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Best buy looks for leading edge private label

November 9, 2005

Best Buy is looking for every conceivable way to differentiate itself from Wal-Mart, who recently made it clear it’s trying to move upscale. Best Buy’s latest move is to try and uncover new ideas and companies in the consumer electronics space. It’s working with VC companies to identify potential partners. Best Buy’s goal is to develop a line of innovative private label electronics products.

Most private label electronics have been low cost or at the value-end of the spectrum; products that offered very little in the way of innovation and just gave consumers an entry-level item. This latest move suggests Best Buy could be teaming up with companies that look more like Tivo, the creator of an innovative technology that did not come from one of the labs of a giant Japanese or Korean company.

This strategy obviously has considerable appeal to Best Buy and to new-start-ups looking for funding and that all-important marketing and retail distribution. The only worry for Best Buy lies in annoying one of its major electronics partners, by beating them to an innovation. However, that’s a risk Best Buy seems happy to take.

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