Tough times continue for Best Buy. The latest news is that the company’s cash-flow expectations were lowered because payments on inventory had to be made earlier than expected.

This was not Best Buy’s fault. It received inventory sooner than expected and had to pay for it sooner too. But this perpetrates the negativity surrounding the Best Buy brand.

The overarching problem with Best Buy is that nothing has been done to stabilize its brand. On top of that, the company refuses to adapt to the changing competitive landscape – which brought down Circuit City – and is fending off takeover bids from founder Richard Shulze.

The Best Buy brand extends only as far as one of its blue-shirted employees can take it. Online retailers have been devouring Best Buy’s market share. That cannot be attributed only to the overall woes of brick-and-mortar stores. Apple outlets, by contrast, are packed with customers.

The responsibility of any company with brick and mortar is to create enough of a brand that it becomes a destination. Best Buy should reexamine the experience its brand creates and figure out why it is no longer meaningful to its customers.

Why does the Best Buy customer use Best Buy? Why do others reject it? Who does the Best Buy customer believe they are? How does Best Buy reflect that? Is the Best Buy customer seeing Best Buy as easily interchangeable with other stores like Target or Walmart and what is driving those feelings?

These are important questions. The fact that little has changed at troubled Best Buy indicates that the critical questions are neither being asked nor answered.

Best Buy’s future is gloomy, unless it examines its brand closely.

With the release of the iPhone 5 behind it and only iPad Mini speculation to fuel the Apple buzz-o-sphere, recent tech news has filled the void with reports on the company’s patent lawsuits. The question Apple must ask as the spotlight grows on its muscular legal battles is whether legal actions are good for business or do they tarnish the shiny Apple brand?

As Apple stock flirts with the 700 mark, the company has been dubbed the most valuable in the world. But it wasn’t always so. Before iPods, iPhones and iPads, Apple had only about a 2 percent share of the computer market.

Even as an underdog, Apple cultivated its clean and simple “Think Different” brand. Rapid growth brought with it a delicate brand-balancing act that dated back to its iconic “Big Brother” 1984 Super Bowl commercial introducing the new Macintosh computer to America.

Once Apple emerged as the market leader it ceased being the underdog and reluctantly became the establishment.

Apple’s brand is so carefully crafted that legal actions against competitors could backfire. For instance, sales of Samsung phones rose sharply after Apple recently won a $1 billion lawsuit against its main competitor.

The Apple customer that “thinks differently” doesn’t react well to headlines about lawsuits brought by Apple against other companies in the market. These lawsuits may make perfect business sense, but they weaken Apple’s image.

Beyond that, the suit charged that Samsung copied the iPhone’s look and feel. As a result, the legal victory actually reinforced the belief that there was little difference between the two products. By prevailing in court, Apple damaged its brand.

Apple has never been the brand of the bully. Aggressive lawsuits against competitors could change that.

Over the past month, two pieces of news have caught my attention. The first was Sony’s purchase of Gaikai, a cloud-based video game site that allows big-named game titles to be played through an Internet browser. The second was that Ouya, an inexpensive game console that runs the Android operating system and Android-based games, is teaming up with OnLive to allow cloud gaming of some AAA content.

These moves have exciting and curious implications for the market. It’s exciting to see the industry rumbling towards digital, which will lead to the instant ability to play and be simple to use.

But how will the existing brands transition?

It will be interesting to see what, if any, integration Sony has planned between Gaikai and its next Playstation. Sony puts a lot of weight behind its high-priced hardware, using it to push new technologies. But streaming services, like Gaikai, don’t require much in the way of hardware. The Ouya is set to sell for $109 and that includes the processor chips, storage, etc.,needed to run Android-based games that would be downloaded to the unit. That $109 ticket price is quite a bit less then the $599 pricetag Sony slapped on the original 60GB PS3 in 2006.

Because of Ouya’s marriage with OnLive, Sony will have to think very strategically about how it utilizes Gaikai. If the company is too soft in its approach, Ouya has an opportunity to take market share. Sony needs to be aggressive, which means stepping out of its comfort zone and leaning more towards software than hardware.

There is a happy medium. Sony can achieve profits for its system and still retain preference for its brand, but if OnLive is successful at acquiring larger amounts of AAA content, Ouya’s existence will eat away at Sony’s margins.

Sony’s best bet is to champion the digital change rather than react to it.

