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AP Business Case Study · Unit 4, Task 5

Best Buy: Renewing Blue in the Age of Amazon

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Unit 4 · Culminating Event — Putting Strategy into Practice

A real-company case study for Unit 4, Task 5 of AP Business with Personal Finance, written in the same format as the course's business cases. Read the case, answer each question on your own, then open the sample answers to check your thinking. Facts are current as of October 2026, and every source is listed at the bottom.

The Case

Unit & taskUnit 4, Task 5: Culminating Event — Putting Strategy into Practice
Topics4.1–4.4
Key peopleHubert Joly (President and CEO, 2012–2019; led the Renew Blue turnaround, then served as executive chairman); Corie Barry (Chief financial officer and chief strategic transformation officer under Joly; CEO since June 2019); Jason Bonfig (Longtime Best Buy executive named to become CEO on November 1, 2026)
Case years2012–2026 · Evaluation case
Key questionHow did Best Buy’s leaders combine strategic analysis, people-focused leadership, and KPIs to turn the company around, and what should its next CEO watch?
Business Canvas componentsOrganization, Market, Finance
Snapshot
  • Business: Best Buy Co., Inc., a consumer electronics retailer
  • Industry: Consumer electronics retail and tech services
  • Founded: 1966 in Minnesota; founder Richard Schulze
  • Headquarters: Richfield, Minnesota
  • Key people: Corie Barry, CEO; Jason Bonfig, CEO starting November 1, 2026; Hubert Joly, CEO 2012–2019
  • Ownership/Status: Public company (NYSE: BBY); 1,068 stores and about 82,000 employees at the end of fiscal 2026

Shoppers Who Looked but Didn’t Buy

Best Buy began in Minnesota in 1966, founded by Richard Schulze, and grew into a chain of large electronics stores where shoppers could see and try the newest TVs, computers, and phones in person. By 2012, that experience had become a problem. Many shoppers were “showrooming”: they tested a product at Best Buy, then bought it online for less. Amazon was taking market share, and Best Buy’s annual report pointed out that online-only sellers did not have to collect sales tax in certain states. Best Buy’s same-store sales had fallen in seven of the previous eight quarters, its quarterly profit plunged 91%, and its stock sank to a nine-year low. The company was even in a takeover battle with its own founder. Fortune later wrote that Best Buy could have met the same fate as Circuit City, a rival electronics chain that went bankrupt. Best Buy lost $1.2 billion in the fiscal year that ended in March 2012 and another $441 million in the 11 months that followed.

An Outsider Takes Charge

In September 2012, Best Buy named Hubert Joly president and CEO. Joly came from Carlson, a global hospitality and travel company, and investors were worried: Best Buy’s shares tumbled 10% when he was named, and one Wall Street analyst said on television that Joly wasn’t qualified. Joly began by spending time in stores to meet customers. Then he launched a turnaround plan called Renew Blue. Its priorities included selling more online, getting more out of the space inside stores, and giving shoppers a better experience.

Renew Blue in Action

The first target was price. In 2012, Best Buy began matching Amazon’s prices. After testing a broader price-match program over the holiday season, it rolled out an enhanced price-matching policy across the United States in March 2013. Shoppers who came in to see a product no longer had a price reason to leave and buy it somewhere else.

Next, Best Buy found new ways to use its stores. It teamed up with major brands, including Samsung, Sony, Apple, and Amazon, to create brand shops inside its stores. It began shipping online orders directly from stores, which sped up delivery. It also added more tech support, including advisors who visited customers’ homes to help with tricky installations.

Joly also focused on people. According to Harvard Business School’s account, his first moves were not the usual turnaround steps of mass layoffs and closing money-losing stores. Best Buy invested in training its blue-shirted sales associates, and the training moved away from slide shows and videos toward open conversations in which executives and front-line workers talked about their own purpose in life. Forbes credited Joly with lifting associate morale. Best Buy still cut costs: about 400 jobs were eliminated at corporate headquarters, and Joly later said the company had been breaking about $200 million worth of TVs every year until better packaging cut that by half.

