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Best Buy CEO Corie Barry speaks on adapting to a COVID-19 affected economy

Best Buy CEO Corie Barry sat down with Yahoo Finance Editor-at-Large Brian Sozzi to discuss how the COVID-19 pandemic has changed the company's business, and how they are now adapting to a new emerging economy and new customer trends.

Video Transcript

BRIAN SOZZI: Corie Barry has been the CEO of Best Buy since 2019. The COVID-19 pandemic destroyed brick and mortar retailers. But under Barry's leadership, Best Buy hasn't just survived; it has thrived. Its online sales tripled over the summer as customers hunkered down from COVID and bought everything from chest freezers to home theaters. But arguably, Corie Barry's biggest victory yet is beating back the threat from Amazon.

Let's welcome in Best Buy CEO, Corie Barry. Corie, good to see you.

CORIE BARRY: It's great to see you, too, Brian. Thanks for having me.

BRIAN SOZZI: Well, I'm one of those guys. I've been doing a lot of shopping at your stores pretty much every week. And don't pull up cameras because it's kind of creepy. I'm constantly going there. But really, you know, now that we had some time to reflect back a bit on the pandemic and the year, what was that first moment that you realized, you know what, this is going to be a strange year and not like anything I've ever managed through before?

CORIE BARRY: You know, I think we all hit it around the same time. There was that moment, as we headed into March, where you started to see the proliferation of the virus, and you started to feel the concern. And certainly, we felt the concern both from our customers and our employees.

And it was about the third week in March when we said, we really need to think about how we're going to manage this company without a playbook, without, you know, any direction that's ever been set before. And we started to think about, what do we need to prioritize in order to lead through this really differently?

BRIAN SOZZI: In some respects, though, you do have a little bit of a-- a little bit of a playbook. You've been at the company for 20 years. You've worked 15 positions at the company. You know the stores really very, very, very well. How has that experience helped?

CORIE BARRY: Well, the good news is it's not just about my experience. It's about this experience of our team. And we have a really deep bench of experience on our team, as well as augmented with some fresh outside perspectives. And I think that combination, people who really understand operationally deeply how this company runs, augmented with bringing in some experts around technology, some experts around data and analytics who could help drive the change quickly, was an incredibly powerful tool because as long as you could set the parameters, then you could trust exceptional leaders across the organization to make fast decisions and then change on a dime. And I think that's really where the magic comes from.

BRIAN SOZZI: How did you develop that playbook?

CORIE BARRY: Yeah. Every day on the fly. It actually started with-- we set three guiding principles. And this isn't a change of strategy. It's just what are the guiding principles for our needs to make every decision?

The first was, keep our customers and our employees safe. Prioritize safety. The second was to protect the employee experience as much as we could for as long as possible. And the third was to come out of this not just a vital company, but a vibrant one.

And setting those three principles was really important on the front side because every decision we made starting there was tacked back. And so when we chose in the third week in March to close down all of our stores and move to curbside, that wasn't because it was mandated. That's because given how little we knew at that point about the spread of the virus, given how little we knew about how to keep people safe, it seemed like the very best possible outcome from a safety of customers' and employees' perspective. And we felt pretty strongly we could continue to run the business in an effective manner that way.

BRIAN SOZZI: How has the pandemic change Best Buy? And there's-- as I see it from two sides. As a customer, I go in the store-- it's a different experience. But I also imagine-- we think corporate and thinking. I've covered retail for a long time. And retailers always want to get everything perfect, but this is not a perfect environment.

CORIE BARRY: I mean, this is the definition of agility. We talk a lot about agility when we're talking about software or when we're talking about development of technology. Agility is not as often practiced as a retailer, because, to your point, when you're pushing out a standard operating procedure to 1,000 stores, you want that to be perfect.

And instead, what the company has learned is give as much direction as possible the parameters and then allow the stores to iterate on those parameters. And so what are the most effective things that we had was a constant feedback loop. We would create the best possible playbook we could quickly. And we'd get a lot of feedback, and we would iterate and move on to the next stage in the playbook.

BRIAN SOZZI: What about the store experience? How has that changed?

