When was the last time you shopped at Best Buy for the experience? If you’re like me you go to Best Buy for the selection of consumer electronics devices and reasonably low prices. The experience is the last thing on my mind. In fact, a trip to the giant electronics retailer can be downright frustrating. The staff simply isn’t trained to provide an exceptional experience. They are trained to move merchandise and sell add-ons, which is probably why I spend less and less time there. Clearly I’m not the only one. Best Buy is in trouble as profits plunge along with its share price (Forbes staff writer Steve Schaefer does a nice job of covering Best Buy).
This week Best Buy hired a new CEO, Hubert Joly, a hospitality executive. Joly was the CEO of Carlson, parent company to Radisson and T.G.I Friday’s brands. Although Joly has had success as a turnaround expert, there’s no question he has an uphill climb at Best Buy as it faces competition from online retailers. But since Best Buy cannot compete on price anymore, it must reinvent the customer experience. In other words, it makes perfect sense to hire a person who understands customer service and who has had success in the hospitality field.
I’m confused by retail analysts who question Joly’s appointment because he doesn’t have direct experience in retailing. According to this article in the Wall Street Journal, Wedbush Securities analyst Michael Pachter was shocked by the pick. Pachter said Joly was “completely unqualified.” Keep in mind that most retail analysts—the experts—dismissed the Apple Store as a misguided experiment. But Apple understood something about human behavior—people don’t want to be sold to. They want to feel good.
Successful hospitality experts make people feel good. They put a smile on your face. Best Buy needs to get in the business of making people feel good about their stores and services. If I know that the next time I visit Best Buy I’ll walk out with a smile, the brand will be much more likely to win my loyalty.
If you’re still not sure about the connection between hospitality and retail, you might be interested in watching this video I posted on the Forbes video channel about The Ritz-Carlton and how it influenced the Apple Store, the most profitable retailer in America.
Successful hospitality executives know that the customer experience goes well beyond price. The way people are hired, trained, motivated, and taught to communicate with customers all play a role. Best Buy needs a radical reinvention. Joly might be the right man for the role.