In 2012, Best Buy was struggling. Sales and profits were declining, the stock price was plummeting and pundits were predicting the company’s demise.
But then, in what would be a major turning point in Best Buy’s history, the company hired Hubert Joly as CEO. Over the next seven years, he led the company through our successful Renew Blue transformation, which resulted in improved customer satisfaction, market share gains, revenue growth and improved margins.
Now, Hubert is moving into the newly created role of executive chairman as part of a planned leadership transition. Corie Barry, a longtime Best Buy executive who is currently the company’s chief financial and strategic transformation officer, will take over as CEO on June 11.
“Working together, we turned around and then began growing this wonderful company, and it has been the honor of my professional life to work with all of you as we did this,” Hubert told employees during Best Buy’s recent first-quarter earnings call. “The company is in good hands with our new leadership and the depth of talent we have, and I am confident that the journey we began in 2012 will continue well into the years ahead.”
Here’s a closer look at what we’ve accomplished under Hubert’s leadership.
Reconnecting with our customers
We reconnected with our customers by improving their experience however how they chose to engage with Best Buy. That included implementing a price-match policy and making significant investments in our online and in-store shopping experiences.
We’ve had five straight years of comparable sales growth, more than doubled our U.S. online sales to $6.5 billion and dramatically improved our Net Promoter Score.
Under Hubert’s leadership, we also launched our In-Home Consultation program, which provides free in-home technology consultations, and Total Tech Support, which provides 24/7 support for all of a customer’s technology regardless of when and where they bought it. We also formed Best Buy Health and acquired GreatCall, a leading connected health services provider for aging consumers, to accelerate our strategy to help seniors live longer in their homes with the help of technology.
Investing in our employees
The enthusiasm and talent of our employees has played a key role in our success with customers. Over the past several years, we have invested in our workforce in several ways, including enhanced employee training that has won praise and awards for its quality and expanding employee benefits to include paid caregiver leave, expanded mental health benefits, paid time off for part-time employees and backup child care.
The payoff is that our employee engagement scores are at near record highs, and employee turnover rates in our stores are at record lows.
Partnering with our vendors
We continue to partner with the world’s foremost technology companies. Over the last seven years, our vendor partners have invested with us to create stores-within-store and other unique customer experiences. We ended fiscal 2019 with more than 5,000 of these experiences throughout our U.S. locations.
Last year, we announced an exclusive multiyear partnership with Amazon to bring the next generation of Fire TV Edition smart TVs to customers in the United States and Canada.
Creating value for our shareholders
We’ve had five consecutive years of comparable sales growth and increased our non-GAAP operating income rate. Meanwhile, we achieved $1.9 billion in cost savings and efficiencies to help fund investments and offset pressures in the business.
As a result, Best Buy investors have seen significant value during Hubert’s tenure as CEO. We improved our profitability and returned capital to shareholders through dividend payments and share buybacks. Since the end of fiscal 2013, our total shareholder return is 335%, compared to 104% for the S&P 500.
Supporting our communities
At the core of our turnaround and growth strategy was the decision to operate the company with the belief that we will do well by doing good. Specifically, we have sought to be a responsible corporate citizen.
As it relates to our impact on the communities in which we work and live, and the planet more broadly, we have focused on three initiatives.
- Expanding our Best Buy Teen Tech Center network: With our partners, we’re well on our way toward opening 60 Best Buy Teen Tech Centers as part of our broader effort to train teens from underserved communities for the tech-related jobs of our modern economy.
- Reducing our carbon footprint: We have reduced our carbon footprint by 51% (over a 2009 baseline) and expect to meet our pledge of 60% by 2020.
- Recycling: We operate the largest consumer electronics recycling program in the country and are on track toward meeting our goal of recycling 2 billion pounds of electronics by 2020.
All of this work has been recognized through a number of awards this year, most notably being named No. 1 on Barron’s annual list of the 100 Most Sustainable Companies.
This article includes information from Hubert’s annual letter to shareholders. Click here to read the full letter.