Best Buy, in its latest earnings report for fiscal 2025, said the retail chain is prioritizing the enhancement of omnichannel experiences by leveraging artificial intelligence and data-driven personalization.
Best Buys said its domestic online revenue of $5.02 billion increased 2.6 percent. Online revenue was 39.5 percent as a percentage of total domestic revenue versus 38 percent last year.
The company is implementing AI-powered search improvements across its website, mobile app, and other digital platforms to enhance customer discovery and engagement. A key focus is on expanding AI-driven personalized home screens, which have already contributed to over 100 million sessions in the fourth quarter. These enhancements are expected to increase customer interaction and drive higher conversion rates.
Additionally, Best Buy is introducing Best Buy Storefronts, which will allow influencers and content creators to establish branded digital storefronts, leveraging their audience to drive traffic and sales. The company is also investing in expanded video content and integrating enhanced data analytics to improve the customer journey across various digital touchpoints.
Best Buy is strengthening the connection between its physical stores and digital platforms by optimizing in-store pickup and fulfillment. Currently, 45 percent of the company’s online revenue comes from in-store pickups, underscoring the importance of physical store convenience. To enhance efficiency further, Best Buy is introducing improvements to speed up fulfillment and refine the customer experience.
The in-store shopping experience is also being upgraded, with new merchandising enhancements such as expanded vendor paths in home theater, upgraded VR and tablet departments, and dedicated spaces for showcasing emerging technology. AI is being utilized in retail operations, enhancing customer interactions and employee training programs to improve staff engagement and overall service quality.
The company is also focused on expanding incremental profit streams by launching the Best Buy Marketplace, a new digital marketplace that will allow third-party sellers to offer products on Best Buy’s platform. This initiative will broaden the product assortment available to customers while leveraging third-party inventory.
Additionally, phased capabilities are being introduced for fulfillment and returns, starting with the ability to return third-party products in Best Buy stores, with plans to expand into fulfillment services in future phases. Digital advertising is another key area of expansion, with Best Buy Ads scaling up opportunities for sellers and advertisers to capitalize on the retailer’s high-intent traffic.
Investments in technology and talent are central to Best Buy’s 2024 strategy. The company is expanding its technology hub in Bangalore, India, to tap into cost-effective talent pools and accelerate its digital transformation efforts. By increasing the scope of work at this location, Best Buy aims to drive innovation while managing costs efficiently. Operational efficiencies and cost management strategies are being implemented to optimize spending while ensuring continued investment in key growth initiatives.
Best Buy is also intensifying its focus on customer-centric digital growth. The company is making strategic marketing and branding investments to boost traffic and engagement, building on the nearly 20 percent growth in app traffic achieved in 2023. Enhancements to its loyalty and membership programs are being introduced to drive engagement and retention across all tiers of the My Best Buy program. By refining its digital and store experiences continuously, Best Buy aims to sustain its competitive edge as the leading omnichannel technology retailer.
Rajani Baburajan