Since the first time I watched the NCAA basketball tournament using streaming services, my selfishness has pined for the day when the rest of television makes the same transition. The simplicity of signing on and watching, without a contract, a high bill and still in HD, has made me wonder, when will the change happen universally?

HBO Go is a good example of this, bridging the divide between streaming and cable, while not currently committing to fully streaming without being a cable subscriber anytime in the future. My only hope for a more simplistic future where I choose only the channels I want rests in Apple or another company with enough brand permission to allow for such a drastic change.

Brand permission dictates what the customer is willing to believe about the claims a brand makes. Tablets, for example, seemed like a long shot at catching on initially. (They didn’t replace a phone or a computer, but instead added a new category.) Not everyone could have pulled it off, but Apple had the brand preference as well as the brand permission to prop up the category and facilitate the transition. It was a big idea and far away from the status quo, which is what Apple represents.

So this is my plea to the Apples of the world. “Please do something about cable.”

My second plea is to those without the brand permission for it. “Please don’t do anything about cable. In fact, stay away.” For change to happen, it must be an unavoidable wave of change. And it must be believable.

Until this change is tackled by a brand with adequate permission, the inertia of rest will continue, and I will have to keep using Time Warner Cable. Sigh.

I hate to harp on Best Buy yet again, but boy, when it rains it pours. Best Buy CEO Brian Dunn unexpectedly resigned due to a personal conduct investigation underway and all I could think was what a lucky break it is for Best Buy.

Not lucky in the sense that he was bad at corporate management or that he was a bad person (I guess the personal conduct investigation will clarify that). No, the only way I can evaluate Mr. Dunn is through the perspective of brand. From that perspective, Dunn was failing.

When Stealing Share rebrands companies, as much effort is put into the internal corporate culture of the brand as into the customer facing portion. If they do not occur in tandem, the customer sees the brand as hollow and fake. Before a brand can become important it must first be believed.

As I’ve said in recent blogs, Best Buy confuses its awareness with brand equity. The detriment of this confusion is that brand provides clarity and, in the absence of it, Best Buy suffered. Dunn focused too heavily on best practices and, as such, the brand of Best Buy became only as valuable as the lowest common denominator. Importance flows like a river, high to low. What a CEO believes is important becomes important at the ground floor. Brand must be the driver for the new CEO or Best Buy will continue to hit the same obstacles it is currently trying to clear.

A new CEO focused on brand also ushers in a new corporate culture. A big problem with promoting best practices (beyond their lack of meaning with the customer) is that they are not emotional and are the table stakes in which you must have just to play. But they do not create preference. They also give employees little reason to care because they are difficult to take personal ownership of.  As a cooperate culture, it is much easier to live something like “Think Different” than it is to live “best price.”

Best Buy’s Board of Directors should look at this resignation as a fresh start. Wipe the slate clean and take a new approach. Recognize that what Best Buy is missing does not center on operations, but rather on brand. Best Buy is down, but with some meaning it will not be out.

Things are not looking very good for Best Buy. Its last quarter, which ended March 3, had it down by $1.7 billion, a figure even more disheartening when you consider that the loss included an additional week of sales to help soften it. Best Buy’s answer to the poor performance is a shift toward fewer big-box locations and an increased amount of mobile locations. There is one problem with the strategy however. Whatever issues it has with the big-box stores will be the same for mobile stores. Neither has a clearly stated reason for being nor a compelling enough message to establish brand loyalty.

The problem with Best Buy’s current big-box stores is that you can get everything they carry elsewhere. Its brand is not special nor are the products it sells, making it just a store rather than a destination.

Sure, it has a large selection that lets you get all your electronics/appliance shopping done. But how many people go out to buy a TV and a fridge on the same outing? Typically, you either go for one or the other. (Or you go to Costco.) If you are in the market for a fridge, Best Buy just joins a long list of stores whose value is also simply “a means to an end.”

On the other hand, if you want IKEA furniture, you go to IKEA. If you want a MacBook, you go to the Apple Store. There is value in IKEA and the Apple Store because of the experience, the focus and, most of all, having brands that offer something of greater value to the consumer than price. Best Buy is not a very pleasant shopping experience. Nothing it sells is particularly special, and it uses the rather emotionless value of price as its brand.

So are mobile stores going to be any different?

The problem with transitioning to more mobile stores is that too many mobile stores exist and Best Buy’s brand of price is not meaningful enough to increase usage beyond their stores’ proximity to consumers. AT&T, Verizon, RadioShack, the list goes on. Mobile stores already saturate the market.

