Best Buy: Customer Behavior Analytics

Accenture developed Purchase Path to help Best Buy translate customer insights into merchandising action.

According to CIO, this year's honorees "embraced IT innovation as a tool for transformation, their winning projects motivated by critical business needs and the conviction, backed by solid analysis, that technology-enabled change can create new value. The CIOs at these companies define themselves not as technology suppliers but as facilitators of corporate growth."

Best Buy understood that corporate growth had to be driven by increased customer-centricity. As Bob Willett, Best Buy's chief information officer, put it, "You don't get good sales or performance if customer satisfaction is going backward. One breeds the other." The Purchase Path project began in June 2005 as a way to increase sales, profits and customer satisfaction by tracking customer purchases across multiple transactions.

Best Buy and Accenture examined millions of sales transactions to identify meaningful relationships between product categories and different demographic groups. Launched in June 2006, the Purchase Path capability analyzes the data and aggregates the results, which Best Buy then applies to its business practices.

In particular, the solution studies what customers buy after a major product purchase so that Best Buy can improve product assortment and in-store product placement, create unique bundles and increase replenishment and in-stock levels. Ultimately, Purchase Path will enable customers to purchase everything they need at the same time or over multiple visits, with fewer hassles and return visits.

Accenture played a pivotal role in the project. "We drove the planning, requirements gathering, design, build and deployment," said Renato Scaff, the Accenture senior executive responsible for Best Buy's merchandising transformation. "With our IT outsourcing, we also run the capability now that it is live."

The overall relationship between Best Buy and Accenture has been evolving for the last 10 years. Currently, Best Buy and Accenture plan to team up for the hundreds of projects in flight at Best Buy, explained Scaff, all of which will focus on driving growth through customer-centricity and achieving cost efficiencies.

"This [CIO 100] award is great recognition for not only the Purchase Path team but for all the innovative work that we have done and continue to do at Best Buy," Scaff said. "The work is driving significant business value and positioning Best Buy to be stronger for the future."