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Best Buy is cashing in as Americans grow older

10/08/2018

Summary

Americans are getting older and Best Buy used it as an opportunity by buying GreatCall for $800 million. GreatCall makes cellphones with big buttons and bright screens designed specifically for senior citizens. By buying GreatCall, Best Buy has been able to expand their customer base overnight.

Key Points

  • Best Buy is increasing its chances of attracting more elderly customers by acquiring products that are designed specifically for their population
  • GreatCall says it has close to 1 million subscribers and $300 million in annual sales. The deal, expected to clear in the next few months, will be the largest in Best Buy's 52-year-history
  • Best Buy is looking for opportunities to sell services and not just products and this acquisition has allowed them to expand on their now available services

Discussion Questions

  1. How does Best Buy's new focus on attracting senior citizens allow them to expand their brand name?
  2. How does Best Buy compete with Amazon in this space?
  3. Wat benefit do companies have in acquiring other companies rather than building their own capabilities?

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