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.

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.