Name: MPW Summit 2023: Capturing The Consumer
Uploaded: 2023-10-12
Duration: 16 min 44 s
Description: Corie Barry, Chief Executive Officer, Best Buy Interviewer: Emma Hinchliffe, FORTUNE

Corie Barry, Chief Executive Officer, Best Buy Interviewer: Emma Hinchliffe, FORTUNE

MPW Summit 2023: Capturing The Consumer

Conferences

Good morning. Hello, good morning, everybody. Welcome. Thank you for being with us for our final day of the NPW summit. Um As we start today's program, I wanna mention that today is the annual International Day of The Girl. We celebrate girls around the world today and we look forward to them becoming the change makers and the most powerful women of tomorrow. Um I have to say just being here with all of you um the power, the intellect that we've gathered and all of the information sharing has just been fantastic. Um And, and incredibly inspiring these last few days. Um The whole NPW team has enjoyed talking with you and learning from you and I really, really appreciate all of your questions and comments throughout. Um Before we get started, I'm sure many of you saw the heartwarming photo board on the monarch patio. Um This highlights A R P's charitable arm wish of a lifetime which grants seniors the opportunity to pursue long standing passions. We all have those. Um We asked you to vote on which of the seniors featured on the board should win her wish. And we're happy to report that a ARP is declaring all three women winners. Everyone's a winner and they will have their wishes. Granted. There's 100 and one year old woman who uh, flew with Amelia Earnhardt and is going to get to fly a plane again. Yeah. Uh one woman is going to drive a race car and another is going to take dance classes a long, long held passion. So thank you so much for those of you, to those of you who voted and of course to a RP for granting their wishes. Um Yeah. Amazing. Ok, let's get to our discussions for the day. We have a great lineup. Um We're going to start with a visionary businesswoman known for successfully navigating the challenges of the retail industry, driving growth and transformation through strategic and innovative thinking all while leading with purpose in mind. Cory Barry is the CEO of Best Buy. She's been with the company for nearly 24 years rising through the ranks all the way to the top. And we're pleased to note that Corey once again is on fortune's list of most powerful women in business. This year. She joins Fortune, senior writer and MP W co-chair Emma Hinchliff for a conversation on identifying new opportunities, meeting consumer demands and delivering on the promise to enrich lives through technology. Please welcome them to the MP W stage. Hi, good morning, Corey. Good morning. Thanks for having me. Of course. Thanks for helping me take things off of course. Yeah. So, are people buying big ticket electronics right now? And what does that mean for Best Buy if they're not? Yeah. So, I think most people know there was a definite pull forward of electronics purchases in the pandemic. Like, we all woke up one day and we're like, oh, sweet. My office is now in my kitchen and my kids are going to be in the living room and we got all the things right. And we started with computers and then we're like, oh no, I'm going to have to be here for more than six months. And so then we're like, I need a camera filter and then we realized, oh, it's been a year and I'm streaming a lot more. I'd love to have my own home theater and, and you just saw this massive amount of purchase. And so what's happened as we've come out of that? We assumed the industry would pull back. You're just not going to have that kind of elevated demand, especially when you pumped $3 trillion of stimulus into the economy. But what doubled that is as you all know, incredible amounts of inflation. And so people now are prioritizing really? I call it, I'm gonna overly generalize two big things. The basics, food fuel and lodging are up 20 to 30% versus pre panem wages are up at 17%. So you're eating into that savings and they're prioritizing fun. Fun. Taylor Swift. She was just on, like, I'm paying $1000 for that front row ticket. And those experiences are really where people are willing to pay, which means the bigger ticket items in electronics. Not right now where people are as interested, but, but there's a good story there which we'll get to. I'm sure what is the story? A great thing. So, I think we live in a really misunderstood industry. There's like this idea that it's discretionary who here will go today without using some kind of electronics, like in the next 10 minutes, maybe like, right, I have a 17 year old boy and I think if I took the electronics away, I mean, he's got four screens at any given point in time. Right? This is, this is a need. I don't know if you saw the Consumer Technology Association just announced in partnership with the UN. That technology is a human security pillar, things like food community, water now technology because it's so essential to being connected to the world. So you've got this amazing need and there's a larger install base of products than there's ever been. Think about your own house. How many pre pandemic versus post pandemic pieces of connected equipment do you have in your home? Biggest install base ever? And the coolest part about the stuff we sell is it's never static I out highly. And if you do come see me, anyone in here has a computer more than 10 years old, right. It just won't work, the operating system changes, the hardware changes. And the greatest thing about our industry is innovation. And so yes, right now people are pulling back, but the future, the future will only be more enabled by technology. And we are the ones we are the last left standing. We are one of one that knows how to commercialize that new tech better than anyone. Do you feel like, you know, investors, Wall Street, are they on board with your idea