but right now Best Buy still has the dominant market share in the industry.

The key to maintaining that share is that Best Buy needs to overcome three distinct disadvantages. The first of those is that Amazon helps the customer more with making the purchase. The recommendations and reviews help support the purchase decision. If Best Buy...

If the customer comes to Best Buy, plays with something, but still needs to go home and read reviews on Amazon before feeling good about the purchase, that is a failing of Best Buy that the store needs to address.
The second major thing that Best Buy needs to do is that it needs to be cheaper than Amazon, and make sure that consumers know that. Both companies have taken different paths to being low cost providers, but Best Buy needs to ensure that it undercuts Amazon, at least on the most visible products. Best Buy definitely needs to undercut Amazon on its website, because that is where consumers are going to make the most direct comparisons between the two companies.

The third thing that Best Buy needs to do in order to maintain its strong position in the electronics market, is to do better customer relationship marketing. Amazon's website is intuitive and builds strong relationships with the customers. It remembers what you have browsed before and offers useful suggestions for things to purchase now. This is not the same experience that one gets in a Best Buy, where nobody ever remembers who you are, what things you're interested in or what else you might be interested in. Best Buy needs to find a way to imitate what Amazon can do in this respect. This might involve building a strong customer database where past information is stored. or, given that it would be almost impossible for Best Buy to replicate Amazon's strength in this area, the company can combat this with a strength of its own, perhaps in personal customer service,…