I actually learned about this from Jimmy Fallon who joked something about “…the Geek Squad coming to rescue grandma when she falls down in her house…”
Here is part of the actual news release:
Minneapolis, August 15, 2018 – Best Buy Co., Inc. (NYSE: BBY), a leading technology products and services provider, today announced that it has signed a definitive agreement to acquire GreatCall, Inc. for $800 million in cash.
GreatCall is a leading provider of connected health and personal emergency response services to the aging population, with more than 900,000 paying subscribers. It has an award-winning approach to customer care that helps older consumers stay independent longer, provides peace of mind to family caregivers and reduces health care costs. It offers an innovative combination of easy-to-use mobile products and connected devices tailored for aging consumers. In addition, GreatCall has a range of services, including a simple, one-touch connection to trained, U.S.-based agents who can connect the user to family caregivers, provide general concierge services, answer service-related questions and dispatch emergency personnel.
The acquisition is a manifestation of the Best Buy 2020 strategy to enrich lives through technology by addressing key human needs. It is specifically focused on addressing the growing needs of the aging population with the help of technology products, services and solutions. The health space is a large, growing market where technology can help in particular address the needs of aging consumers, their caregivers, payers and providers. Today, there are approximately 50 million Americans over age 65, a number that is expected to increase by more than 50 percent within the next 20 years.
Best Buy currently has a growing business selling health- and wellness-related products. It also has recently been investing in health-related initiatives focused on the aging population that have included the participation of several of the nation’s leading health care providers and insurers. The acquisition of GreatCall will augment Best Buy’s existing efforts in the health space, help bring compelling solutions to more customers, and help fuel Best Buy’s further growth in the consumer and commercial markets.
“Since the launch of GreatCall, we’ve focused on providing the very best technology and services to the aging population, giving them and their families the peace of mind that comes with the right technology and support to help keep them safe and improve their lives,” said David Inns, CEO of GreatCall. “We are excited to partner with Best Buy to serve the active aging population on a bigger scale. GreatCall is already a growing, profitable business with annual revenue in excess of $300 million. By joining forces, we can do even more for this population, combining our products, services and expertise with Best Buy’s customer focus and scale to meaningfully expand our reach.”
Best Buy revs up interest in senior caregiving in 2017. Then came a few years of observation, not to mention struggling store business results (2014) in the face of rising online competition. It had already seen (and revamped) the service opportunity with Geek Squad, in 2012, partnering with AARP. Helping older people with technology in their homes – could that have revealed a sizable customer base of opportunity for more services? By 2017, Best Buy had begun a limited offering of a contracted service called “Assured Living” that uses remote monitoring and other technologies to help older adults, then rolled it out broadly later that year, now in 21 cities across the US. In 2018, it began loud hints about the opportunity in health technologies and the elderly.
Today, Best Buy increasingly is a services company. Besides Assured Living advisors, along with its 20,000 Geek Squad workers, now its offering an in-home technology advisor service (note the example in that article about a visit to the Villages in Florida). With all of that successful investment in people and services, what else could Best Buy need? How about a large call center well-trained on speaking with and providing technology advice to older people, offering responses to users of phones and personal emergency response pendents? So the acquisition yesterday of GreatCall can be viewed in this larger context — a steady progression of filling in an increasingly robust menu of offerings to serve the 50 million people aged 65+ in the US and their family members.
What is Best Buy getting for its $800 million? Quite a bit, and likely what it does not have. Best Buy has long partnered with GreatCall, offering its products in the store. Besides 900,000 service subscribers, Best Buy acquires an employee base familiar with the older adult market (one of the few $300 million firms that can make that claim). In addition, Best Buy acquires a series of small-dollar apps and services that can provide substantial value to older adults – including MedCoach, CheckIn Calls, UrgentCare, and Wellness Calls – among others. Does all of this mean (as much media has nonsensically declared), that Best Buy is moving into the healthcare market? No more than it was in it previously – GreatCall was not in that market – it was in the market of serving older adults with engagement, connection, and safety technologies. To date, none have viewed these capabilities that way, or GreatCall’s price would have been more like Amazon’s $1 billion purchase of PillPack – paying more but getting less.