January 07, 2010
By the ZippyCart Shopping Carts Content Team
Best Buy, named for its ability to provide the best possible prices in electronic retail, has steadily moved away from its promise filled name as online ecommerce continues to charge lower prices at a better value to customers. While this trend was a slow one for some time, it rapidly increased as competitive brick and mortar stores like Circuit City left the playing field. Now, Best Buy rests as one of the few offline electronics stores standing, with not much more than a brand name to keep it afloat. For consumers, the implications of the name are starting to wear thin as they realize that Best Buy prices are no longer the best deal around.
This shift in consumer spending stems from a down economy and an ecommerce world at their fingertips. Online storefronts provide deal hunters an opportunity to search for the true “best buy” from the comfort of their own home. Trends like this drove the store to create its own online shopping experience at BestBuy.com, which has helped the company hit projected revenue goals (even if they scale them back from time to time). Some examples of huge price discrepancies can be found through simple comparison shopping as shown below:
Product: The Wire Season 1, 2, 3, 4, or 5
Best Buy Price: $54.99
iTunes Price: $19.99
Amazon Price: $37.99 – $54.99
Product: EA Sports Active for Wii
BestBuy.com: $39.99
Target.com: $19.99
Product: Samsung 50in Class 180p 600Hz Plasma HDTV
Best Buy: $1399.99
Store.Advantage123.com: $985.90
Despite these large discrepancies in price, the company still manages to allude customers as a great deal. This points to one of the benefits of branding and marketing that large name companies can use to pull ahead in the online space. Ecommerce store owners should take two lessons from Best Buy. First, online store owners should take advantage of the fact that Best Buy continues to raise prices while relying on its name as its only claim to having the best deals. Online consumers like to comparison shop, and many will visit an online store that shows the lowest prices. Merchants should make sure they are using ecommerce shopping cart software that integrates their shopping feeds with sites like Google Products, BizRate, and PriceGrabber. Here, online merchants can go head to head with sites like BestBuy.com and show the large price difference.
Next, the brand war is one that is hard to fight, so once a customer is engaged by a lower price, it’s important to keep their attention with a trustworthy website. The final product shown above is a good example of this. While the TV costs almost $500 more at BestBuy.com than it does at Store.Advantage123.com, some consumers will choose to spend the extra $500 because Best Buy is a name that they trust. Still, curiosity will almost always prevail, so most consumers will click on the low price first to see what the website looks like. Store.Advantage123.com is a fantastic example of gaining a user’s trust. The site is professional, focused, and easy to navigate through. The look and feel of the site, combined with the lower price, should be just enough to win that customer.
As the ecommerce space evolves, consumers will continue to search out the best deals possible and become even more confident shopping online. Big name chains like Best Buy will have to adapt to the changing marketplace, or lose sales to better priced and higher value online storefronts. Merchants have the opportunity to gain at Best Buy’s loss provided they utilize the right tools to be found by deal hunters and gain consumer trust.
Related Articles for Branding & Customer Loyalty:
3 Ways to Improve Usability on Your Ecommerce Site
3 Tips to Improve the Online Shopping Cart Experience
Even More Tips to Improve the Online Shopping Cart Experience
Scott is an avid fan of all things ecommerce. His claim to fame is that he "puts the Zip in ZippyCart." He considers himself the world-wide number one reader of TechCrunch, C|Net, and The Ecommerce Times. Scott has worked in the SEO industry for many years, but found himself always shifting his focus to review sites and ecommerce blogs. When we decided to start the ZippyCart Ecommerce news, Scott was an obvious fit. He handles most of our OpEds as he is a very opinionated guy. Scott is also our Twitter guy, so don't hesitate to send him a tweet if you see him online.
