Last year, retail giant Best Buy (NYSE: BBY) made waves with the $800 million acquisition of GreatCall — a company that offers smartphones, smartwatches, medical alert devices and other technology tailored to older adults, and counts senior living companies among its clients.
Now, that big investment is starting to pay off for Best Buy.
“In health, we acquired a leading connected health services provider for aging consumers GreatCall and took a tangible step forward in our strategy to have seniors live longer in their homes with the help of technology,” Best Buy CEO Hubert Joly said Wednesday, recapping Q4 and full-year 2018 earnings on a call with investors and analysts. “Since we acquired the company in October, the integration has been seamless and the value creation opportunities we envision have begun to materialize.”
The Q4 earnings for Minneapolis-based Best Buy exceeded the expectations of Wall Street analysts, thanks to strong sales, particularly over the holidays. The company has reported at least 3% sales growth every quarter for almost two years, CNN Business noted in a report published Wednesday.
GreatCall contributed to Best Buy’s financial success. For its domestic U.S. stores, revenue was down, largely due to location closures — but these declines were partially offset by 3% comparable sales gains and revenue from GreatCall, Joly noted.
Going forward, Best Buy intends to drive growth in its health business by expanding GreatCall’s devices and services.
“As children of aging parents, many of us would appreciate the potential power of our health monitoring service that enables seniors to live longer in their homes, while reducing related health care costs,” Joly said. “We’re currently in pilots with a number of managed care organizations. And over time, we believe this could become a material growth opportunity for us.”
In January, GreatCall announced a partnership with insurer CNA, to provide policyholders with passive remote monitoring and medical alert devices.
While this program — and Joly’s comments on Wednesday — focused on serving older adults living at home, GreatCall also serves senior living communities; B2B sales channels will be another area of ongoing growth, Best Buy Senior Communications Director Jeff Shelman told Senior Housing News last August.
The GreatCall deal fits into Best Buy’s larger strategy. The company wants to not only sell technology products but be a provider of consumer services and supports, including in a “consultative” role, Joly said Wednesday.
Such an approach could have an impact in senior living, if it means that a company with the size and scale of Best Buy is providing support for monitoring technology on the GreatCall platform. And it’s also a business strategy that senior living providers might be wise to emulate.
“This is an approach that senior living providers should be fostering every day — namely, looking at interactions to take a consultative approach, observing and providing support and solutions for older adults and their families besides simply providing a roof overhead,” Senior Housing News Executive Vice President and co-founder George Yedinak wrote in a column last October.