Best Buy steps it up in New York

NEW YORK – In one of the world's most competitive marketplaces, Best Buy wants to make sure it is putting its best foot forward.

For starters, it doesn't want to make New Yorkers, who are often in a hurry, work harder than necessary to find what they want, especially in a city where Amazon is quite popular with the locals.

So Best Buy has been doing things like moving its Apple mini-shops, and expanding them, to prime real estate near the entrances of its Manhattan stores. It separated its in-store pickup areas from the rest of its customer service counter and boosted its staffing in that area to reduce wait times when customers come in to fetch online orders. And it added concierges who walk around with tablets in hand to help customers navigate its multilevel stores.

The Richfield-based electronics retailer in the last year has poured $5 million to $10 million into upgrades in the New York region, which is one of its largest markets with about 45 stores.

Best Buy, whose growth has slowed amid competition from online retailers, hasn't opened new stores in recent years. Instead, it has been focusing on spiffing up the stores it does have with an emphasis on some of its larger markets.

In 2014, it refreshed its stores in the Chicago and Dallas-Fort Worth markets. That was followed last year by renovations at its Atlanta, San Francisco and New York area stores.

"It's not just new paint and new floors," said Carly Charlson, a Best Buy spokeswoman.

In many cases, it has meant adding some of the retailer's newer innovations such as its higher-end Pacific Kitchen & Home appliance mini-shops as well as its Magnolia Design Centers, which offer pricey solutions to turn a simple TV room into a state-of-the-art facility. In New York, it has also included stepped-up training and pay for workers to help with recruitment and retention in the fiercely competitive market.

"Best Buy is doing what it has to do to survive against Amazon — and what all retailers have to do — with a new generation of millennials coming up who are quite happy to shop online," said Robin Lewis, a retail strategist and co-author of "The New Rules of Retail — Competing in the World's Toughest Marketplace." "The only reason for any consumer to go to a physical store is for there to be incredible service and entertainment of some sort."

Best Buy opened its first Manhattan store in 2002 in the Chelsea neighborhood. It now has six stores in that borough, including one in Union Square that is the only store in the chain to stay open 24 hours a day.

The New York City stores have other features you don't find in your typical Best Buy store. Instead of being spread out across one floor, most of them span two or three floors in a city where space is at a premium. Since they are often embedded in other buildings, the exterior and store signage is also more subtle compared to the hulking blue and yellow boxes often found in the suburbs.

"The traffic patterns are inherently different, too," Adam Soto, market senior director of Best Buy's New York stores, said during a tour of the Chelsea store during a weekday. "In your typical suburban Best Buy, you're going to be looking to capitalize on traffic primarily on Friday, Saturday and Sunday. We get busy on the weekends, but as you see, we have a large amount of foot traffic during the week as well. And it's not even lunchtime yet."

And then there's Chloe, Best Buy's experimental robot that was installed in the Chelsea store last fall. The souped-up vending machine can be accessed from several kiosks, some inside the store and a couple in a vestibule at the front entrance, which is open all night even when the store is closed. Customers can use the machine to buy DVDs and CDs as well as other small items such as cellphone chargers and cables that people might need in the middle of the night. It's also become a popular option for customers to immediately get their hands on midnight releases of video games.

In addition to Amazon and a host of mom-and-pop shops, one of Best Buy's biggest competitors in New York is one of its major vendors — Apple, which also has six stores in Manhattan. Since Apple is so popular in New York, many Best Buy stores last year expanded their Apple in-store shops with fancier displays and moved them to prominent places near the front. The stores also added more Apple support staff.

Headphones are also popular in a city where people get around on foot or on the train. Best Buy has given products such as Beats headphones bigger billing on the ground floors with splashier displays.

At its bustling Midtown store frequented by many international tourists, selfie sticks have been a big seller and are prominently placed near the entrance.

"They are tweaking a lot of things in the box," said Charlie O'Shea, an analyst with Moody's. "Best Buy, like a lot of retailers, is getting pretty granular in how they run individual stores."

One of the major thrusts of the refresh of the New York stores was also helping customers more quickly and easily pick up online orders. Before, it wasn't immediately clear where customers should go to pick up those orders. "The experience was a little bit muddled," Soto said.

So in the Chelsea store, for example, Best Buy moved the customer service counter, where customers previously picked up online orders, to the lower level and dedicated the area on the ground floor just for in-store pickup. Big signs near the entrance show customers the way to it. And the store designated a person to be in charge of pulling those items from the shelves to speed up the process. As a result of these changes, Soto said there's been less confusion and waiting times have dropped.

On a recent day, Gina Malfa swung by the Midtown store to pick up a modem and router she had ordered online. She was in and out in a couple of minutes. She could have waited for it to be delivered to her apartment, but she preferred to pick it up on her way home from work.

"It's just so convenient," she said. "I'm impatient most of the time."

Kavita Kumar • 612-673-4113