Bed, Bath, and Beyond Hbr Case Study Answers

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Bed Bath & Beyond Case Study

Feinstein and Eisenberg founded a small chain of stores called “Bed n Bath” in 1971. They operated their small chain of stores in the New York and New Jersey market where they offered bed linens and bath accessories in their stores. Feinstein and Eisenberg saw an opportunity for growth in extending their offerings beyond just bed linens and bath accessories. They quickly changed their small store format in 1985 and headed towards the superstore business model. With the change in business model came a change in the company’s name, they renamed the company “Bed Bath & Beyond” in 1987. Their stores would now carry a myriad of products with a full-line of domestic home furnishings and merchandise. The first step in making the switch to the superstore model was to expand the stores in which they currently operated. In 1987, they had 20 stores and they quickly began to plan the expansion of their stores’ square footage. The average superstore at that time was approximately 40,000 square feet. As they began to convert existing stores into superstores, they also began to find new store space to build out their superstores. The new model relied on Bed Bath & Beyond being able to provide home furnishings and merchandise at a 20% to 40% discount compared to department stores. Feinstein and Eisenberg also stressed customer service and believed it was the key to success. They spent very little on marketing or advertising which meant they relied heavily on word of mouth marketing. They wanted customers to have the best experience and naturally they would tell other consumers about their superb customer experience at Bed Bath & Beyond. Feinstein and Eisenberg also believed customer service was essential to success because they relied on repeat business and growing sales numbers at their existing stores. Essentially, Bed Bath & Beyond looked to provide superior customer service that was beyond what their competitors...