Keen On… Larry Downes: Why Best Buy Is Going Out Of Business (Not So Gradually)

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Sometimes it’s the quiet ones who end up doing the most damage. I always thought of Larry Downes, the co-author of the mega-selling Unleashing the Killer App, as an unusually gentle and wise soul. But this was before Downes unleashed his all-too-critical powers on Best Buy, transforming himself from a cerebral author into a bomb throwing critic of America’s leading consumer electronics retailer. In Why Best Buy is Going out of Business…Gradually, a brilliant article he published at Forbes last month, Downes finally told the truth about the terrible customer service at Best Buy. And the article went viral, of course, amassing close to 3 million page views and even forcing Best Buy CEO, Brian Dunn, to issue a response.

Best Buy is committing a “huge strategic blunder” in thinking their service is any good, Downes told me when he came into our San Francisco studio last week. The retailer, he explained, offers neither the lowest price nor provides decent customer service. It’s thus stuck in retail no man’s land – caught  in that dead zone between big box retailers like Walmart and high-end operations like the Apple stores. Worse still, Downes explained, Best Buy’s service stinks so badly because it trains its staff in how to sell rather than in making customers happy; thus, these staff are trained in up selling and cross selling which explains, he says, why most of their carefully scripted encounters with customers are so unpleasant.

So what is to be done? Downes laid out three solutions to reinvent Best Buy: 1) Integrating their on and offline operations; 2) Making the stores fun; 3) Radically changing the in store product mix. But can Best Buy really be saved? I wonder whether its business model might be so antiquated and the experience of shopping in its stores so miserable that its demise might be even more imminent that even Larry Downes predicts.

TechCrunch Gadgets editor John Biggs wrote about whether Best Buy is really finished last month.