Best Buy site rebuild not yet ready for prime time

Best Buy (NYSE:BBY) was plagued with system problems on the all-important Black Friday, causing the retailer to take its website offline twice during the day.

The company line on this is, " experienced record levels of website traffic. This affected site performance and we temporarily took the site down in response," according to a Best Buy spokesman.

Best Buy's website and online operations were segregated out from the overall operation until CEO Hubert Joly took the helm in August 2012 and in 2013, commenced a two-year rebuild of the website.

As FierceRetailIT reported in March 2013, the retailer's multiple websites were unintegrated, effectively making multichannel retailing impossible. The short term solution was to patch up the current sites until a completely new e-commerce platform could be launched.

This process would take a couple of years, said Joly at the time, and clearly it's still a work in progress.

During Best Buy's third quarter conference call on Nov. 20, Joly pointed to several customer-facing site improvements leading into the holiday season, "including significantly richer visual and editorial content for the home theater, mobile, appliance and gaming categories, expanded 'wish list' capabilities, an expanded inspirational holiday gift center, and an improved checkout process that provides faster and precise 'get it by' delivery dates on approximately 60 percent of Best Buy delivered SKUs rather than up to five to eight day range."

Online is a growing part of Best Buy's business. For the third quarter, especially, the retailer's ship-from-store program is growing, an effort that has been expanded for this holiday season. Ship-from-store, expanded digital marketing and enhanced website functionality has helped to drive a 22 percent increase in U.S. comparable online sales, said Joly. Year to date, ship-from-store accounts for more than half of this growth.

But the site rebuild and rollout is still pending, and Best Buy is still apparently cobbling together improvements to its existing platform. In November, Joly mentioned online shopping experience improvements such as additional product category redesigns, expanded wish list capabilities and improved checkout processes.

"Of course we will also be continuing a significant behind the scenes work on the transformation of our e-commerce platform," he told analysts during an earnings call in August.

Best Buy has had four consecutive quarters of more than 20 percent online growth and 11 consecutive quarters of double-digit online comparable store growth in the United States. Percentage of sales from online operations was less than 10 percent of Best Buy's total sales midway through this year, but it's growing fast. Perhaps too fast for the existing systems to handle.

For more:
-See this FierceRetailIT story
-See this SeekingAlpha conference call transcript

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