Best Buy has long been helping its customers transform their digital lives.
In recent months, however, Best Buy has been the one undergoing digital transformation — particularly in the area of store merchandising. Working with One Door, a provider of cloud-based visual merchandising software, the Minnesota-based consumer electronics retailer has expanded its traditionally headquarters-centric, paper-laden process to an efficient, system-wide practice that enables real-time access to data.
“Digital ends up giving everybody in the process a much higher level of visibility and confidence that things are being done properly, and ultimately, that stores are being set the way they want,” says Tom Erskine, chief marketing officer and senior vice president of product with One Door.
“That drives a number of different things. The first is that it drives better sales results, because when people can find what they’re looking for in stores, the stores sell more. Second, it drives less cost in stores because associates know exactly what to do, in less time. And third, it drives less cost at headquarters, because the application enables the visual merchandisers to be five to eight times more effective than they would otherwise normally be.”
OLDER TECHNOLOGIES, NEWER RESPONSIBILITIES
True transformation takes time, and the collaboration between Best Buy and One Door has been no exception. Erskine joined One Door in the middle of 2015, but conversations were already in the works by then.
“The initial entrée was a shared vision around finding a way to improve the communication and collaboration with stores around digital merchandising plans,” Erskine says. “The way they were doing things was pretty traditional — and very non-digital.”
Aaron Pyles, senior director of retail operations for Best Buy, says a need to “simplify the process of merchandising and make it more efficient for our retail teams” was at the core of the collaboration.
“We can tell a better story for the customer by having our product assortment set in a logical and efficient manner,” he says. “By making the process easier to follow, we have seen better execution and reduced the number of merchandising errors.”
Lifecycles of products change rapidly, and new products — especially smart home products — enter the store’s assortment on a regular basis. Effective merchandising, then, is key, especially when it comes to showcasing how these smart home products can make customers’ lives easier.
“We’ve had to make changes in product adjacencies, upgrade internet connections in the stores and create visuals that help customers navigate the complexities of the smart home,” Pyles says. “It’s no longer about just selling a TV. We literally have the incredible opportunity to show how you can control an ever-increasing list of devices in the home with only your voice. You can start a movie on your TV, set the lights to movie mode and double-check to make sure the front door is locked, all without moving from your subwoofer-containing recliner.”
As technology has continued to advance, so has the need to localize and optimize assortments. The challenge for many retailers is decades-old visual merchandising processes that can no longer keep up.
“There’s a widely held misconception within large retailers that when a visual merchandiser or space planner at HQ finishes creating a planogram, and saves it, that they’re done, and the process is over,” Erskine says.
“Realistically, anyone who digs into this realizes very quickly that making good visual merchandising or space planning decisions is one thing, but actually executing those decisions across a large distributed organization with thousands of stores is a whole different matter. In order to effectively transform this process, you have to do both. You have to find ways to improve the decision making, to accelerate it, to make it more local. But you also have to transform the way you effectively communicate those plans and empower the field to do the job.”
One Door had something to offer, and Best Buy came to the table with a time-honored practice of asking, “What would make your job easier?” already in place.
“In addition to the retail networks we have in the field, we regularly travel to different markets with our traveling town halls,” Pyles says. “We invite teams from all areas and from all levels in the stores to come and share what’s on their minds. We hold ourselves accountable for addressing the concerns and vetting the ideas. We get back to each person that has ideas on making the customer and employee experience better with updates and we use those line items as inputs to our roadmaps.”
Both companies approached the project being willing to learn from the other.
“They have helped us become more efficient in our stores and they have shown a clear desire to learn from how things happen in our stores,” Pyles says. “We have good camaraderie, we are learning together and are very collaborative on future development.”
Erskine says one of the most tangible benefits for One Door was that the collaboration led to the development of a feature called Planogram Connector.
“In working with Best Buy early on, it was clear to us that they had a big investment in their legacy planogram software, and it was deeply integrated into the rest of their infrastructure and ecosystem,” Erskine says. “Replacing it as part of the first phase of this project would have been a huge lift. We ended up working with them on a way to import existing planogram data into our application, so they could wrap and renew their existing infrastructure. This capability became our Planogram Connector, now a standard feature of Merchandising Cloud. This was a real thing, not a soft learning, but a hard learning.”
As a company, Best Buy is “focused on talking about what is possible,” Pyles says.
“That means asking customers how they are going to use a product or what they are going to use it for. That shift in moving away from being simply focused on the product itself to the experiences those products can provide will likely accelerate. I think we will see even more connectivity and experiential displays than we already have.”
As for merchandising, “the mobility of the display device is key,” Pyles says. “It provides the information in the moment and at the specific place the work is happening in the store.”
Store teams are no longer tethered to a workstation during store sets. “They have a color visual rendering in the palm of their hands during the set. This helps reduce the back and forth from the floor to the warehouse and shows them exactly how the display is supposed to look when completed.”
As a veteran of enterprise software, Erskine says he has been surprised — in a good way — by the response to the application from Best Buy employees.
“Very often, when you implement enterprise software, the people at HQ have a vision for what it’s going to deliver,” he says. “The end users are sometimes far less enthusiastic. The sense you get is, ‘Here they are from HQ again, foisting a new application on us.’ But in the case of this product, it’s really cool to do a store tour with our team and have the employees that use the application in the field be just as psyched about it as you are.”
Fiona Soltes, a freelancer based near Nashville, Tenn., loves a good bargain almost as much as she loves a good story.