Best Buy's New CEO: Now for the Hard Part

(Additional information on Best Buy Mobile included.)

It's a heartwarming tale. Local boy makes good. "The Secret of My Success" meets "Clerks."

But when Brian Dunn -- who started 25 years ago as a sales clerk in a small regional electronics store turned electronic giant -- took the reins as the new CEO of Best Buy(BBY) today, the Hollywood script immediately turned from feel-good hit to drama.

As Dunn, 49, succeeds retiring CEO Brad Anderson, he is inheriting a company that can be best be called "challenged" -- one vying for a legion of consumers who are diligently cutting back on big-ticket electronic purchases.

Despite the shuttering of rival Circuit City, Best Buy isn't gaining as much market share as investors would like. Amazon.com(AMZN), Wal-Mart Stores (WMT) and Costco Wholesale(COST) are all vying for Circuit City's customers and doing a good job competing on price.

And while Best Buy is picking up share gains in categories where it has a competitive edge, like car stereos and home theater, gains are less profound in generic categories like DVDs, which can be purchased in a variety of locations.

Indeed, since the elimination of Circuit City, Best Buy hasn't seen much momentum in sales. In fact the first quarter marked the third consecutive quarter in which same-store sales declined, falling 6.2%.

But Dunn has a plan. One of his biggest goals is to bolster market share in local communities. He plans to do this by stocking stores with an assortment of products, hiring smart employees and increasing its stance as the go-to destination for digital solutions and "connectivity."