Best Buy’s success does not rest in adjusting the size of its stores. It rest in adjusting its brand. Downsizing the stores is just addressing a symptom. It’s not addressing the cause.

Instead, Best Buy must decide who is it for and who is it not for. What does the brand promise? Best Buy is confusing its brand awareness as being meaningful when it is preference that signifies brand equity. The reason Best Buy is closing stores, laying off employees and switching to a mobile store model is because it hasn’t redefined its brand and used that to dictate structural changes.

Otherwise, it will soon become as irrelevant as RadioShack or, gulp, Circuit City.

Over the past year or so, retailer Best Buy has been trying to establish a presence in the used game market. The transition has not been immediate. Over time, it has established a small pre-owned section, dedicated game trade-in kiosks in the store, and a subscription-based game magazine. Best Buy has done a relatively decent job getting itself up to speed on the table stakes needed to compete, but now it needs refocus its brand if it ever wants to get an edge over the 800-pound gorilla, GameStop.

I say this primarily because of something I noticed this week. On Sunday, I was in a Best Buy and noticed a big advertisement that, for one week only, it was offering 50% additional trade-in credit for games. On Monday, I was on the other side of town and noticed, plastered on the window of a GameStop, that, wouldn’t you know it, GameStop was offering 50% trade-in credit for game trades for one week only.

A word to Best Buy, GameStop is watching and has the ability to match whatever great offer you create to get game trades through the door. The impetus for traders must come from something other then a percentage of credit. It has to also be in tandem with a brand that says why you are offering the discount and why it should be important to customers.

Best Buy’s “Thousands of Possibilities. Get Yours.” brand position had a bit of that potential, but it’s not nearly emotional enough.

The difficult part of entering into the used game business is not location, customers, or even prices. Those are problems that arise down the road. The problem before you even get on the road is inventory. You can’t sell pre-owned games if you have no stock to sell, and inventory is something GameStop has plenty of. Best Buy’s pre-owned section is small. BestBuy’s used section could fill a small single row of shelves while GameStop can fill a store.

Best Buy’s game trade effort is a lesson in confusing table stakes with a reason to choose. If price is the only deciding factor (and inventory), then GameStop will win every time. Best Buy is in desperate need of a rebrand. It needs to uncover a meaningful idea within the market and claim it. That’s the way it can beat GameStop at its own game.

GameStop’s success certainly proves there is a market for pre-owned games, but not if the switching triggers are category table stakes. Then again, my belief is that, regardless of deals, inventory, and customer loyalty, both GameStop and Best Buy will both face future challenges when the industry transitions to digital distribution.

It’s only a matter of time until that happens and only a meaningful and different brand can create preference during the transition.

It seems that Reed Hastings, CEO of Netflix, is quietly in talks with cable companies in a possible attempt to add the Netflix service as an add-on to cable. The move, which would give Netflix greater reach and would give cable providers an additional bundling element in their line-up, might appear to be a win-win on paper. But the effect on the Netflix brand would not be a positive – nor is it the right step in aligning with the future of delivering content.

In any discussion I have had with friends and colleagues, I have yet to find someone who speaks highly of their cable service. The service is never great, the prices are too high, you are not able to pay only for the content you want and you have little control. In addition, cable represents the “middle man” between the creator of content and us. With streaming video (HBO GO, any one?), cable companies are nearing extinction.

Netflix was wise when it initially focused on DVDs and it was even wiser when it made the transition to instant streaming.

The biggest hurdle for Netflix is that, even though there is a lot of content it streams, the content is too incomplete. You still need to supplement Netflix with cable, satellite or another streaming service like Hulu. Its focus should be on closing this gap, not bridging it. When I go to Best Buy, I often have a hard time killing time browsing. I used to be able to that with ease. Now, though, there is just a lot of obsolete space. I have no interest in browsing the CD collection or DVD collection, which consumes most of the middle of its stores. I have seen the future in digital and have no use for hard copies anymore. This is my feeling about cable. I have tasted instant streaming, be it ESPN3, Netflix, Hulu, or iTunes, and streaming tastes oh so much better.

Apple famously is quick to do away with outdated technology before the rest of the industry (removing the diskette drive, adopting USB, avoiding Flash).  It always stays current and ahead of the curve because it is the one making the curve. (In Walter Isaacson’s book, Steve Jobs, Jobs said consumers don’t know what they want next until they have it.) Netflix must do the same. I don’t want to have another reason to remain with my cable provider. I want someone to give me a way out.

