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[WSJ] Best Buy Plays Web Hardball : Retailer Will Match Online Prices, Shrugs off 'Showrooming'

post #1 of 63
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Huge news. Pricematch Amazon?
Quote:
Best Buy Co.is planning to match the prices of Internet competitors such as Amazon.com Inc. this holiday season, even as it plays down its concerns over shoppers browsing gadgets in stores only to buy them for less online.

Best Buy said it wants to turn more shoppers into actual buyers.

The electronics chain also is preparing to offer free home delivery on merchandise that is out of stock in stores, according to a person familiar with the matter, in spite of recent remarks by new Chief Executive Hubert Joly that "showrooming" by consumers has been blown out of proportion.

The Richfield, Minn., retailer says it is taking these steps to improve the percentage of people who walk into their stores and leave with a purchase—about 40% of shoppers. "We have a tremendous opportunity to increase that close rate," said Matthew Furman, a spokesman for Best Buy.

Best Buy's seemingly contradictory stance underscores the conundrum facing executives at many big-box chains. Aware that they need to adapt aging business models to the realities of mobile- and computer-aided shopping, they don't want to overreact or lose sight of what made them successful—that is, selection and service.

In its own maneuver, Wal-Mart Stores Inc. WMT -0.54% is testing a same-day delivery service in select markets for customers who buy popular items online during the holidays. It is an attempt to leverage the strength of its massive store base, essentially turning the spaces into online order fulfillment centers for people who don't want to wait a couple of days for delivery.
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post #2 of 63
I'd actually care but Worst Buy and B&M lost me a long time ago. They've completely forgotten the concept of competition.
post #3 of 63
Price seems to be their major hurdle to competitiveness but I suppose time will tell if this is a case of "too little, too late."
Quote:
Originally Posted by MarvinDessica View Post

I'd actually care but Worst Buy and B&M lost me a long time ago. They've completely forgotten the concept of competition.

I can parse 'Worst Buy' but what do you mean by 'B&M'? Also if BB is offering to price match Amazon wouldn't it make sense to buy products in person rather than wait for shipping, ceteris paribus?
Edited by gelatin_factory - 10/12/12 at 1:48am
post #4 of 63
Three years ago I purchased a high-end 52" LCD HDTV for only $2037, free shipping and no sales tax! The best Best Buy could do was $2599.99 before tax, do the math as that's just disgusting! BB needs to start carrying components for system builders!
post #5 of 63
Quote:
Originally Posted by gelatin_factory View Post

Price seems to be their major hurdle to competitiveness but I suppose time will tell if this is a case of "too little, too late."
I can parse 'Worst Buy' but what do you mean by 'B&M'? Also if BB is offering to price match Amazon wouldn't it make sense to buy products in person rather than wait for shipping, ceteris paribus?

My guess is he meant brick and mortar or basically shopping in the physical world.

I have no doubt that a move like this would influence sales, but how could they sustain it? I'm sure Amazon keeps their costs as low as possible, and the costs associated with brick and mortar stores are just unavoidably higher.

Perhaps they're just looking for profitability right now, even if it's at a lesser amount that their competitors. The real questions are whether or not this is just a marketing ploy, with them actually losing money, or if this is actually a sustainable business model. When it comes down to it, Amazon should be able to beat any Best Buy price simply because of costs in the different models.
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post #6 of 63
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Quote:
Originally Posted by Kaldari View Post

My guess is he meant brick and mortar or basically shopping in the physical world.
I have no doubt that a move like this would influence sales, but how could they sustain it? I'm sure Amazon keeps their costs as low as possible, and the costs associated with brick and mortar stores are just unavoidably higher.
Perhaps they're just looking for profitability right now, even if it's at a lesser amount that their competitors. The real questions are whether or not this is just a marketing ploy, with them actually losing money, or if this is actually a sustainable business model. When it comes down to it, Amazon should be able to beat any Best Buy price simply because of costs in the different models.

They probably will have to push more of those "technical assistance" / "insurance" packages, this will cut into profits and they probably will lose money. In california it's enticing since Amazon now charges sales tax anyways. Now you have option to pick it up the day of.
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post #7 of 63
It's the first step in the right direction. I personally have had nothing but great prices and customer service for what I got at bestbuy. Think my best purchase from there was a $390 asus laptop

That had a a6 Llano quadcore processor, with 6520g graphics, and a dedicate 6650m, 4 gigs of ram, and a 500gig hardrive that I bought for a friend for cheap gaming on the go.
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post #8 of 63
I've never walked into a best buy where the guy knew more than what i3-7 is. These sales associates suck their managers know even less about the products and even the college hired geeks don't know about competition between services . It's not that they were hiding it I tested multiple stores in diff areas of 2 states I just think some better training would go a long way
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post #9 of 63
Quote:
Originally Posted by Kaldari View Post

My guess is he meant brick and mortar or basically shopping in the physical world.
I have no doubt that a move like this would influence sales, but how could they sustain it? I'm sure Amazon keeps their costs as low as possible, and the costs associated with brick and mortar stores are just unavoidably higher.
Perhaps they're just looking for profitability right now, even if it's at a lesser amount that their competitors. The real questions are whether or not this is just a marketing ploy, with them actually losing money, or if this is actually a sustainable business model. When it comes down to it, Amazon should be able to beat any Best Buy price simply because of costs in the different models.

They can charge a little bit higher that amazon and they would still sell, i mean, if the difference is not that much i would rather pay for a little bit higher and get the product right now than to wait for shipping. Plus you also save money because you don't have to pay for shipping. Another huge advantage is that i can easily return it if it's defective or for any reason.

Bestbuy doesn't have to pricematch amazon to sell, they just have to lower their ridiculous prices.
Edited by ghostrider85 - 10/12/12 at 4:56am
post #10 of 63
At the moment it seems they try any way to get out of a price match - including 'the price is too low to match'. I'm not sure what the point of a price match is if you can deny it based on it being below a certain dollar amount.

In other words, I'll believe it when I see it.
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