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NEWS

Dec. Game Sales Decline for Best Buy

Kris Graft's picture

By Kris Graft

January 9, 2009

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Best Buy said Friday that videogame sales suffered a decline during the fiscal month ending January 3, due in part to more cautious consumer spending.

Entertainment software, which includes games, DVDs and CDs, generated $1.9 billion during the month, a decline of 12.2 percent.

Total revenues were up 4 percent to $7.5 billion, driven by new store openings, but same store sales were down 6.5 percent.

Comparable store sales (in dollar terms) for videogames declined by the "mid single-digits," as consumers' interest shifted to software instead of pricier hardware. Best Buy also noted a tough comparison to last year.

"While the environment continues to be as challenging as we expected, consumers are being drawn to brands that they trust, and they are responding to our customer-centric model," said CEO Brad Anderson in a press statement.

The company also narrowed its earnings per share guidance for fiscal 2009 to the range of $2.50 to $2.70. Previously, guidance was for the range of $2.30 to $2.90.

Shares in Best Buy were down $1.59, or 5 percent, to $28.05 in early afternoon trading.

Rockemsock's picture
On January 12th Rockemsock said:

And my wife got swindled by their in-store duplicate Best Buy website. She had checked the price online, and then went into the store to buy the product. The product was priced higher than online, so she asked if she could have the internet price. The sales person said "Sure, let's check the website". He then popped onto their false in-store only duplicate Best Buy website that has all the same content, but with higher prices. My wife was disappointed and then purchased it for the higher price. When she got home she checked online and found out that she had been swindled. She went back to the store and returned the item...and then sent out an email describing the process to her entire email contact list.

During a recession (especially one like this one), Best Buy is going to feel the pinch. And business practices like those listed above are just going to make it all the more difficult for them to stay afloat.

I'd rather buy from Amazon any day of the week.

Kim_Naroz's picture
On January 12th Kim_Naroz said:

Best Buy is one of the most hated stores in North America because of their poor customer service. Tens-of-thousands of complaints are filed against Best Buy with the Better Business Burea every year. Even the Attorney Generals of multiple states have sought legal action against Best Buy for the poor ways that they do business.

Here are some comments I have observed from another website where Best Buy is being ripped on:
_________________________________________________

I was trying to gather some information to help people out when fighting legally against Best Buy. Here is something I found from the Better Business Burea from the Connecticut Attorney General. This information can be used by anyone, regardless of what state you live in. Currenly five states have legal action against Best Buy, but more states are investigating as we speak.

Here is what the Connecticut Attorney General has to say to people in a public announcement against Best Buy that seeks justice for American consumers:

Government Actions

In May of 2007 Connecticut Attorney General files a lawsuit against Best Buy alleging the chain used in-store computer kiosks to deceive consumers about product prices and overcharge them. The complaint alleges Best Buy used in store kiosks to conceal lower on-line prices and wouldn't adhere to their price match guarantee. Without admitting fault or wrongdoing, the company added banners to the kiosks indicating that the kiosks reflect local store pricing. For more information, you may contact the Connecticut Attorney General's office at www.ct.gov.
__________________________________________________

Best Buy is the worst place in the world to do business with.

Take a look at the Better Business Bureau. You really will see that there are over 40,000 complaints against Best Buy over the last four years, including over 12,000 this past year.

Attorney Generals from Florida, Ohio, Connecticut, Wisconsin, and Pennsylvania have all sought legal action against Best Buy for the following things:

* False Advertising

* Bait-n-Switch Advertising - In other words, Best Buy knows from the start that they don't have enough copies of the game to fulfill the orders, so they advertise a low-priced item, but their goal is to have you visit the website and buy something more expensive when you see that the advertised product is not in stock. This is one of the main reasons why the Attorney Generals have gone after Best Buy. They have been doing this in their stores for ages.

* Warranty & Insurance Fraud: If you buy Insurance from Best Buy and expect them to honor the insurance contract, you better think again. My friends and I know from experience that Best Buy will NOT honor insurance.

Here is an example:

I bought a $400 insurance contract on a 60" HDTV set. When the HDTV started having a green background imprint, Best Buy sent a technician to my home who said "The green background imprint is only in the lower corner and around the upper/left and top perimeters, so we can't give you a new TV for that problem."

I said "WHAT!!!" That's why I spent all that money on insurance!!!"

The Best Buy Geek Squad technician then said, "It's like that with Plasma's, too. We know from the start that the HDTV sets we sell are going to have pixels that burn out, and we aren't going to replace an HDTV set just because a few dozen pixels burn out."

The BIG problem for me was that my HDTV set wasn't a plasma, and about 25% of the thing had HUGE green spots!...Yet Best Buy would NOT honor their insurance contract!

...and just in case you are wondering how Best Buy handles videogames. I went to Best Buy store 415 in Fort Gratiot, Michigan and had the worst experience possible with the Customer Relations Manager (Brian Sawa) and the General Manager (Dave Bertram).

These two men literally laughed at a friend of mine when my friend threatened to call Corporate on them...They said, "We can do whatever we want, whenever we want, because Corporate will always believe anything we tell them." When my friend called 888 BEST BUY, the woman on the phone heard the two managers being immature and handling things inappropriately, so she filed a complaint with Best Buy Corporate against them. But when my friend called Best Buy corporate to see how the matter was being handled, he discovered that the two store managers told absolute lies (verified by multiple witnesses) to Best Buy, yet the corporate people refused to discipline those managers.

After all of my bad experiences with Best Buy, my friends and I decided to stay away from Best Buy forever. It's a much better idea to take Best Buy's advertisements and go to a competitor so that they can match the price, honor the warranties, and provide significantly better insurance.

frostquake's picture
On January 10th frostquake said:

Best Buy Needs An Over-Haul...well at least where I live.

I have several Best Buy stores by me, one that just opened within 2 years. This newly opened store looks horrible now. The store looks like a GIANT dump-bin at Wal-Mart. No one is keeping items straight, nor are they stocking new items the day they get them. I have spoke with many employee's including managers and they all could care less. The Circuit City's in my area are all closing, and I see Best Buy following if they don't change their in-store practices.

New Games are never out, and some weeks I go in 3 days after a game release and it is still in the Stock Room sealed. Employee's always go to the computer and look at my insistence. They used to simply tell me that if I didn't see it in the section they didn't have it. Now I take in stock numbers from their own website and make them look it up with me looking right at the screen with them, or they may lie and say they don't have it, even when inventory shows that they do. They simply don't want to go get the game for me.

With competition drying up around them, they are not as pressured to get sales and so have become lackadaisical in their customer service. Employee's have gone as far as to tell me product is buried some where in the back and it would be better for me to go to Gamestop, Target, or even Wal-Mart.

So I am not surprised that their overall game sales dropped. With a lack of customer service, product being out when it is released, and employee's sending customers to their competition due to them not wanting to actually go into the stock room and get the product, I foresee Best Buy heading the way of Circuit City. I do see Store Closures in the Future of Best Buy.

Digital-Hero's picture
On January 9th Digital-Hero said:

Strange, this wasn't the case for Gamestop which reported great sales. I consider Best Buy a better store too.