A Best Buy employee decided to test the retailer’s new marketplace by ordering a VR gear, but instead received a product that looked like it came from a cheap 3D printer, with visible layer lines, flimsy materials, and not something that resembled the quality Best Buy built its reputation on.
This is just one of the problems that is flooding Best Buy’s return counter, three months after the electronic giant launched its riskiest strategic bet, an open marketplace with thousands of third-party sellers, in a way to compete with Amazon’s dominance of online sales. Whether it is product quality, defective Items or problems with the rollout, they have triggered delays and customer complaints that reveal costs that the company didn’t anticipate.
“There have been a number of issues with the rollout on marketplace,” said people familiar with store operations who spoke on condition of anonymity. “Any time one of these programs comes out, there are all kinds of issues that happen, usually from people taking advantage of loopholes.”
These problems reflect Best Buy’s riskiest strategy shifts in years: adding an open marketplace with thousands of third-party sellers to its brick-and-mortar. But the company’s launch comes without sufficient employee training or store preparation, leaving its workers scrambling between returns and products they’ve never seen before and its clients disappointed for not getting the service and product they paid for.
Issues with the implementation and integration with the stores are making it more difficult. Marketplace items don’t automatically apply labor costs for installations as they should; “some products appear to be dropshipped from sites like Alibaba or AliExpress,” said people familiar with the matter and added that the number of the same product increased dramatically, like remote starter options, jumped from six to over 2,000.
Still, many store shelves remain empty.
Credit- Delfina Marchese
“Product quality is definitely not being checked,” said people familiar with the matter.
By copying Amazon’s playbook, more than a strategy looks like a fast move to catch up and compete with the giant, which controls nearly two-thirds of the online sales in a race that started more than 15 years ago, and that Best Buy is just joining.
Today, E-commerce represents 16.3% of total US retail sales in the second quarter of 2025, up 3.9% from a year earlier, according to a report by the U.S. Census Bureau News. This highlights the importance of adopting an online shopping strategy that would help ease the pressure that brick-and-mortar retailers, such as Best Buy, are experiencing under the continued shift in consumer demand and economic uncertainty.
“It’s competing against just absolute behemoths like Amazon and Walmart and at the same time, you have more of the segment going online,” said Matthew McCartney, Equity Research Media & Entertainment at Wedbush Securities. “That’s a tough place to be when you’re a really large brick-and-mortar retailer of electronics.”
Sellers can apply to Marketplace platform through a four-step process that, after approval, would allow them to grow their brand with guidance in marketing, pricing and exposure in Best Buy’s website and app. For buyers, the platform integrates online shopping with their physical stores, letting customers return their marketplace purchases at their local Best Buy shop.
For Best Buy, Marketplace marks a shift from its core business of owning inventory to organizing it. In an environment where slow demand for electronics is rising, allowing sellers onto its site, the retailer not only expands its product variety but also reduces supply chain and warehouse costs while experiencing a boost in web traffic.
The timing is critical. The new venture comes at a time of economic uncertainty, with consumer spending stalling and tariffs raising prices. The company has reduced its reliance on China to 30% of electronics (down from 55% earlier this year) and 40% from Vietnam, India and Taiwan.
Best Buy is also highly dependent on the holiday season for its annual profits, which makes the retailer vulnerable to unexpected disruptions like shifts in consumer demand or in supply chain, making the diversification of its revenue through initiatives like marketplace increasingly important.
“When you have third-party sellers, that means that there’s way more logistical things to keep track of in terms of the integrity of the products as well as the security of the customer’s information,” said Georgia Kourkoumelis, engagement manager at Consult Your Community, a pro bono Consulting Services firm for small businesses in New York City. “When I shop on Amazon, I’m super aware of the seller because I know that there is that susceptibility or there’s that risk of fraud.”
Beyond Marketplace, the retailer is developing an AI search tool that will help customers find their products more efficiently and quickly. The technology is expected to launch during the holiday season and is intended to use helpful prompts to guide the customer to find what they are looking for.
A study by Emarketer, a market research company, suggests that consumers who noted positive impacts from AI cited faster and easier shopping.
“The biggest appeal for consumers and just businesses in general with AI, is the fact that it kind of makes everything quicker, easier, and less time-consuming,” said Kourkoumelis.
Many businesses in the retail sector have incorporated marketplaces into their strategies over the last decade. From Walmart to Target to Macy’s, all leaned towards expanding their digital businesses to broaden their product offerings while also earning from each vendor. Best Buy’s challenge is not only to catch up to its competitors but also to prove that it can still be reliable with a third-party business model.
“The key question is will it be enough to move the needle given the large scale of Best Buy overall?” said Bradley Thomas, Managing Director at Key Banc Capital Markets. “The more important factor for Best Buy right now is the state of the entire consumer electronics industry.”
For Fiscal year 2026, analysts expect revenue of $ 41.77 billion, a modest 0.6% increase from 2025.
Stocks have fallen 5.7% this year, significantly underperforming the S&P’s 16.43% gain, showcasing analyst concerns on the company’s ability to navigate the uncertainty in the economy and the shift to an e-commerce model.
Best Buy Marketplace could “help create a profit stream that the company can use to either help subsidize their core retailing operations or bring more to the bottom line, ” said analyst from Truist Securities, Scot Ciccarelli, in a note.
But inside stores, people question if abandoning what made Best Buy different makes sense: “Our biggest strength is in having experts for people to come and talk to in person and be able to get their research done without actually having to go online and spend a whole bunch of time doing it,” people familiar with the matter said. “That’s always been our biggest selling point.”