Best Buy to Put Human Search Engines to Work
Best Buy is looking to improve its customer service levels
so, today, when a person applies for a job with the consumer electronics chain,
the company is looking to find those who not only "get" technology, but people
too.
The chain is looking for these "people persons" because it sees service as
a key differentiator from the competition in the marketplace. While Walmart
and others may be able to compete on price, Best Buy management believes it
will be harder to match on service.
Today, Best Buy wants its associates to
find answers for customer questions even if that ultimately has them hunting
down a product sold somewhere else. The thinking is that the goodwill created
here will be repaid with loyalty beyond a single shopping trip.
"My vision is of the blue shirt as a human search engine," Robert
Stephens, Best Buy’s chief technology officer, told MarketWatch.
Mr.
Stephens recently went to a Best Buy store and asked an associate about a tripod
for an iPhone. The employee went online and found a $14 item on eBay.
"Best Buy didn’t make a dollar," Mr. Stephens said. "But
he did something that you can’t find anywhere else."
The emphasis
on service is part of Best Buy’s "connected world strategy," which
not only has it selling consumer electronics products, but a wide variety of
services such as mobile broadband, as well.
"The connected world strategy is focused on touching a larger profit
pool,"Â Barclays Capital analyst Michael Lasser told MarketWatch.
"Best Buy can compete effectively on price. Service and selection are their
competitive strengths."
Discussion Questions: Will Best Buy’s increased emphasis on helping shoppers
find the answers they are looking for be enough to gain share in the highly
competitive consumer electronics category? What will the chain need
to do to make sure the reality in stores matches the public statements made
by company executives?
This is a nice idea. Can’t argue with it. But how about going further and placing a lot of easily accessible PCs around the store so customers can do their own searches without having a “blue shirt” do it for them….
Mr. Stephens story about the iPod tripod reminded me of the 1947 movie “Miracle on 34th Street.” In that movie, the Macy’s Santa sent a customer to Gimbels for an item Macy’s doesn’t have and she becomes a loyal customer. Will it work for Best Buy? Not sure, but am sure that having people with a high service ethic as sales associates is a good idea.
Price is the easiest attribute to compete on (as long as you don’t mind perhaps not making any money). A service culture is very difficult to replicate. One caution–if you tell customers you have a service culture you have now set a higher standard that you will be held to.
Just in time for the holidays, Best Buy consults Miracle on 34th Street. Personalities are so important, I related everything about your business to them in my new book www.retaildoc.com/guide. Smart retailers will stop hiring people who are compliant but confident with customers.
If Best Buy is really serious about doing this, and not just putting on a show for the media, it will get a not-insignificant advantage among less tech-savvy consumers.
We have quietly observed continued declined in service at Best Buy since just before the demise of Circuit City. In fact, I would argue it is easier to avoid the crowds and just buy through Amazon that it is to find someone with a blue shirt who will actually TALK to you.
The company is wise to attempt to re-invigorate its customer service differentiation. It has talked the talk, now it’s time to walk the walk.
WOW! Best Buy is definitely on the right track and if they can pull it off, they will win big. Slugging it out with Walmart et al on price is a futile endeavor and very damaging to the brand in the long run. Service is personal, and personal service builds loyalty. I love the analogy of the associate as a human search engine! This is very good news.
As Peter says, how can you argue with the idea “we’re going to put our customers first, think that’ll work?” Obviously this is a good idea. The issue is, as always, in the execution. My suggestion is that BBY work on getting their current associates to actually interact with the customer, answer the phone, etc. Otherwise, this is a strategy that sounds good in the annual report, but produces nothing in terms of revenue or customer loyalty.
It’s a winning strategy provided it’s well executed. I like the “no commission” philosophy that allows associated to recommend the right–as opposed to the most expensive–option. This is just the next logical extension.
I was at a Best Buy meeting recently. The message on customer service is that the three words they don’t want to hear come out of a Blue Shirt’s mouth is “I don’t know.” The three words they want customers to hear is “I’ll find out.”
Also, Best Buy is not just about in-store service to sell goods. To them, the relationship begins when the sale is made which is why they have the 20,000 strong Geek Squad. This is not just a revenue enhancer for them. The last thing Best Buy needs is for the average consumer to become so frustrated with set up and operation of products that they get turned off to technology and don’t come back soon enough for those big ticket purchases.
If you look at the competitive landscape Best Buy competes in, you’ll find the following:
Price: dog eat dog world out there, so no competitive advantage.
Assortment: lots of choice everywhere (especially online), so no competitive advantage there.
Convenience: Easier to shop online 24/7, so no competitive advantage there.
Service: Few if any provide it well, so this is where there is room to shine and set themselves apart.
Love the notion presented by Best Buy. It’ll be interesting to watch and see how they pull this off. Wishing them well.
It’s a great idea…if they can execute. One problem with relying on associates’ knowledge to differentiate in this sector is that the competition is the internet. Or as my 7 year old says, “Google knows everything.”
Associates won’t know everything, so how can they find the information a customer needs quickly and accurately when the customer is standing there? Or really, how can Best Buy ensure the overwhelming majority of associates across 1000+ stores can find that information, each dozens of times per day? Not an easy problem!
If service is truly important then commission on sales does not send the right message. In addition to hiring people who have technology and people knowledge, Best Buy will need to invest in training. These employees will need to be knowledgeable about the technology being offered in the store which means periodic training on new items. These employees will also need customer service training as well as training in the art of asking questions. Accomplishing this goal as a differentiator is an expensive proposition but is not being done by other companies in this space.
Obviously this isn’t just an offensive strategy, but a defensive one as well.
Being an electronics retailer, they are surely realizing the increasing threat of shoppers wielding their smartphones as ready references to more in-depth product information (Consumer Reports App), personal reviews (Amazon), and *gasp* competitive price comparisons (Google Product Search). They need to deal with this issue head-on, realizing that it will only get worse. This mobile access phenomena is changing the landscape of shopping behavior at large.
I totally agree with the other posts in that its execution (and I’d add consistency) is critical. What they need to be careful of is being the resource shoppers go to gain awareness and education, only to go elsewhere to buy…most likely online. Then they may fall down the same path as past specialty electronics retailers, like Tweeter.
Great people can only deliver quality service if they are enabled by company practices and policies. Best Buy seems to be saying the right things about policies, but I’m unable to confirm that the practices are present to back them up.
Service practices span the gamut of in-store experiences: from offering the desired assortment; to having the desired items in stock; to store ambiance; to time-saving convenience; to availability of information about high-consideration purchases; to human beings who are capable, enabled and empowered to help.
Tech-forward shoppers would probably appreciate a free Best Buy smart-phone app they can use to enhance self-service while in the store. Shoppers who trail the bleeding-edge may require human assistance to succeed with certain purchase decisions.
Positioning its store associates as helpful “guides” may be a promising tactic for Best Buy. If it continues to pursue this it would do well to incorporate a simple loyalty metric as a check on its effectiveness. A single “likelihood to recommend” question captured at the POS might help keep reality in focus.
The “right” message is the one your customer wants to hear.
The question ultimately is, does the customer want the best price or the best service? The two rarely go hand in hand.
Way to go Best Buy! It’s about time someone picked up the knowledge slack since the demise of Circuit City. My hope is they mean it and have the capacity to pull it off. Finding the right people should not be as much of a problem as the training and retention.
I do not think price will be as big an obstacle once the knowledge and customer service piece is in place. Yes, there will be those who use Circuit City for the education and buy somewhere else; but the percentage will be minimal.
Come on Circuit City. Put the plan into action.