[nordsieck]

>> The physical store should be for letting people try and touch items, before they buy them from your website.

> That doesn’t work if you are Best Buy.

Apparently it does work if you're Best Buy.

> we price match products shipped from and sold by these major online retailers: Amazon.com ...

https://www.bestbuy.com/site/help-topics/best-buy-price-matc...

[travmatt]

If I’m understanding your comment correctly, you believe the fact that Best Buy has been forced to price match as a way to stop losing business is evidence that they’re not losing business?

[zeta0134]

Nah, it's that Best Buy doesn't make most of its money on the items they price match. Their big sellers are their mobile department and all the accessories folks like to pick up with their new purchase, which are very often store exclusives and have incredibly high margins. They make a killing on chargers, adapters, phone cases, you name it, but actually make tiny margins on a lot of their "core" items. The big ticket item they price match is often kicked back by the vendor anyway, so the store doesn't lose out when they do it. Their goal is just to get folks in the door, and let the momentum of a good sales interaction close the deal. (Questionable on the "good," they're admittedly not very good at screening / training, but in aggregate this strategy works well for them.)

Best Buy price matches because it gets people in the store. I don't believe for a second that they did it in response to losing business to online storefronts; rather, I think it's far more likely that they did it in response to other retail chains doing the same. Their customers came to expect it, so they obliged, as a marketing tactic to make sure their retail competition didn't have that as an edge. Their price match policy is also pretty strict; they won't match just anything on Amazon, it has to have some degree of verification and be from a trusted seller. (Especially for things like iPads / common fake listings, etc.) Last time I checked it had to be "Sold and shipped by Amazon" but that might have changed, it's been a while.

(Source: I worked at a Best Buy store for about 4 years.)

[Theodores]

If you are a brand and sell through Best Buy then you have to pay to be there.

There are many ways of paying:

Products have to be supplied in a fairly 'just in time' way so you are doing the warehousing/distribution that retail chains used to fully take care of.

You have to take back unsold inventory or take back inventory if it under-performs and the range/model/SKU is dropped. So this also means that for the customer there is no 'old model deeply discounted' unless it is a store demo unit.

You have to pay for marketing. For Best Buy to promote your brand you need to pay for that.

You have to pay for what shelf your products are on. This is a bit like concessions in department stores or end of aisle shelves in a supermarket. You only get your products at eye level and prominent if you pay.

You might have to pay for Best Buy specific models. This can involve cosmetic changes to the product that mean more production costs (e.g. moulds for injection moulding, packaging).

You might have to have a team of people do in store training, visiting Best Buy stores and teaching the staff how to demo your products. This is actually really crucial.

Best Buy do provide sales data that helps forecasting demand, this is useful but in the olden days the store would take all the risk of ordering what they thought they could sell.

Despite all of the above Best Buy are great to work with for most brands. However, not all chains are. There are plenty of stories of companies that have worked with Walmart to come apart. This happens as the margin Walmart demands means that one has to nickel and dime the product to make it as cheap as possible. People buy into the brand, take it home and find it is rubbish. They take it back, don't buy the brand ever again and cost you money. Meanwhile the specialist retail channels that the brand did have stop selling the product as Walmart have started selling it for less than what they can sell it for. In this way a brand can quickly die. The trap is that if you don't sell your product at the price they want to sell it at (as a 'loss leader') then they can boot you out of the store and get your rival in instead. It is lose or lose for the brand when the retailer does this.

[bsder]

Best Buy specifically has their house brand of many common things (chargers, cables, etc.) and refuse to price match those.

[scarface74]

And for some products like TVs, I’m sure they have thier own custom model number for third party brands.