Keeping Score

Investors and managers tracked the turnaround with a handful of numbers. Best Buy’s stock, which had dropped to about $11 in late 2012, tripled in 2013. In May 2017, Best Buy reported that comparable sales had risen 1.6% and online sales 22% in its latest quarter, and its shares closed at an all-time high of $61.25. The analyst who had doubted Joly admitted that he had underestimated him. By February 2019, Best Buy had reported eight straight quarters of comparable sales growth, and its shares had more than quadrupled during Joly’s time as CEO. In June 2019, Joly handed the CEO job to Corie Barry, his chief financial officer and chief strategic transformation officer, whom Fortune called a key architect of his strategy. Joly stayed on as executive chairman.

Where Things Stand

Barry steered Best Buy through a pandemic sales boom, which pushed yearly revenue past $50 billion for a time, and the industrywide slump in electronics sales that followed. In fiscal 2026, which ended in January 2026, revenue was $41.7 billion—well below the $50 billion goal for 2025 that Best Buy had set in 2019. By April 2026, Fortune calculated, Best Buy’s shares had gained 6% since Barry became CEO, compared with 157% for the S&P 500. Tariffs added pressure because almost none of the products Best Buy sells are made in the United States; in October 2025, Barry said the share of Best Buy’s goods coming from China had fallen from about 55% at the start of that year to about 35%. Just five suppliers—Apple, Samsung, HP, LG, and Sony—account for about 55% of the merchandise Best Buy buys. The company has added new businesses too, including a U.S. online marketplace where outside sellers can list products and Best Buy Ads, which sells advertising to brands.

In April 2026, Best Buy announced that Barry would step down and that Jason Bonfig, who joined the company in 1999 as an inventory analyst, would become CEO on November 1, 2026. Second-quarter results released in August 2026 showed sales growth picking up (Exhibit 1), and Best Buy raised its revenue forecast for the year. At the end of fiscal 2026, Best Buy had 1,068 stores in the United States and Canada and about 82,000 employees. As of October 2026, its next leader inherits the question Joly faced in 2012: why should shoppers buy from Best Buy?

Exhibit 1: Best Buy’s second-quarter KPIs, one year apart
KPIQ2 fiscal 2026 (ended Aug. 2, 2025)Q2 fiscal 2027 (ended Aug. 1, 2026)
Enterprise revenue$9,438 million$9,779 million
Comparable sales change (enterprise)+1.6%+4.1%
Online revenue as a share of Domestic revenue32.8%33.1%
Operating income as a share of revenue2.7%4.3%
Diluted earnings per share$0.87$1.48

Source: Best Buy, “Best Buy Reports Q2 FY27 Results,” August 27, 2026. Best Buy’s fiscal year ends in late January or early February, so fiscal 2027 began in February 2026.

Reading Questions

These are the same for every case. They check that you caught the basics before you analyze.

1. Which business does this case feature, and what product or service does it provide?
The case features Best Buy, a consumer electronics retailer based in Richfield, Minnesota. It sells products such as TVs, computers, phones, and appliances through 1,068 stores in the United States and Canada (at the end of fiscal 2026) and online, and it provides services such as Geek Squad technical support and in-home advisors. More recently it has added a U.S. online marketplace for outside sellers and Best Buy Ads, which sells advertising to brands.
2. Who are the key people named in the case, and what roles do they play? Which other stakeholders — individuals or groups — have an interest in the business?
Hubert Joly became president and CEO in September 2012 and led the Renew Blue turnaround before becoming executive chairman in 2019. Corie Barry was Joly’s chief financial officer and chief strategic transformation officer and became CEO in June 2019; she is stepping down in 2026. Jason Bonfig, who joined Best Buy in 1999 as an inventory analyst, will become CEO on November 1, 2026. Richard Schulze is the founder, who was in a takeover battle with the company in 2012. Other stakeholders include customers (including shoppers who showroomed), blue-shirted sales associates and other employees, shareholders and Wall Street analysts, suppliers and brand partners such as Apple, Samsung, Sony, HP, LG, and Amazon, competitors such as Amazon, sellers on Best Buy’s marketplace, and governments whose tariff policies affect Best Buy’s costs.
3. Identify an opportunity and/or a challenge the business faces in this case.
In 2012, the main challenge was showrooming and lower online prices from rivals such as Amazon, which helped push same-store sales down in seven of eight quarters. An opportunity was using Best Buy’s physical stores in new ways—hosting brand shops for companies such as Samsung and Apple and shipping online orders from stores to deliver faster. More recently, a challenge is tariffs and slower growth (after topping $50 billion during the pandemic, revenue fell to $41.7 billion in fiscal 2026, below its $50 billion goal), while an opportunity is new businesses such as its online marketplace and Best Buy Ads.

