Best Buy Canada Evolved Its Business Model and Became a Marketplace Leader

Tzipi Avioz
November 19, 2019
Best Buy Canada Evolved Its Business Model and Became a Marketplace Leader
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Best Buy is the number-one retailer of consumer technology in Canada, with over $4 billion in annual revenue. It has over 280 million visits to its stores and eCommerce site each year. Now in its fourth year as a marketplace operator, Best Buy Canada is one of Mirakl’s highest-performing clients, a true Platform Pioneer.

In just a few years, Best Buy Canada has fundamentally shifted the way that it does business with the marketplace model. In 2016, the first year that Best Buy Canada’s marketplace was operational, 1 in 12 transactions were fulfilled by third-party sellers. By the end of 2019, that number will be closer to 1 in 4. With the help of marketplace, Best Buy has grown its product assortment to over 1 million products, and its approach to eCommerce has evolved. Its pioneering strategy is paying off in a big way.

The evolution of Best Buy Canada’s marketplace


In the early stages of the marketplace, Best Buy Canada’s strategy was to use third-party sellers to broaden its offerings outside of its core catalog.

As a result of introducing its marketplace, the retailer has achieved dominance in new categories: now, Best Buy is one of the largest online retailers in Canada for luggage and fitness equipment, and has a significant share of the market for baby goods and baby gear, among other categories.

As these successes began to stack up, the retailer underwent a fundamental shift in its approach to the marketplace. Rather than trying to supplement its core assortment with marketplace offerings in adjacent categories, Best Buy Canada now allows marketplace sellers to participate in core categories – changing the way that the buying, eCommerce merchandising, and marketing teams approach their roles.

Best Buy’s goal today is to be the #1 technology marketplace retailer in Canada. Having its own marketplace ensures customers can find everything related to tech at Best Buy.


In our second year, we really transformed our way of thinking to be, “Best Buy is a marketplace where we strive to be the best seller, and have the best price, the best reviews, and the best fulfillment times.” That was a turning point for us to really get the proper amount of integration and collaboration across the enterprise. Brendan Toupin, Director of eCommerce, Best Buy Canada

Best Buy has a seller-agnostic strategy, evaluating where the company should invest in owned inventory, and where the retailer’s network of third-party sellers can facilitate a better outcome for both the customer and the business.

The result is more than just a wider assortment for Best Buy Canada customers. With the marketplace strategy, Best Buy is more profitable in categories where it had previously lost money, like furniture.

The big question: what about cannibalization?

Even in year four of Best Buy’s marketplace, concerns about the dreaded “cannibalization” of owned inventory by marketplace sellers still come up.

Currently, while marketplace sellers do compete against the retailer in core categories, Best Buy Canada doesn’t have multi-seller offers against core SKUs. Everything that marketplace sellers bring to is new inventory that Best Buy didn’t have before. But cannibalization isn’t just about sellers competing on the same product – it’s about sellers competing in the same category. On a broader level, Best Buy’s approach to its assortment makes room for both.


My answer to the teams that are worried about cannibalization is, they're sellers. They have a business model and they're going to sell that product at that price. So if it's not on our platform, it's going to be on somebody else's. We might as well make the commission off of it, get that customer data, and own that transaction. Brendan Toupin, Director of eCommerce, Best Buy Canada


Brendan Toupin, Director of eCommerce (left) and Candice Walker, Senior Manager, eCommerce Retail (center) joined Mirakl on-stage at the 2019 Marketplace and Platform Summit in Boston.

The opportunities (and challenges) of Best Buy Canada’s marketplace

With its marketplace, Best Buy Canada has been able to grow its selection of products across all of the categories that it offers – and there are a lot of them. Best Buy Canada has 1 million SKUs on its eCommerce site now and is building capacity to increase this ten-fold.

With this growing selection from marketplace sellers, the retailer is becoming a true one-stop shop in consumer electronics. Now, when Apple or Samsung announces the launch of a new device, Best Buy is able to leverage third party sellers to ensure breadth of assortment in supporting categories like chargers, cases and other accessories. It’s able to deliver a more curated experience, offering the assortment of accessories that its customers expect to find when they’re shopping for their new devices.

The introduction of third-party sellers has also created new challenges for Best Buy’s eCommerce team. Categories on that previously held 100 products have grown quickly – up to 10,000 products, in some cases – which introduces new complexities around all of the elements that customers use to find the product that’s right for them, such as hierarchy, search, facets, and filtering.

Candice Walker, Senior Manager, eCommerce Retail at Best Buy Canada, shared one story in particular to illustrate these challenges, known internally at Best Buy as “the pillow debacle.”

As she explains it, “Pillows are probably not what you think of when you think of Best Buy – we weren't really in the pillow category. Then we brought on a seller who brought us about 500 pillows across 12 different pillow sub-categories. The problem became obvious when one of our senior leaders woke up from a bad sleep and decided he needed a new pillow. The search experience was not good. When you have a handful of SKUs, you don’t need sophisticated filtering tools. We suddenly needed to improve findability.'

“Long story short, we swiftly put a team together to address some of these issues with findability. We're still working through a backlog of content enhancements that we need on the site to make it shoppable with the volume of the assortment that we have now.

"Walker’s advice: keep the customer at the center. “It's about looking at where there's the most ROI to improve the content and search, and making the experience right for the customer.”

“It’s a critical component of our growth strategy”

For Best Buy Canada, the marketplace strategy delivers.


We are happy with our decision to add a marketplace. We're on our fourth year, and I even think that we were too slow. Marketplace is part of our corporate DNA, and sales are a critical component of our growth strategy overall. Brendan Toupin, Director of eCommerce, Best Buy Canada

Watch Best Buy Canada’s session at the Marketplace and Platform Summit

Written by
Tzipi Avioz
Executive Vice President, Customer Success at Mirakl

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