Best Buy sees "tough" holiday

NEW YORK Fri Nov 27, 2009 4:26pm EST

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NEW YORK (Reuters) - Best Buy's (BBY.N) chief executive said he was seeing strong crowds on Black Friday as customers flocked to buy gadgets and electronics on the big shopping day, but warned the trend might not continue.

"I think it is going to be a tough holiday season... The brands that have lost connection with their customers are going to have difficulty," CEO Brian Dunn told Reuters in a telephone interview.

Dunn expects more customers to shop closer to Christmas and sees the holiday shopping season stretching into January.

On Black Friday, Best Buy saw "strong customer interest" in smartphones, netbooks, notebooks, flat-screen TVs and digital cameras, he said.

From promoting its "Twelpforce" to answer consumer queries and offer tech advice on Twitter to hiring more seasonal workers this fall, Best Buy has upped the ante on customer service to woo shoppers. It has also worked on keeping its prices competitive.

CEO Dunn termed the results from the "Twelpforce" initiative "phenomenal" and said it was appealing to shoppers in a big way.

"It shows the power of this connected world. Three a.m. in the morning, you are at home, who are you going to call? You tweet 'Twelpforce' and there somebody is," he said.

The consumer electronics chain has also benefited from the demise of former rival Circuit City CCTYQ.PK and local chains curtailing growth, even as it faces stiff competition from Wal-Mart Stores Inc (WMT.N) and Amazon.com (AMZN.O).

Best Buy shares were down 1 percent, or 43 cents, at $42.83 Friday afternoon on the New York Stock Exchange.

(Reporting by Dhanya Skariachan; editing by Gunna Dickson)

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