Who Will Buy It?

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That is not to say Anderson's strategy doesn't carry risks. By varying the merchandise at segmented stores, argues Geoff Wissman of researcher Retail Forward, Best Buy will become more complicated to run, and that could drive up costs. (Anderson says adjustments in inventory management will allow centricity to work efficiently on a large scale.) Best Buy must also read each of its local markets correctly and hire sales personnel carefully and effectively enough to make the murky area of service a distinguishing characteristic. Analyst David Ricci of William Blair says Best Buy was forced to scale back its segmented stores in Chicago in part because the staff was not sufficiently prepared. "We are still learning," says Michael Linton, Best Buy's chief marketing officer. "We've just scratched the surface from a marketing perspective."

Anderson admits there are pitfalls. "The biggest single risk," he says, "is that [centricity] is tremendously challenging to our employees." Meanwhile, the business skills that successful employees do pick up could make them tougher to retain. But with Wal-Mart bearing down on Best Buy's turf, the true risk might be to do nothing at all. As Bain's Rigby observes, "Growth is risky. But so is stagnation." --With reporting by Sarah Sturmon Dale/ Minneapolis and Laura A. Locke/ Santa Rosa