that technology is, you know, more of a human, right, and less discretionary spending and how does that affect things like your share price? So the the great thing about Wall Street is they are the most pragmatic thinkers by nature. Like if I'm an analyst or an investor, just like many of us in this room are you are looking for the sure bet, right? So it is always harder to bet on the idea of the future, the idea of innovation, you're going to kind of look for the safe harbor. So I think there is a realization that we are an end of one and that we add real unique value in the ecosystem. And at the same time, you're against a consumer backdrop that is incredibly uneven, which means investors are going to make their own calls about where they want their own safe harbor. Yeah, you know, and some of these indicators are, you said are contradictory. Can you explain that a little. How do all of these signals contradict each other? It's, it's just the most fascinating thing. So I always think about it as a funnel. So let's start at the top with the consumer. The consumer is in a good place and there's a lot written, you know, when does the cliff come right now, the consumer is in a good place. They're spending still at record levels. Yes, debt is increasing but it's like normalizing to what it was pre pandemic. Savings are coming down, normalizing to pre pandemic and they're spending on as we talked about things like services in air quotes, which is restaurants, trips, all those wonderful things that we missed so badly. And um so at the highest level and what's that buoyed by lots of savings, three trillion is a lot of stimulus and a jobs market that I would say defies expectations, right? You still have the lowest unemployment, hundreds of thousands of open jobs. Um So that is helping to buoy but then you take that consumer and you go down into retail. So not even to ce just retail. And because of that trade off between services and inflation in general, people are starting to shift away from spending and it's hit the sub industries at different times. They've started to pull back in pet care, right. Going for more the basics versus the really high end treatments for pets started to pull back in lumber and home improvement where you had 60% inflation for a while. Each of these are kind of hitting at different points. And then when you get into c definitely because of that huge pull forward of demand, that's a place where we've seen people start to, to wait on making some of the purchases. So depending on the consumer, they're gonna prioritize again, especially when it's the basics, they're going to prioritize what's right for their family. And still right now, that experiences, I think after lacking experiences for a couple of years is such a priority for families. So this is a very interesting conversation and we'll open it up for, for questions in a moment. So start thinking, oh, I think we have one right now. Um We'll wait for the my handler to get to you. We'll get right back to you. But um you know, earlier this week, Best Buy announced that you were selling glucose monitoring systems, which I was interested to see. Can you talk a little bit about that strategy? Some people might be surprised to hear that that's something you can buy at best buy. The interesting part of health care is that it is moving into our own hands, right? We are more and more able to buy devices and look at data like I'm wearing my A ring and my order ring told me I didn't sleep very well and I'm very stressed out about being in front of all of you. Uh I have, you know, five devices now that are telling me that and, but it's real, the reality though is this device has become the most accurate predictor of whether or not I'm going to have COVID. If I get up and my score out of 100 is closer to 40 or 50 I might feel fine. But the underlying metrics are pointing to the fact that I'm going to get sick and there are devices like this proliferating. And so our strong point of view is the future of health care will be in labeled by technology. We're actually going into people's homes who have chronic conditions, helping them hook up a number of different devices. We have a data platform that analyzes the geek sweat agents go in and help them. We have data platforms that analyze and get that back to the doctor. So you don't have to stay in the hospital. We are an aging society. I mean, 10,000 people are turning 65 every day. And as far as I can tell, very few of those would like to be anywhere other than their home. And so our bet is strongly supported by data. You're going to be able to start to use more and more technology to also pull cost out of the health care system and take control of your own health care. Well, let's go to our question and please introduce yourself. Hi, good morning everyone. Ashley. Tappin insignia. And you just answered the question, I was going to ask, which was about your bet on health care. So, thank you for that. But so another question is that people are saying that it's harder than ever to be a CEO and wanted to hear your thoughts on that and why that might be for you. My guess is every generation of CEO S has said it's harder than ever to do a CEO. I'd also say it's harder than ever to be a mom. I mean, I think, I think these, all of these are escalating topics for me. I think there are a unique set of challenges that today's CEO is navigating because I mean, we just spent 10 minutes talking about a really diverse, difficult set of business issues. And I and I talked to my team a lot. I mean, it's not just been one major life changing event. We have stacked 10 major life changes. Like any one of those taken alone would be a generational event, an invasion in Ukraine $3 trillion of stimulus, a pandemic. And we have stacked those and so by its nature, no CEO before us, none of you, no one before all of you has had to navigate that stacked set of crises. I