With the advent of smart TVs, game consoles, and set-top boxes, all connecting to streaming services, Netflix‘s ability to reach the market will continue to sufficiently expand without having to align with cable providers. If you lay with dogs, you will wake up with fleas. Remember this Netflix, because my cable provider is covered in them.

In a recent blog about Pepsi, I mentioned that only brands with different values than the competition can steal market share. Brand works in collaboration with this value by providing a meaningful context so its meanings become more intensive then the claims of the competition. I have, for a very long time, been very critical of RadioShack, or “The Shack” (which it is only using sparingly anymore). I could never pinpoint RadioShack’s differentiator, nor could I find brand meaning to help me overlook the absence of it.

The biggest problem for RadioShack is that it has identity issues. “Radio” is just a wee bit antiquated and I have yet to meet someone who conjured up a positive image when they thought of a “shack.” Now that we live in a different technological age, RadioShack just does not know what it wants to be when it grows up.

The in-store setup of RadioShack, in theory, reminds me of a boutique because of its relatively small size, which usually means focus and speciality. My wife is fond of shoe boutiques because she can get special and hard to find pairs of shoes. Some of those small boutiques even get early runs of an item so that the same design found at a Neiman Marcus might actually be made with a slight nuance.The point being, a boutique experience feels special.

RadioShack however does not feel special. In fact, almost all of RadioShack’s selection is lackluster. Sure, it has TVs, but it carries only about five of them. Need a videogame? Don’t go to RadioShack, it only has a handful to choose from. Its selection might increase when you look online. But if you are an online shopper looking for best price and biggest selection, wouldn’t you just use Amazon or someone else?

RadioShack has not put a stake in the ground, either from a brand perspective or product perspective. With so much left undefined by the company, it forces the consumer to create meaning and value (or in this case a lack of it) on their own.

RadioShack is not completely doomed. It just needs focus and a reason for consumers to choose it. It needs a better understanding of the consumer. If its recent “the shack” campaign is telling of anything, it is that a change needs to be drastic and needs to happen urgently.

One of the greatest branding faux pas a company can make is failing to deliver on its brand promise.

Let’s take Best Buy, for instance. It is a company whose name alone suggests a brand that is your “best alternative” for electronics. This, however, is a branding promise that is hardly the truth and has led me to the assumption that Best Buy is hardly the “best” in anything that it does. That’s especially true when it comes to customer service, satisfaction and shopping experience.

Before I delve into my own Best Buy holiday shopping horror fiasco, let’s look at its recent online holiday shopping debacle.

As The Wall Street Journal reported a few days before Christmas, Best Buy was alerting customers that it couldn’t fill online orders. The crux of this situation was that droves of online customers turned to Best Buy to fulfill their shopping needs for Christmas. (Best Buy called the amount of online shopping “Overwhelming”).

The overwhelming response was a good sign for Best Buy. To stay relevant, it must combat the Amazons of the world as well as other prominent online retailers. Yet, Best Buy failed to deliver — and failed to do so during the most important retail time of year. Now, those hordes of hungery customers will most likely turn elsewhere next season. I surely would.

My personal experience didn’t go any better. Just a few days ago, my flat screen TV went kaput. I was really bummed out, of course, and quickly opted to hit Best Buy to get a slightly better replacement. In retrospect, I really should have gone to Costco as I would have saved time, and my shopping experience would have been much more positive, believe it or not.

Let me run down a list of what made Best Buy more like Miserable Buy.

1. It took 40 minutes to get any attention from an employee.
2. It took Best Buy four attempts to find me in the computer system. After the fourth attempt, I told them to “forget it.”
3. I had no idea which TVs were still available for purchase and which were not.
4. Having finally found a TV, I paid. I waited in my car at the loading dock for 20 minutes. Having lost patience, I returned to the employee who rang me up and asked where my TV was. To which the employee asked, “Have you paid?” I responded, “Yes! You rang me up!”

I wonder how can a company like Best Buy, with customer service as dreadful as this, truly look you in the eye and expect you to believe its promise of being the “best” of anything. I don’t believe it anymore? And, as its online and in-store shopping experiences continue to wallow, more customers just may purchase their products from a company who has the capability of fulfilling their brand promise.