The mission; break down the impending demise of Best Buy...
A month ago, I interviewed Lawrence audio/video icon John Kiefer of Kief’s about the sorry state of the area electronics biz and it’s uncertain future in the digital age. As a more-or-less regular guy type dude, it hasn’t been that long since stopping by a Best Buy to pick up a new Green Day or Arcade Fire CD was a normal occurence.
And holiday shopping trips were practically a must.
I did hit Best Buy by a few months back to check out nav systems and see how they looked in real life.
Even at that, how often are people gonna go to an electronics retailer for purchases they only make every so many years? The era of pouring over DVDs and video games on a weekly or even monthly basis is pretty much over with the Walmarts and Nebraska Furniture Marts fully vested in the game.
Besides, how much longer is anybody gonna buy entertainment software anyway?
Remember when going to a CompUSA store seemed like a cutting edge thing to do? I took my kids to the one at 119th and Metcalf not too many years ago on Black Friday Eve (aka Thanksgiving) for a pre holiday sale. Two years later they were dust.
So I was hanging at Aristocrat Motors bash a couple weeks back, talking to Block & Co. honcho David Block about Best Buy. And trying to make the case that it was in shaky shape. David seemed unconvinced.
So I did some digging and found a story about Best Buy’s September earnings slide by Motley Fool, Rick Aristotle Munarriz.
"The struggling retailer can point to success in selling more appliances and mobile computing devices than it did a year ago, but the sum of its parts stinks…" Munarriz wrote. "Best Buy has fallen, and good ol’ blue and yellow can’t get up."
Munarriz went on spell out what Kiefer had been too diplomatic to put on the record.
Beginnng with the headline, "Why Best Buy Is Headed for Extinction"
"If this was just a recessionary lull, it would be easy to play the contrarian and jump on the stock," Munarriz says.
"Unfortunately, the headwinds aren’t going away. Digital distribution is here to stay, and that’s bad news for the rows of CDs, DVDs, books, and video games at your local Best Buy. The company may be perfectly fine selling you MP3 players, Web-tethered televisions, e-readers, and Wi-Fi-backed gaming systems, but these also happen to be the same weapons that wean a shopper from Best Buy itself.
"Think about that," Munarriz continues. "After you buy a portable media player, why would you ever drive out to Best Buy for a CD or a DVD when a digital download is cheaper and more convenient? These aren’t the only examples of Best Buy selling the tools that will lead to its eventual extinction."
And while Best Buy’s Internet biz was up 13 percent for the quarter, that pales to the 51 percent jump posted by Amazon.
"Best Buy is living in denial when it comes to cyberspace…" Munarriz contends. "Keep in mind that this is the same Best Buy that bought Napster and hasn’t been able to grow the music subscription service. This is the same retailer that teamed up with CinemaNow two years ago, and even Walmart’s Vudu has passed it when it comes to digital video.
"Maybe it’s just me, but when stodgy old Walmart is flicking its high beams at you because you’re driving too slow, it’s probably a good time to take the next exit off the information superhighway."
The Fool’s bottom line: "There’s no way out for Best Buy."
Kinda reminds me of when I used to come home from school in Arizona for Christmas and go shopping at Metcalf South. I’d bump into anybody and everybody I ever knew back then.
When’s the last time you went holiday or any kinda shopping at Metcalf South?