Best Buy is a well-known electronics store in the United States. In 2003, the company tried to expand into China and things looked good at first. But despite its massive success at home, the company struggled to connect with Chinese consumers and closed all its branded stores in 2011. What went wrong? And what can other brands learn from this?
That blog post will look at how a better media campaign could have helped. I will also explain what a CEO should know before speaking to the media in a new country. Lastly, I will discuss the challenges of doing research in a foreign market.
Media strategy that fits China
When entering a new country, it is important to understand local habits. Best Buy used the same strategy in China as it did in the U.S. That did not work. As the case study says, “Best Buy’s entrance into the Chinese market presented numerous unforeseen hurdles that have led to the company’s inability to gain a market share in China” (p.3).
Chinese consumers prefer to bargain and shop in small local stores. The case explains that “the level of traffic in China’s metropolitan cities contributes to the popularity of these smaller, local stores” (p.3). In contrast, Best Buy opened large stores that were far from many neighborhoods.
The company also missed the chance to connect with Chinese values. In China, people trust word-of-mouth. They often ask family or friends before buying. The case study says, “Chinese consumers regard the interests of their families more than their Western counterparts and use word of mouth to research products” (p.3).
A better campaign would have focused on value and trust. It should have shown that Best Buy understands local needs. Instead of just offering customer service, the message should have explained why shopping at Best Buy a smart and safe choice for families is.
Preparing the CEO for media interviews in China
If I were training the CEO for interviews in China, I would start by reminding them of the company’s past mistakes. The case explains that Best Buy “failed to recognize the unique composition of China’s retail landscape” (p. 3). The CEO should not assume that the U.S. model works everywhere.
In China, business is based on relationships, or guanxi. One quote says that Best Buy’s approach “created both guanxi and face problems” (p. 4). This happened because the company did not involve suppliers in the same way other Chinese stores do.
The CEO should talk about how the company is learning from these issues. It would be good to mention the partnership with Five Star. That shows Best Buy is now working with people who know the Chinese market well.
Challenges in doing research in China
Before planning a media campaign, research is needed. But doing research in China brings challenges. One issue is understanding behavior. The case says, “In China, when consumers make a purchase, they value a fair price over the fixed costs associated with products at Best Buy” (p. 4). This makes it hard to ask the right questions. People may not respond in ways that researchers expect.
Another problem is language and culture. The name “Best Buy” was translated to “Baisimai,” which means “to buy after thinking 100 times” (p. 4). The case says this name may have made people distrust the brand. That shows how even small details can affect results.
It is also hard to build trust when doing surveys or interviews. People may not speak openly. They might feel unsure about foreign companies collecting data.
Conclusion
Best Buy’s story in China shows that a strong brand is not enough. Companies need to learn about local culture, values and habits. A media campaign must fit the country. CEOs must speak with care. Research must be done with respect and understanding. Only then can a business truly succeed in a new market.
Sources:
Sharma, R. (2023, December 28). Why Best Buy failed in China. Investopedia. https://www.investopedia.com/articles/personal-finance/072315/why-best-buy-failed-china.asp
Case 4 – Best Buy Is China Ready for the Big Box?




