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David Poland

By David Poland

The Lessons Of Best Buy

Every now and again, I spend some time at Best Buy. And while the odds of me making purchases at the store have been reduced to almost nothing – “Ding Dong! It’s UPS with your Amazon purchase!” – I still find the marketing efforts of the Best Buy team to be quite illuminating about where we are in the retail universe as regards filmed entertainment. After about 90 minutes wandering around today, I found…

3D TV is not close to being a significant medium – There were four 3D TVs set up amongst the 150 or so HDTV sets on the floor. The primary offering was a 3D trailer for The Smurfs. The very clever “glasses on a pole” became less clever when you realized you were sticking your face where other faces had been with no idea whether the glasses had been cleaned recently. But more importantly, only 2 of the 4 sets had impressive 3D images. And then, when the offering was “what’s on ESPN 3D?,” the answer was “nothing.” Instead there was a blurry, but not really 3D on any of the sets episode of NCIS. Here’s the news, gang. No one is buying one of these things to watch the Smurfs movie. Show me how great the NFL – live or saved – looks and then I might started considering spending 50% more for 3D.

Prices on HDTV have dropped in a serious way – Most of them are now LCD and LED… and almost everything under 60″ is under $1000. Over 50″ seems to rise in price significantly, but still all under $3000.

The big thing is internet-ready TV – Almost every featured TV was sporting a scroll about the various kinds of internet access that was available on the TV, from Netflix to Crackle and on and on. The smallest TVs and the largest were touting this option. And every accessory that makes the connection without a special TV was also on display. This movement has all the signs of a success… it’s cool… it adds value… and you don’t seem to be paying more for it.

DVD is over – And not just regular DVD… Blu-ray already needs to be looking over its shoulder. Pricing is all over the place. There are Blu-rays cheaper than conventional DVDs because the studios are now pushing for Ultraviolet-included product. But all the prices are getting lower and lower. And the shelf space is getting smaller and smaller. Walking into the Beat Buy I was at, CDs are in front, Blu-ray behind and DVD peeking out all over. Louis CK did a concert and put it on the web and if you wanted a DVD, you could burn one if you wanted. The idea and its results have all kinds of implications, but the one relevant here is the DVD burning one. Studios are already anticipating the moment when you never put a disc in a player again… and can watch a film you have paid for on any of your TVs, you tablets, your pads, and whatever new devices show up in the future.

Best Buy is not too long for this world – The idea of a brick and mortar retailer competing with internet and FedEx/UPS is near over. Places where you can touch stuff will exist and thrive, eventually selling stuff at web pricing, probably having it delivered 2-day or overnight with a openly stated 10% uptick in price (or more) for retail-level stocking costs. Best Buy is selling more coffee machines, taking up more floor space with appliances, and doing a lot of space that is branded by the manufacturer. The company may well evolve into a showroom for stuff that’s sold online. There will be a good model for that someday (that will likely involve fewer “salespeople” who are a LOT better trained and paid). But what the company was… really close to over.

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17 Responses to “The Lessons Of Best Buy”

  1. sanj says:

    DP – your the guy who knows history – you didn’t mention circuit city and radioshack going out of business

    best buy still has a huge computer department – remember how dell was going to beat everybody by going direct to consumer ?

    all these huge retailers compete on price these days – best buy is up against sears and lots of other smaller
    retailers that have the same products like coffee makers..
    its all about price matching + the discount .

    all those 50 inch + tvs are nice but have you tried carrying one ? they charge extra for shipping.

    also when computer breaks down – people pay extra for geek squad to fix that ..

    plus they got all sorts of crazy deals on cell phones
    so people keep coming back to upgrade to the latest one and paying some more money

    hard to tell which products at best buy make the most profit for them..

    Sony sells tv business to Samsung .

    g4 tv has lots of tv reviews – most are 5 minutes..

    Sharp AQUOS Quattron LC-70LE735U 70″ 3D TV Review

  2. JS Partisan says:

    Yeah Dave, Best Buy still brought in 4 times as much as Amazon did over third quarter this year. True, they had to match Amazon prices, but 4 times as much as the biggest online retailer on earth is pretty fucking impressive.

    You also have to factor in that they are all over the world, under different names, but still they are a growing business. A business, that should be stated, not ran by total idiots like Borders or Circuit City. They will exist and evolve like they’ve been doing since 72.

    That aside, this really reads like a BUBBLE PIECE. I am glad you got out of your Ivory Condo long enough to visit a store most of the country uses to buy things, but it’s sort of weird for you to write this, as if you were visiting a foreign country. A place where you have to buy your entertainment buy be a foreign place to you. Huh. What’s the last movie/TV show/CD you bought? People go to Best Buy all the time. Acting as if they don’t because you don’t is the height of onanism.

    Oh yeah, UV? Really? How many of you folks use your digital copies? That is indeed that.

  3. Geoff says:

    Yeah, Dave – I think you’re really under-estimating Best Buy, here. Definitely company that has evolved with the times – I have to say their locations are always ideal, you never just see a stand-alone Best Buy without another “big box” store within a block of it. This was one of the killers for Borders – they started believing their own hype and starting popping up in isolated locations where the assumption was that people would go out of their way and seek out Borders.

    Also, the “Geek Squad” draw cannot be underestimated – most computers have become so proprietary that all of the mom-and-pop computer repair stores have withered and died – folks will go out of their way to a Best Buy to have a Geek Squad member look at their laptop when the screen gets distorted or when keys start not working, even though there’s often not much they can do about it.