laugh because the CEO before me, Hubert Joly left this beautiful array of leadership books in his office that I walked into and not one of them told me what I'm supposed to do at the start of a pandemic. And I looked, and so I think I, I think there is this, this real difficult so you have these business issues and then there is a real stack of social issues and expectations for companies that has not existed before 20 years ago. Your answer as a CEO could be, I'm not gonna give you an opinion on that. We don't talk about that in business. Like that could be a viable answer. That is not a viable answer today, not for my team and not for my customers. And so that's that, then you stack on top of the stack, set of crises. And I do think whether it's CEO or whether it's the leadership roles, many of you play in this room, they have never looked like they do today. And, um, I think you have to build a different level of resiliency and humanity in this role than you've ever had before. Another question back there. Hi, good morning. Uh Jennifer Deon, uh CEO of home partners. Um I'm to uh recovering CFO and just wondering if you could give some advice for the group and transitioning to becoming a CEO, whether it's from CFO or something else and just how you made that mindset shift. Yeah. So, um I, for those who don't know, I was a CFO for three years before I became CEO and I at Best Buy for like 20 something years. Yeah. And so I've had a lot of different roles at Best Buy. Um I think there's a couple of things that were really instrumental for me. I had a CEO who was also very much a mentor to me and stretched my responsibilities as CFO. And I think that can work in any role where I became CFO and the Chief transformation Officer, which by its nature, like left brain, right brain every day, you gotta think about growth and how you're going to drive growth. And I'm on the hook to make sure our SGN A is in line with where it needs to be as an organization. And I think the more throughout our collective careers you push, not just and I just the personal belief, I just don't think you're going to see many linear careers that go like straight up one level of expertise. I think it's going to look a lot more like we call it at best. Buy, we call it a lattice versus a ladder and you're going to spend more time trying to add responsibilities or change just like we're, we're trying to teach the team. Don't just worry about the next rung. Think about how you're going to build the breadth because that is ultimately, I think what makes these days. Uh I'm not saying I'm one. Hopefully I will be but a successful CEO, right, which is you're gonna have to think around every corner of every issue. Um And for me, that was the biggest change from CFO where you're, you're a little bit more linear in how you're thinking to CEO where you will opine on everything from, you know, an invasion in Ukraine all the way to a structural issue about your business model. Um So I was just, I, I'm always recommending add change, push yourself, get uncomfortable. It's way easier to try to be great at like this linear path. You've got to try to make yourself really uncomfortable in your career journey. I think we have another question. Um Hi, I'm Lorraine Harrison. I'm CEO of catalyst. You know, the recent scotus decision around affirmative action has really put um de I and the backlash and de I and all the political things on the front burner. And I'm wondering how you're reacting to that and what do you think the risks are? And how do you look forward to that as a CEO? I think any conversation you're going to have on this topic has to be anchored in who you are as a company and your values. So if I, if I just take a step back, we've been a company for 50 plus years and I actually just had a chance to sit with our founder, Dick Schultz. He's 82 and Dick from day one, talked about stakeholder capitalism and it never being one or the other. It being a balance and that is employee that is customer that's vendor partners, it's your communities, it's your shareholders in the employee piece. Then you have to decide as an organization. Again, culturally, what are you trying to do? We've been very clear, we are trying to create a culture of belonging, not because it's a nice to have because it clearly is the number one driver of employee engagement and high employee engagement. Empirically, data driven says delivers better financial results over time period. And so our focus on belonging. Now there's lots of different tactics that we can use to create that culture of belonging. And I'm very lucky, we have an incredible, we have 90,000 employees. We have an incredibly diverse set of employees and employees who want to lean in and help us create this culture. And so our focus has been always since day one and is still the employee and their engagement with the company. And that sense of belonging is crucial to that experience. And so, however, you now whatever the changing environment is like outside, I said out outside our proverbial walls, we stay really focused on the culture and the environment that we are trying to create. So Corey, you became CEO in your early forties, you spent most of your career at best Buy, what comes next for you? I should I have the luxury to choose that. Um I would laugh and say there's lots of things you choose as CEO. How long you're one is not one of them sometimes, um, you know, my, my truly joking aside, my, my real dream is someday I'd love to give back and I, I'd love to give back as an educator. I have a deep respect for the educators in my life and I have a deep thirst for education. Um, and, you know, I have two kids. I have a 17 year old and a 13 year old. And, um, I would love to be part of, you know, the, the kind of network and fiber that builds our next generation. So maybe someday I'll, I'll get that chance. Well, thank you so much, Corey. Thank you.