CORIE BARRY: I think there are two big changes to this store experience. The first is empirically, how do I make things as safe as possible, meaning what steps do I need to take around cleaning or capacity or social distancing or masks, like, empirically how do I create the safest experience? And then the second point around safety is, how much value is there in the experience? If I'm offering something that's incredibly valuable to people because of the way they're living-- to your point, someone needs their fridge repaired-- there is a high level of value.

We also have learned to use our workforce much more flexibly. And this is where I give our teams a ton of credit. They're able to move much more rapidly between departments in the store or to help someone with their curbside pickup or to help someone who needs a return or need something repaired.

BRIAN SOZZI: How have you been able to get employees to buy in? I remember going to Best Buy at the height of the pandemic. I needed a whole bunch of office-- work from-- work from home equipment. And Best Buy employees, they were there. They were some of the first people I came in interaction with. How do you-- how have you made them feel safe?

CORIE BARRY: I'm going to start with our purpose. And I think it's really important. Our purpose is to enrich lives through technology. And I believe fundamentally this is more than a tagline. And I believe our employees believe that, too.

And all the sudden with the pandemic, it became true in spades overnight. The only way we can connect with loved ones is using technology. The only way we can work, we can learn, we can entertain, cook, all of those things are being done on the back of technology. And our employees believe in our purpose.

The thing that-- someone asked me, what has made me most proud throughout this time period? And the truth is that our employees are proud. Every general manager that I talk to-- I get the chance to FaceTime with them, and they walked me through their stores. And every general manager I talk to will talk about how proud they are of both how their employees have showed up, and what we have done to help customers solve real needs. And I think it's that combination of our purpose with their personal purpose around helping customers. It's just inspirational.

BRIAN SOZZI: You did have to make a tough call, I imagine for you as someone who came up through the stores in many respects to furlough 51,000 workers. Are they back now? What percentage have come back to work?

CORIE BARRY: Yeah. So as of our Q2 announcement, which was midway through August, we had brought 2/3 of our employees back. And then we announced as we've been doing our holiday hiring-- every year, you hire up for holiday, and we are definitely hiring up for holiday-- we were able to offer every single additional furloughed employee at least seasonal hours and seasonal work, should they want that. So at this point, nicely, we've at least been able to offer everyone, at least through holiday, some level of hours and work.

BRIAN SOZZI: Talk to us about the holiday season. It's shaping up to be a bizarre holiday season, to say the very least. What efforts are you putting into to keep people safe, but also to encourage shopping? I mean, the country's in rough shape.

CORIE BARRY: Yeah. So I'm going to start with, where you landed, which is encouraging shopping. And I think that's less about, does it have to be in the store? And that's much more about we want to be there for the customers. In whatever channel, form, style, we want to be there for them.

And so everything that we're doing, we are leading with the customer experience and putting the customer in charge. They define safety for themselves, which means they get to be in charge of how they want to shop. So in order serve that customer need, there are kind of three big focus areas.

The first-- and you've already seen, and you've covered it ad nauseam-- is the idea of the holiday starting sooner, lasting longer, seeing more promotional cadence throughout a longer period of time. Now, part of that is so that you can actually spread out those peaks and provide a safer experience over time. So many of the Black Friday deals-- you saw some of them already without last week. You're going to see the ads come out toward the end of the month. So everyone has full visibility to what's in there.

And I think what we're trying to avoid is the kind of natural response of lines at stores on Black Friday. That just can't happen. And so instead, we're definitely using all the channels and all the tools to help get people what they need, but do it in a little bit more protracted way, which then the second major implication is around fulfillment.

People want to get the stuff in whatever way they want. 40% of what we sold online in Q2 was picked up in-store. And so offering this combination of whether you want it on your couch, whether you want it curbside, or whether you want it at the counter of the store, we can do all those things for you. And you're the one who gets to define.

And then finally-- you started with it-- is the idea of creating a safe shopping experience. And that's been a priority from day one. And we will continue to make it a priority that we have maximum capacities for our stores.

We have cleaning protocols. Masks are required. Social distancing is still very possible, given the size of our stores. And so where we're trying to make sure the customer feels like they're in control. And then making sure whatever they choose, we deliver it as safely as possible.

BRIAN SOZZI: I did want to go quickly a little bit around the horn with you. It's not often you do-- I know you don't do a lot of these. So I'm glad you have done it.