    You know, despite the changing times, some retailers just survive no matter what – look at McDonald’s. Burger Kings are dying, Wendy’s are dying, Subway’s have become as prevalent with the push for healthier fast food, higher-end specialized fast food like Five Guys seem to be growing, HUGE push everywhere for more organic food…..and there is still McDonald’s thriving like never before. Now, I would never take my kids there on principle. But, do I still crave McNuggets periodically? You bet. Some brands never die. Best Buy is not going anywhere.

  4. Paul D/Stella says:

    Best Buy had to publicly state that they could not fill all of their online orders in time to have them shipped for Christmas. While that’s an embarrassment, isn’t it also a sign of their overall health right now? They seem to have embraced online shopping and be on top of adapting to the growth of shopping on the net.

    Adding to the Geek Squad comments, every time I’m in a Best Buy, maybe twice a month, the Geek Squad line is the longest one in the store.

    Also, I just bought a computer at Best Buy. They had great deals and I prefer to make that kind of purchase in person, at the store.

  5. arisp says:

    What the hell is Ultraviolet??

  6. sanj says:

    UltraViolet (UV) is a digital rights authentication and cloud-based licensing system that allows consumers of digital home entertainment content to stream and download purchased content to multiple platforms and devices

  7. Geoff says:

    Honestly, a lot of folks forget that it takes some degree of EFFORT to download movies or songs on to a disc. And it has never been as quick and easy as recording on videotape – that’s why UltraViolet is not any kind of real threat.

  8. berg says:

    bought the Panasonic Viera 42″ 3D at best buy, it was less than 100 more than the regular V 42″ …. only have one 3D blu ray, cave of forgotten dreams … still have to buy 3D blu ray and 3D glasses/goggles/welder’s mask

  9. mdoc says:

    Ultraviolet? Thanks but no thanks. The digital itunes copy with Blu Ray purchase is working perfectly. I understand that Ultraviolet is not compatible with my Ipad. Dont want it, don’t need it, it cant go away fast enough.
    Best Buy is here to stay. I buy a ton of stuff online but there is something to be said for the browsing experience.

  10. LYT says:

    “The idea of a brick and mortar retailer competing with internet and FedEx/UPS is near over.”

    This terrifies me, given how EVERY YEAR without fail I lose at least one package to the vicissitudes of both these barely competent companies. Unless you want to be 100% awake and alert and unable to leave the house between 8 a.m. and 10 p.m., it is inevitable.

  11. Ryan P says:

    When I was a kid, my relatives lived in a small town in Northeast Arkansas. The local Sears store there was a very small showroom that had several items on display for people to look at and touch and whatnot. But if you wanted to buy an item, you had to fill out a form and in a few days, whatever you ordered showed up at the store for you to pick-up (or, in the case of larger items, to be delivered).

    Everything old will be new again?

  12. J says:

    It can’t be good for their business, but I will still buy hardware at Best Buy if only for the ease of the return policy. When finally sussing out a blu ray player to buy, I found it hard to get past the string of dissatisfaction in the comments section of every online retailer… So over the course of three months I tried three different models, driving down the road to swap them at the end of the trial period. Finally settled on the one I liked best, went back to traded in for that, found I’d saved $60 off the original purchase price due to end-of-year sales. Shipping back-and-forth seems silly in that context.

  13. Edward says:

    I stopped shopping at Best Buy once word came out they donated to the same group in Minnesota as Target that openly supported and financed anti-gay candidates in 2010. Never again will I support either of these stores in any way, shape or form.

    I buy my books and videos from Barnes and Noble. I buy my video games and consoles from GameStop. I bought my TV and Blu-Ray from Sony Style. Thankfully, I haven’t needed to buy a stove or a fridge in many years, but I’m guessing Lowe’s will be where I go for those.

  14. Paul D/Stella says:

    Careful there Edward. Lowe’s has a long history of donating to Republican candidates. Isn’t it likely that some of those candidates are anti-gay?

  15. JS Partisan says:

    Yeah Lowes is still experiencing all sorts of heat with pulling their ads from All American Muslim. The fact that you go out of the way to confuse corporate Best Buy with a Best Buy store up the street, and then praise a shitty business like Game Stop. Who go out of their way to screw their customer no matter their race or sexuality, is god damn funny.

    I’d rather deal with Best Buy then shop at Lowes or Game Stop. I am glad you have a Sony Style but acting as if those stores are as prevalent as Best Buy in this country, is another good damn funny thing.

  16. palmtree says:

    Best Buy is now in that weird middle ground of having high prices and bad selection, but still being, well, there and somewhat accessible. Its music CD section is one of the few left (except for maybe Barnes and Noble). While that sounds horribly outdated, it didn’t feel outdated when I was looking for a last minute gift in the form of a kick ass CD box set to buy someone and instead found a disheveled mess with nothing but crumbs. But having said that, I still bought something…

  17. Don R. Lewis says:

    I agree with those above- I think best Buy will be around for awhile. I’m actually going there today to get a new car stereo installed and am kind of excited about browsing around. With “tech gadgets” it’s fun to try them hands on and Best Buy has a ton of crap. I mean, who in their right mind would buy a new, tricked out TV sight unseen from the internet?

    I also think you’re missing the point of a 3D TV. That point (to me anyways) has always been based on video games. I don’t think movies and sports will be the selling points but folks will start making 3D video games that change everything.

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