This Could Send BBY Stock Skyrocketing
Best Buy Co., Inc. (NYSE:BBY) has just installed a robot in one of its Manhattan stores. It’s not for show or entertainment; it has an actual customer service role, helping buyers find whatever they happen to be looking for. This is a simple step that can pay huge dividends in drawing customers into shops and the strategy will help boost BBY stock. The company’s stock has experienced a rollercoaster ride since the end of August, rising from $29.00 to $38.00 and back down to $30.00.
Nobody Can Deny Best Buy Stock Is Fluid
As Black Friday approaches and consumers wet their electronics-acquisition appetites, Best Buy could see another major growth spurt. Best Buy’s Manhattan shop in Chelsea has set the tone. Its robot, named Chloe, makes it easy and fun for shoppers to locate items; Chloe takes care of everything after the customer asks her to find most things, including video discs, music, movies, games, headphones, chargers, and phone cases. Later, the list of items that Chloe will be permitted to handle will increase. (Source: “I went to Best Buy and encountered a robot named Chloe — and now I’m convinced she’s the future of retail,” Business Insider, October 23, 2015.)
Best Buy has installed this system, consisting of a FANUC robot placed behind glass and a wall of shelves full of products. Touchscreens located in front of the facility are available to customers, enabling them to choose what they want and Chloe puts the item(s) in the customer’s cart.
When a customer places an order, Chloe the robot, placed on a forklift, travels over the width and height of the product wall. She needs only 30 seconds to process and deliver the item to the customer. Chloe, which is equipped with an LCD screen, displays smileys and polite messages to make the experience more enjoyable for even the most cynical of technology customers. (Source: Ibid.)
Best Buy has been testing this automated solution since September. If the experiment is successful, other Best Buy stores will adopt robots. In more general business terms and where Best Buy stockholders are concerned, the robot demonstrates just to what extent the company will go to increase revenue by attracting and retaining customers.
This is because Walmart Stores, Inc. (NYSE:WMT) reassured Wall Street about the health of the retail sector ahead of the crucial Christmas season, reporting a solid third quarter marked by an increased attendance in its stores.
In October, the U.S. group, the world’s biggest retailer, worried investors with warnings that its profits would drop from six percent to 12% in 2016 (fiscal 2017 for the company) due to investments in the online business to compete with rival Amazon.com, Inc. and its decision to increase the minimum wage to 500,000 employees in an effort to improve customer service.
Preparing for the worst, investors were pleasantly surprised to learn that Wal-Mart raised its main annual financial targets just before the crucial Christmas season.
The retail sector has witnessed a series of poor results on Wall Street, weighed down recently by results from Macy’s, The Gap, and even Best Buy itself, among others. However, Best Buy stock has also endured volatility; the company is still reeling with the loss of revenue from the closure of its Future Shop stores in Canada.
As Black Friday, a day that is gathering the same level of popularity in Canada as in the United States as far as sales are concerned, approaches, Best Buy predicts brisk sales thanks to a study the company has commissioned to identify Americans’ appetite for electronic products. (Source: “Best Buy Consumer Survey Reveals Top Tech Gifts for Holiday,” Business Wire, October 22, 2015.) Not surprisingly, among 18–34-year-olds, electronic products have topped wish lists, because they are “more fun” and best fit “what they need” in comparison to other gifts, such as clothes, books, and jewelry.
Of the study’s 2,000 respondents, three times more men than women stated they wished to receive electronic products for gifts, and almost 30% will be giving electronic gifts compared to 16.5% of women.
While “iPad” sales have been rather gloomy lately, Apple’s tablet is the top requested gift, followed by the Bose “QuietComfort 25” earphones and the “MacBook.”
The Bottom Line on BBY Stock
Microsoft Corporation products are in sixth position, just ahead of the Bose “SoundLink II” speaker, the Fitbit “HR,” and the Samsung “Galaxy S2.” The “Apple Watch” is ranked 12th in the list of most desirable gifts. Of course, Best Buy happens to have all of these and Chloe the robot can get them for you. All this should translate to a jolt for BBY stock.