Practice Questions

These apply the Unit 4 concepts from Task 5 to the case, in the style of AP free-response prompts.

1. Identify one external threat and one internal strength Best Buy had in 2012. Then explain how one Renew Blue strategy used that strength to respond to the threat.Topic 4.4 · LO 4.4.C, LO 4.4.D
One external threat was showrooming combined with lower prices from online competitors such as Amazon—a market factor Best Buy could not control. One internal strength was its large network of physical stores, where customers could see and try products in person. Renew Blue’s price-matching policy used that strength to respond to the threat: once Best Buy matched Amazon’s prices, a shopper who came into a store to test a TV no longer had a price reason to leave and buy online. As a result, more store visits turned into Best Buy sales instead of sales for rivals. Best Buy also used its stores to ship online orders faster and to host brand shops for companies such as Samsung, Sony, and Apple, turning its floor space into something online-only rivals could not easily copy.
2. Explain how Hubert Joly’s leadership approach toward front-line employees could improve employee motivation and retention and, in turn, Best Buy’s performance. Use evidence from the case.Topic 4.1 · LO 4.1.B, LO 4.1.D
Leadership is influencing and guiding people toward a goal. Joly began by spending time in stores, and instead of beginning with mass layoffs and store closings, Best Buy invested in training its sales associates and turned that training into conversations in which executives and front-line workers discussed their own sense of purpose. Forbes credited Joly with lifting associate morale. Employees who feel valued and understand why their work matters are more motivated and more likely to stay, so experienced associates who know the products remain on the sales floor. Because Best Buy had already matched online prices, knowledgeable and helpful associates became a key reason for customers to buy in the store, so better motivation led to better service and more sales. The results are consistent with this: by February 2019, Best Buy had reported eight straight quarters of comparable sales growth.
3. Using Exhibit 1, calculate the percent change in Best Buy’s enterprise revenue from the second quarter of fiscal 2026 to the second quarter of fiscal 2027. Then explain why Best Buy uses the same quarter of the previous year as a benchmark, and describe what the comparable sales KPI shows that total revenue alone does not.Topic 4.2 · LO 4.2.B, LO 4.2.C
Percent change = (new − old) ÷ old = ($9,779 million − $9,438 million) ÷ $9,438 million = $341 million ÷ $9,438 million ≈ 0.036, an increase of about 3.6%. Best Buy compares each quarter with the same quarter a year earlier because its sales are seasonal—its 2013 annual report said the holiday quarter had historically produced about one-third of its yearly revenue—so the same quarter last year is a fair benchmark, while comparing the second quarter with the fourth would be misleading. Comparable sales measure activity at stores that have been open a year or more, so this KPI shows whether the existing business is growing rather than whether growth came from opening new stores. Comparable sales rose 4.1%, compared with 1.6% a year earlier, and operating income rose from 2.7% to 4.3% of revenue, which shows that Best Buy’s sales growth was speeding up and becoming more profitable.

Discussion Questions

Talk these through with a partner or your class. There's more than one good answer, so back yours up with evidence from the case.

