BEST BUY: “Amazon’s Showroom?” Not so Fast.
* Best Buy is the next Radio Shack (not good—Radio Shack is a $4 stock, down 75 percent since last July’s $16 price).
* Best Buy’s business model is a dinosaur, a relic of a by-gone era.
* Best Buy is Amazon’s showroom (meaning people check out the merchandise at Best Buy before going home to buy it at Amazon and other e-tailers).
The last claim is particularly annoying, because it has been uttered by such luminaries as CNBC’s Jim Cramer and other financial “geniuses” countless times in the electronic and print media. But what these pundits neglect to tell us is that Best Buy price matches on all new, boxed items (in some markets). But I am getting ahead of myself.
Call me old fashioned, hell, call me a dinosaur but I happen to think that Best Buy’s prospects are quite bright. And it isn’t because they are trying to be the next Apple store, which many of those same pundits have asserted in recent days on those same financial channels. Then why am I so bullish on Best Buy? Much of this has to do with my personal experiences at my local Best Buy (located in a Chicago suburb called Downer’s Grove, Illinois). First some history about me and my personal buying preferences.
I do indeed like to touch and play with gadgets and electronics before I buy them. But once I do, I have the patience of an ant. Once I have decided that I want, say, a particular laptop computer or TV, I have to have it, and I have to have it right then and there. Not tomorrow, not in a week, not in ten days. Nothing thrills me more than walking out of that store with that computer under my arm as I show the over-sized bouncer at the door my store receipt. And if you think I am impatient, you have never met my twin boys. But I am getting ahead of myself again. Bear with me as I tell you this week’s computer war story.
Two days ago I went to that Best Buy in search of a new PC. Mine was home dying like some ill-fated, cancer-ridden patient on life support. It is worth noting I am a great Best Buy customer. I had purchased several computers over the last six years—each with multi-year “Black Tie” protection warranty plans (that’s the plan that covers everything unless you do something really stupid like throw your computer off a building). I know that store well, so upon entering, I headed right for the computer section. One of the first items that caught my eye was a “clearance” priced Toshiba with a good sized screen, nice touch-pad, and all the bells and whistles including Windows 7. The price? $329! I couldn’t believe it. The last Toshiba I bought there cost me more than $1,000 and this one seemed even nicer. Long story short, I bought it on the spot with a two-year Black Tie warranty, along with Windows software. I took it home and to my delight instantly fell in love with it. That’s when my wife and I decided that I would go back to the store the next day and buy not one—but two more of those Toshibas for my almost eight-year old twin boys (it would be their first computer). They had been begging for their own computers for many months and the time—and price—seemed right.
When I returned that next day, a salesman named Jim came right over to help me. Jim was great—helpful, incredibly respectful and upbeat. As was their customer service rep, Elliot. Still, I decided to ask for a manager to see if he or she would cut me a price break on the computers or accessories I was buying. After all, I had bought my wife a pricey Mac back in June, and now I was buying three more computers within 24 hours. I figured that makes me a “platinum” customer, and I had hoped that Best Buy management would see it the same way. That’s when not one, but two managers came over to help (I felt platinum!). The first manager took immediate control of the situation. Her name was Krystle H., and she made me feel like a million bucks. How did she do that? By immediately recognizing my value as a frequent customer and by discounting all three Toshibas, even the one I bought the day before. I had never received a retroactive price adjustment by a retailer and it felt great. Then she did the same thing on the Skull Candy headphones I was buying, as well as a few more accessories. Another manager named Andrew L. got into the act and also helped (he also engaged me in conversation about the Best Buy/online retailer debate). The only thing I paid full “retail” for was the Black Tie protection programs, as those prices are etched in stone. Still, I got a terrific price break on just about everything else and never felt better about a major purchase in my life. I was delighted to show the bouncer my store receipt on the way out!
Now, all of that begs this question: have you ever negotiated with a Website? (eBay does not count). Obviously not, but that doesn’t mean the Amazons of the world are not great places to shop. It’s just that its not for me. Besides, when things go south with the computer you buy online, where do you bring it to get it fixed? But those are just details. Why will I always choose a Best Buy over an online retailer? The answer is Jim and Krystle and Andrew and Elliot. I love people and I love to do business with people. I may buy my books online but I will never buy larger-ticket items online. I simply have way too much fun negotiating for lower prices…something that online shops know little about.