Discover its feminine side
Though people normally associate flat-panel televisions and subwoofers with boys and their toys, consumer analysts say female shoppers are increasingly driving sales of personal electronics. Retail consultant Burt Flickinger says Best Buy should hire more women, especially at the store level. For example, Best Buy beefed up store staffs to sell more televisions leading up to the Super Bowl. But the retailer failed to exploit the next big television event, the Oscars, which attracts primarily women, Flickinger said.
Key point: 61 percent of women influence household decisions for consumer electronics purchases, according to she-conomy.com.
Speak louder on Internet sales tax
Online outfits like Amazon enjoy a clear price advantage over brick-and-mortar retailers like Best Buy because they don't have to collect sales taxes. Bills that would force Amazon and other online retailers to do so have consistently stalled in Minnesota and Washington, D. C. Like many retailers, Best Buy prefers to do its lobbying through trade associations. But with more than $50 billion in annual sales, Best Buy can and should pour more financial and vocal muscle into the debate, starting with its home state, analysts say.
Key point: Internet retailers can offer prices up to 7 percent cheaper in states that don't collect online sales taxes, according to JPMorgan.
Speed it up
Best Buy faces a daunting challenge: how to transition to smaller-store formats without losing too much of the sales and profits it has long enjoyed with its big-box buildings. Investors were underwhelmed with the company's recent restructuring plan, which calls for Best Buy to save $800 million over three years through job cuts and the closure of 50 big-box stores. At the same time, the company said it will open smaller Best Buy Mobile stores and experimental Connected Stores.
Key point: Best Buy could ultimately close as many as 250 big-box stores over the next few years, said David Strasser, an analyst with Janney Capital Management.
Improve the website (and mobile sites, too)
Best Buy's website malfunctioned during last year's key holiday shopping season, costing the company much-needed sales and credibility. The company's online presence is also less than stellar on smartphones and tablets; one Google official called it "astonishingly bad." Analysts expect a BestBuy.com overhaul will be the first priority of new digital chief Stephen Gillett, who previously served as chief information officer for Starbucks.
Key point: Best Buy wants to boost e-commerce sales by 15 percent this year.
New CEO should come from the outside
G. "Mike" Mikan, a Best Buy board member, is campaigning hard for the job, sources say. But investors want to see the company recruit someone with no previous ties to Best Buy, preferably with strong experience in technology and retail. Such a person would signal to Wall Street that Best Buy really seeks a fresh start.
Key point: Best Buy has had only three CEOs in its 46-year history, all of whom toiled in the stores: founder Richard Schulze, Brad Anderson and Brian Dunn.
Sources: Retail, investor and consumer analysts