Best Buy CEO Dunn steps down as shoppers move online

RICHFIELD, Minn., Tue Apr 10, 2012 – Best Buy Co. CEO Brian Dunn has left the world’s largest consumer electronics chain, which has struggled against stepped-up competition from internet retailers and discounters.

Under Dunn’s tenure, which lasted less than three years, critics have complained that Best Buy became a showroom for Amazon.com and other Internet retailers, with consumers going to Best Buy stores to sample electronics like high-definition televisions, but then buying them elsewhere at lower prices.

The company, seen as a bellwether in the consumer electronics industry, reported declines in same-store sales in six of the past seven quarters, including during the 2010 holiday season, when it made a bad bet on technology like 3D television that consumers did not embrace.

Despite offering bigger discounts and free shipping to lure shoppers in the 2011 holiday season, same-store sales fell 2.4 percent in the latest quarter, including a 2.2 percent decline at U.S. stores open at least 14 months.

“I hate to be rude, but I think he (Dunn) was doing a terrible job. This is a company that had a sales guy in charge, and I just don’t think they are well-positioned to deal with the onslaught from the Internet,” said Michael Pachter, analyst at Wedbush Securities.

“They have a big disadvantage to the Internet retailers because they have a big cost structure. So they need a guy who can fix that rather than trying to sell more stuff.”

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