Circuit City closing all stores -- watch for bargains coming soon (1 Viewer)

[Aaron Silverman]

My CC was PACKED yesterday. No exciting deals (30% off furniture would've been nice if they'd had much of it left). I may stop by again towards the end -- we got some nice deals in the final days of Linens & Things.

It got me wondering whether they could have survived on a business model of pricing everything 5% below retail: "5% off all the time!" If they'd been half as crowded on a regular basis as they were yesterday, they'd probably still be in business.

And while everyone's complaining about the low-paid sales staff, I'll take a Circuit City salesperson who admits not knowing much to a Best Buy salesperson who spits out-and-out LIES in my face. Those have been the norms at my local stores for a long time.

 

[Peter McM]

I'm sorry to see CC go. I purchased a 32" Magnavox CRT from them, and was very pleased. I bought a 19" TV from Best Buy, and it was a customer service nightmare; the picture tube went out a month after I bought it, and the repair turnaround was about eight weeks. Then it went out again a few weeks later. I had to twist their arm to get them to replace the bloody thing. Since then, never again a major electronic from BB.

 

[SeanC]

I went to Best Buy today, and when I checked out, asked about price matching Circuit City, and was given a very blunt "We don't price match Circuit City anymore." So, so much for that! I really hope that Best Buy doesn't think they don't have to try anymore since they're the only one left...they've started to disappoint me since last year.

 

[David Deeb]

I don't know that you can blame Best Buy. I mean Circuit City is going out of business. Who knows what CC will be doing to pricing over the next few weeks.

What I don't understand is this "game" to beat up retailers over pricing at other stores. I mean, I'm all about keeping retailers honest too, but if you like a price at one store, then go get it from the store that advertised it.

Why get mad at the 2nd store? Go get it from the one who had the price you liked best.

 

[TravisR]

Plus, the store in my area wasn't even honoring the ad because they were going out of business.

 

[David Norman]

Losing CC doesn't make Best Buy a monopoly. There are still plenty of Electronics dealers around though certainly one less National big box. Obviously depending on your location the choices are just different -- Target, Costco, Sams, Walmart, HH Gregg, Fry's, Meijer, Sears for price matches.

And the online choices aren't doing anything but gaining power -- Amazon, OneCall, Frys.com NewEgg, etc. At some point Best Buy and the rest are going to have to do something to counter the Internet Sales drain or more CC's will follow.

 

[Todd Stout]

Circuit City was the closest thing to a Best Buy however. I do have access to Costco, Target, and Wal Mart but none of those are all that similar. Sure, they all sell TVs, DVD players, and the like but they don't have the same selection that Circuit City and Best Buy offer. I can also shop at Fry's... if I want to drive 35-40 miles (I really wish they'd open a store nearby).

 

[David Norman]

Closest Fry;s to me unfortunately is 4 hours, but then again CC and BB are/were 30 minutes so maybe a different perspective as to nearby. Your Frys is still a player as far as a price matching chip so BB still has to honor at least the going rate and BB can't eliminate price as a factor just because of CC no longer being viable. It certainly makes it a bit harder work, but BB us bit free to do as they please or they will follow down the CC path themselves.

Locally, HHGregg is the current closest direct competitor to my BB and they concentrate mainly on the TV/Audio side with very little software. Of course, almost all software (DVD/BR, etc) I get online these days so that's not much of a loss. I virtually never buy movies directly from the Big Box stores anymore except for a few of their loss leader type. With Amazon Prime I almost always get the movies on the release date with no tax/shipping and almost always cheaper than anything BB offers.

 

[sestamuch]

Yep... the future doesn't look bright.

 

[Brian^K]

What can they possibly do? Best Buy's answer is to "join 'em". BestBuy.com is probably a major source of revenue for the company, and perhaps even a major source of sales for the stores, themselves. However, if we consumers want Best Buy there, with the vast array of electronics floor models set out for us to look at, touch, etc., then what advantage can Best Buy count on to justify keeping their b&m stores open, when they could just as well make the sale on BestBuy.com and save all the overhead of the store? There needs to be more money to be made via the b&m channel to substantiate the higher costs. Where is that additional money?

We consumers have fostered the marketplace we're going to have to operate in, for good or ill.

 

[Aaron Silverman]

I think you're making an invalid assumption that a price matching policy will result in every customer researching the lowest possible price. I'd bet that only a small percentage of customers actually go to that trouble.

If you price a product higher but will match a competitor's price, then you'll likely end up selling the product at both price points. It's sorta like hedging your bets.

 

[Brian^K]

Go back to what David Deeb said on this thread:In that context, please explain your point about what you think was invalid about my assumption. Customers who don't research the lowest price won't necessarily buy from you, nor will those who do. So again, what value is it to the retailer to offer price matching, given that it undercuts the retailers own ability to set their own pricing strategy?

 

[Patrick Sun]

Some people price-match at Best Buy because they want to rack up Reward Zone points with the purchase.

Wal-Mart is pretty aggressive with Black Friday price-matching, just bring in any other store's Black Friday ad, and they'll match it. They just want to get people accustomed to one-stop shopping at Wal-Mart.

 

[Ron Bartyczak]

I, too, am disappointed that Circuit City is going out of business. I used to have Best Buy, Circuit City and Tweeter within 15 minutes of home. Of the three, I probably liked CC the least. However, I did like the local choices which I have now lost. I purchased more at Tweeter than all other outlets. They went from 2006 Retailer of the year to out of business at end of 2008!

I do have a high-end AV store (Gramophone) within 5 minutes from my house, but I have purchased very little from them. I also have a Myer-Emco within a 1/2-hour drive. I suppose I'm better situated than many regarding B&M stores.

 

[Jeff Swindoll]

Circuit City, the day the music died..

 

[Grant H]

Anyone know if they'll still take rewards certificates? I know they get rung up like gift cards, and they're supposed to still take them.

 

[Jerome Grate]

My guess, (and just a guess) if CC folded, then Best Buy isn't far behind. Just another sign of the economy. Gee, if I had to choose between a 1,300 Samsung or a bill that I can catch up with, then I choose the bill.

 

[Brian^K]

Well, if anything, Circuit City's closing gives Best Buy a lift. They may still go under, for the reasons you allude to, but if they were hurting that badly, then surely they'd go under quicker if they had more competition.

 

[Aaron Silverman]

What does that have to do with the context? His suggestion only applies if there is no other reason to choose one store over the other. If store A is, for example, on a consumer's way home from work and store B isn't, or if the person has another reason to visit A (for another item, say), then A's price-matching policy will encourage that person to buy a cheaper-at-B item from them instead of going out of his way to visit B.

As for pricing strategy, like I said, only a portion of consumers will actually go to the effort of price-matching. It's a way for the store to sell an item at more than one price. Selling something for $20 and matching a competitor's $15 price for a few customers is not the same thing as selling it to everyone for $15. The advantage is the ability to charge $20 to customers who don't ask for the price match -- it's competing on price for the customers who care about price and competing in other ways for the others.

You appeared to be assuming that if a store matches prices, then all customers will always ask them to match. If I misinterpreted then I apologize.

 

[RickER]

I dont think BB will go under. They may be hurting, like every store is, but they are clean, bright, well maintained, have staff, and they are more likely to help. I didnt get any of those things in the last 3 or 4 years i walked into a CC. But i did get a big sigh anytime i asked anyone where i might find something! And never found what i was looking for!

I would pay off my bill too Jerome. Then i would buy a $4000 Sony LCD with 3 years no interest. I would also pay it off, on time, and not owe a dime of interest! Oh, wait, i did do that.