In the escalating competition for year-end shoppers, Best Buy says it will match rivals’ prices even after customers have purchased items, whether in stores or online.
Retailers are pulling out all the stops this year. Many, including Best Buy, are opening on Thanksgiving Day for the first time. They’re rolling out so-called “Black Friday” deals a week early and matching online prices. November and December is a key time for retailers, since the period can account for up to 40 percent of annual revenue.
But CEO Hubert Joly says the chain will match its competitors’ prices so that cost will not factor into where consumers decide to shop.
The company already warned on Tuesday that stiff price competition during the year-end shopping season will likely eat into its profit margin for the fourth quarter, calling price matching “table stakes” for competing during the season.
On Thursday, Best Buy said it was expanding its price-match guarantee to items that customers have already purchased. If a competitor, or Best Buy itself, offers a price that is cheaper than what a customer paid, the company will refund the difference, beginning immediately and until Dec 25.
“The game has changed, price is off the table,” said CEO Hubert Joly at the company’s Union Square store in New York on Thursday.
Joly said that the company’s product offerings, knowledgeable staff, and services like Geek Squad and ship-to-store should also help draw people into stores.
It joins Amazon, Wal-Mart and others in offering doorbuster deals a week early. Best Buy has faced tough competition from discount stores and online retailers for years. It is in the midst of a turnaround program under Joly that involves cutting costs, revamping stores and adding employee training to get customers into stores.
The Minneapolis-based company said Tuesday that it returned to a profit in the third quarter compared with a year-ago loss, while revenue was nearly unchanged at $9.36 billion.
Its shares closed up 36 cents at $39.07. The stock has more than tripled since the beginning of the year.