5G-- you know, our parent company Verizon is taking a leadership position in 5G nationwide rollout. How will 5G Apple iPhones change Best Buy next year?

CORIE BARRY: I think it's less about one particular piece of technology in 5G. And I think it's more about what 5G will open up across different types of technology over time. Phones are definitely interesting because your latency is so short if you have 5G capability. But ultimately it's going to be about computing on the go and gaming on the go and the ability to just do more because you have that massive amount of bandwidth. And so I think this bodes well over time that there will be more and more devices that will leverage 5G capabilities, whether it's in your home but frankly, also on the go.

BRIAN SOZZI: How has the pandemic changed you as a leader?

CORIE BARRY: I think for me it has underscored a couple of things. The first is my own philosophy about the role of a CEO is to create the conditions for other amazing leaders to be successful, and to move as quickly as we'd move to make the decisions. It's not just about me sitting alone in my office, you know, checking out decisions. It's about using and leveraging and unleashing the leaders around me. And that philosophy has actually only held more true during the time of the pandemic.

I think that the second big piece here for me is that it's a very personal time for people. This isn't just about go do your work, and it's separate from your personal life. I think everyone's work and personal lives are very combined.

And so I think making sure that I exhibit-- we have what we call inclusive leadership behaviors at Best Buy. And they are empathy, courage, vulnerability, and grace. And those leadership behaviors-- not something you always hear a corporation talk about, but I think in a time where our personal lives and professional lives are so intertwined, not being afraid to exhibit those behaviors is crucial for our teams right now.

BRIAN SOZZI: 50% of your board is female. I don't pretty much see that anywhere else out there in corporate America. How did you make that happen? And are you looking to even increase that percentage moving forward?

CORIE BARRY: Yeah. I am fortunate to have followed our prior CEO Hubert Joly, who had a very strong point of view about board diversity. And when you ask, how did you make it happen, we decided we wanted to make it happen. And there are plenty of qualified candidates out there.

And you know, when you prioritize here's the qualities we need-- and we would like to increase the diversity of the board-- that's a very powerful combination. And so you're absolutely right-- right now actually, just a little bit over 50% of our board is female. And just over a quarter are people of color.

And I think that makes the conversations that many of us have been having around issues of inclusion and diversity, issues of social justice. It creates an amazing platform to have those conversations not just as a leadership team, but actually with your board.

BRIAN SOZZI: What does it mean for Best Buy's future that, in many respects, you all are the last man standing in the electronic space? Yeah, we have the discounters. We have a target. We have a Walmart. We have a Costco. We have a BJ's.

But there are no other retailers of your size out there doing what you're doing. What does that mean, to your future?

CORIE BARRY: Yeah. So let me say first out loud, we do get the luxury of competing against the world's foremost retailers. And there are definitely many who carry consumer electronics products. But I do think our differentiation is our ability to show you everything that might be possible.

So I'll take computing as a category-- everything from the opening price point laptops to the $1,500 perfectly spect gaming computer and everything in between with a knowledgeable associate who can help you put a full solution for your life together. And I think the way that all of us are living right now, all the sudden you really start to see this idea that our lives truly can be, and actually have to be right now, enriched by technology.

It's a very unique end-to-end position where we're able to help you. Whether it's just that point solution you want to buy online, or you do want to come in and put together that home office, we can help you across that spectrum. And I think that is our uniqueness as we go forward.

BRIAN SOZZI: Before I let you go your biggest goal for 2021? The reality is COVID-19 is unlikely to go anywhere anytime soon.

CORIE BARRY: The customer is in control, and the customer's going to remain in control for the foreseeable future. To your point, likely, COVID's not going away anytime soon. And so my biggest goal for the future is to continue to push the envelope in how we meet the needs of the customers. And we do that in a way that's safe for our employees and safe for our customers, but gets them the gear they need in order to find maybe that moment of joy in their life.

BRIAN SOZZI: Well, I will thank you because I've spent a ton of money in your stores outfitting my work from home life. So thank you. Please keep all that stock moving forward. I suspect I will be needing a next level of stuff moving forward. Corie Barry, Best Buy CEO, good to see you.

CORIE BARRY: Good to see you as well. Thank you.