NEW YORK -- Shares of Best Buy jumped on Thursday after it announced plans to create store-within-store kiosks for Samsung products - a vote of confidence from a major consumer electronics retailer that the brick-and-mortar format is still an important way to sell products.
Best Buy shares rose more than 16 percent Thurday.
The Minneapolis-based company has battled the "showrooming" effect as more and more people browse in stores and then buy items cheaper online. This has led to fears that the big-box store format is growing obsolete.
But Best Buy has aggressively fought back under new CEO turnaround expert Hubert Joly - introducing an online price matching policy, giving employees extra training and cutting costs and revamping stores.
The latest deal is a sign that consumer electronics retailers are sticking with the chain. The company will offer Samsung dedicated kiosks at 1,400 Best Buy and Best Buy Mobile stores. Shops will offer the full range of Samsung's mobile products, including smartphones, tablets, laptops, cameras and accessories.
The move shows "a very high-profile consumer electronics vendor still finds Best Buy a relevant distribution outlet," said Morningstar analyst R.J. Hottovy.
It's also a way for Samsung to carve out dedicated retail space without investing in overhead necessary to open its own stores, like its chief rival, Apple Inc., has done.
About 900 Best Buy and Best Buy Mobile stores will be open by early May, with the rest open by early summer.
Janney Capital Markets analyst David Strasser said the deal is an example of Best Buy making merchandising progress. He said it may be a wake-up call that will convince other vendors, like Google, Microsoft and Sony, to invest more with Best Buy.
Best Buy shares rose $3.48 or 16.1 percent, to close at $25.13 Thursday, after briefly reaching a 52-week high of $25.30. The stock has more than doubled since the start of the year.
-----
Online:
http://www.bestbuy.com/samsungexperienceshop.
.
What You Should Know About Comments on Sacbee.com
Sacbee.com is happy to provide a forum for reader interaction, discussion, feedback and reaction to our stories. However, we reserve the right to delete inappropriate comments or ban users who can't play nice. (See our full terms of service here.)
Here are some rules of the road:
• Keep your comments civil. Don't insult one another or the subjects of our articles. If you think a comment violates our guidelines click the "Report Abuse" link to notify the moderators. Responding to the comment will only encourage bad behavior.
• Don't use profanities, vulgarities or hate speech. This is a general interest news site. Sometimes, there are children present. Don't say anything in a way you wouldn't want your own child to hear.
• Do not attack other users; focus your comments on issues, not individuals.
• Stay on topic. Only post comments relevant to the article at hand.
• Do not copy and paste outside material into the comment box.
• Don't repeat the same comment over and over. We heard you the first time.
• Do not use the commenting system for advertising. That's spam and it isn't allowed.
• Don't use all capital letters. That's akin to yelling and not appreciated by the audience.
• Don't flag other users' comments just because you don't agree with their point of view. Please only flag comments that violate these guidelines.
You should also know that The Sacramento Bee does not screen comments before they are posted. You are more likely to see inappropriate comments before our staff does, so we ask that you click the "Report Abuse" link to submit those comments for moderator review. You also may notify us via email at feedback@sacbee.com. Note the headline on which the comment is made and tell us the profile name of the user who made the comment. Remember, comment moderation is subjective. You may find some material objectionable that we won't and vice versa.
If you submit a comment, the user name of your account will appear along with it. Users cannot remove their own comments once they have submitted them.
Order Reprint
About Comments
Reader comments on Sacbee.com are the opinions of the writer, not The Sacramento Bee. If you see an objectionable comment, click the "Report Abuse" link below it. We will delete comments containing inappropriate links, obscenities, hate speech, and personal attacks. Flagrant or repeat violators will be banned. See more about comments here.