  1. Use PACED to evaluate the decision Best Buy faced in 2012. What was the problem? What alternatives could it have chosen—for example, closing many stores and selling mostly online, competing only on service, or matching online prices? Which criteria matter most, and what would you have decided?
  2. Matching Amazon’s prices meant earning less on some sales. Why might a leader accept that trade-off, and which KPIs would show whether it was working?
  3. Five suppliers provide about 55% of the merchandise Best Buy buys. How strong is the bargaining power of suppliers in this market, and how might brand shops inside Best Buy stores change the relationship between Best Buy and brands such as Samsung and Apple?
  4. Corie Barry led Best Buy through a pandemic boom, an electronics slump, and new tariffs, and revenue fell short of the 2019 goal. How much of a CEO’s results come from leadership decisions, and how much from external factors? Use SWOT language to support your answer.
  5. Which factor do you think was most important to Best Buy’s turnaround? Support your choice with evidence from the case. a. Price matching b. Brand shops inside stores c. Shipping online orders from stores d. Investing in front-line employees

Application Activity

It is November 2026, and Jason Bonfig has just become Best Buy’s CEO. Choose one challenge from the case (tariffs, slower growth, or competition from online sellers). Using PACED, list two alternatives and three decision criteria (at least one should be a KPI from Exhibit 1), evaluate each alternative, and write a one-paragraph recommendation that names the benchmark Bonfig should use to measure success.

Key Takeaways

  • Strategy starts with an honest look at internal and external factors. Best Buy could not stop showrooming or Amazon’s low prices (external threats), but it could change its own prices and use internal strengths—its stores, its employees, and its relationships with brands—to carry out a clear plan, Renew Blue.
  • KPIs and benchmarks tell leaders whether a strategy is working. Best Buy tracked comparable sales, online sales growth, operating income as a share of revenue, and its stock price, and it compares each quarter with the same quarter a year earlier.
  • Leadership and people matter as much as tactics. Joly invested in training and purpose for front-line workers, and Best Buy has developed its CEOs from within—Barry and Bonfig both rose through the company—showing why businesses hire and develop employees with a variety of core competencies.

Use it in your Business Canvas Project

Treat your final Canvas like Renew Blue: connect one SWOT threat to the strength you will use to respond, name the KPI and benchmark that will show whether your strategy is working, and explain how your team’s roles and motivation plan support that strategy.

For Teachers

Opening activity: Ask students whether they have ever looked at a product in a store and then bought it online instead, and record their reasons on the board. Explain that in 2012 this habit, called showrooming, threatened Best Buy’s survival. As they read, have students track three things: the leaders’ choices, the KPIs used to judge results, and the internal and external factors the company faced.

Tip: “Print case” prints the case and all questions with the sample answers hidden, so it works as a student handout.

Sources

  1. Best Buy Co., Inc. Form 10-K for the 11-month transition period ended February 2, 2013, Best Buy Co., Inc. / U.S. Securities and Exchange Commission, 2013-03
  2. Best Buy Co., Inc. Form 10-K for the fiscal year ended January 31, 2026, Best Buy Co., Inc. / U.S. Securities and Exchange Commission, 2026-03
  3. Best Buy Reports Q2 FY27 Results, Best Buy Co., Inc., 2026-08-27
  4. Best Buy: How Human Connection Saved a Failing Retailer, Harvard Business School Working Knowledge, 2021-05-04
  5. Best Buy Names Finance Chief Corie Barry to Replace Hubert Joly as CEO, Fortune, 2019-04-15
  6. Best Buy CEO Hubert Joly confounds the naysayers, CBS News (MoneyWatch), 2017-05-25
  7. My Retailer Of The Year: CEO Hubert Joly Puts The Best In Best Buy, Forbes, 2016-12-26
  8. CEO Hubert Joly’s Best Buy has just begun to fight, Star Tribune, 2013
  9. Best Buy CEO Corie Barry is stepping down: Why the comeback she executed fizzled out, Fortune, 2026-04-22
  10. Best Buy’s CEO says growing spending power gap between affluent and poor ‘keeps me up at night’, Fortune, 2025-10-14
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