The Great Recession and Internet comparison shoppers forced airlines and travel agencies to rapidly revamp their business models or die.
Now consumer electronics giant Best Buy is attempting to transform its business strategy by tapping two prominent executives who reshaped the travel business.
Hubert Joly, who became Best Buy’s new CEO the day after Labor Day, was viewed by analysts as a surprise choice because he didn’t come from the retail environment. He was lured to the Best Buy post after serving as the chief executive of Carlson Wagonlit Travel.
This month, Best Buy hired another travel-industry leader, Scott Durchslag, who was president of Expedia Worldwide, the world’s largest online travel agency. Durchslag will be president of Best Buy’s Online and Global e-Commerce.
At Carlson and Expedia, Joly and Durchslag needed to define the different segments of travel consumers, identify what types of services they wanted, and create revenue streams in a highly competitive industry that could sustain their businesses. Expedia differentiated itself from individual airline websites, and Carlson provided an array of services for corporate travel clients.
Speed is crucial
In the airline and travel industry, speed in management decision-making is crucial because competitors are changing prices on a daily basis and constantly upgrading technology options to increase consumer choices.
As Best Buy faces intense competition from online and discount retailers, the two travel executives are now poised to use the lessons they learned to try to turn around Best Buy’s financial performance.
Heading into the critical holiday shopping season, Best Buy disclosed Friday that its front-line employees will have the ability to match prices on Amazon.com and with other competitors. Best Buy also is moving forward with opening smaller Best Buy Mobile stores to capture customers who aren’t fond of a big-box experience.
While Joly crafts a refined business strategy for Best Buy, he continues to build his leadership team. The company is searching for a chief financial officer after announcing last week that CFO James Muehlbauer would depart by February.
While an executive shuffle is taking place in the corporate offices, the company’s ownership remains uncertain. Best Buy founder Richard Schulze is still pursuing a buyout of the public company.
Attention to the message
But the company’s current management doesn’t want to allow Schulze’s actions to dominate news coverage. Best Buy recently hired an experienced and well-known public relations veteran to join the team that’s shaping Best Buy’s transformation message.
Amy von Walter joined Best Buy in September as senior director of corporate public relations after serving in key communication roles at Medtronic, HealthPartners and Target. But like Joly and Durchslag, von Walter also understands the dynamic travel industry. She gained her insights about airline consumers from a governmental vantage point. She previously worked for the Metropolitan Airports Commission and the Transportation Security Administration.
Airline and travel consumers care about product prices, quality of services, hassle factors and high-quality online sites. In the electronics arena, Best Buy’s customers have similar priorities. Best Buy’s new leaders with travel-industry pedigrees now have the opportunity to apply their experience to help Best Buy succeed in the online and bricks-and-mortar worlds.
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