Apple, Best Buy, and the Need to Adjust to Consumer Buying Habits

 In Innovation, Market Vision, Musings, Trends

Consumer buying habits are constantly changing. They don’t buy the way they did ten years ago, five years ago, last year, or even last week. Successful companies today are the ones that know how to build a personal relationship with the customer, not only to understand consumers’ wants and needs, but also to instill them with a greater sense of brand loyalty.

ConsumerSatisfaction

Are you a satisfied customer? No? Me neither.

A few weeks ago I had the misfortune of entering an Apple store in order to buy a new wall charger for my Macbook. I’ve always loved my Apple products, their simplicity, and their delightfully minimalistic design, so I figured I ought to speak to one of the self-proclaimed “geniuses” behind the service bar. While I’ve always found them to be proficient and helpful, this particular visit left me overwhelmingly disappointed.

After explaining my charger’s problems and asking the service technician to replace it, he spent an unnecessary 15 extra minutes re-diagnosing the issue I’d just described. He, at long last, told me what I already knew: I needed a new charger. Because I’m a bit of an impatient customer and because I wanted him to fulfill my AppleCare warranty on my now-defunct charger, I bargained about the price.

The final verdict? I had to pay an outrageous $80 for a replacement. Eighty dollars!? My laptop was six years old! Eighty dollars was practically as much as that ancient, outdated hunk of junk was worth! I tried debating the issue further and the man refused to budge. I was so upset that I pulled up Amazon.com on the store’s free wifi and showed him that I could buy a charger there for $40. Instead of matching the price and giving me the charger right there in the store, he watched as I ordered the product online, slammed my computer closed, and stormed out of the building without a second glance.

I will never go back to an Apple store. I’m too infuriated. But why can Apple jerk around their customers like that?

1) Because they know how to tell a good STORY.

Remember the original iPod ads? Of course you do. The black silhouettes rocking out and dancing over colorful backgrounds. The iPod headphones swinging across the screen. They’re classic. Apple figured out that their customers wanted something flashy. They wanted something new and intriguing. Their customers didn’t want just another ad with talking heads. So Apple intertwined the story of their product — a hip new music-playing device — with the story of a hip, new type of TV ad. In essence, they understood how to relate their product to their target audience.

2) Because they know the current customer environment.

Apple knows that they have a dominant hold on the laptop, phone, and tablet market. Their products are tightly integrated and they know that people prefer the simplicity of OS X to the abysmal Windows 8. Therefore their branding (and especially their brand loyalty) will keep customers from shopping elsewhere, be it at Best Buy or Lenovo or wherever. In my case, Apple knew they would take my money no matter what, be it the forty bucks online or the eighty bucks in the store. They knew they had me on the hook and so I had to pay the metaphorical and literal price.

3) Because they have great products.

Let’s be honest: People love Apple products because they work. They’re simple and fluid. Everything surface feels smooth and every scrolling movement has a soft bounce when it reaches the top or bottom. When I made the switch to an Android phone, I struggled with the apps and the buttons and the whole darn thing. I just wanted a single button, just like on my iPhone. While I have come to enjoy my Android device, the fact of the matter remains: Apple provides users a fantastically fun and exciting digital experience for the average user.

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A company like Best Buy, on the other hand, does not have such leeway. Because they’re essentially a middleman between the consumer and vendors like Apple or Lenovo or Samsung, they are forced to differentiate themselves from both their vendors’ own stores and their competitors’ stores in order to attract customers. In recent weeks, Best Buy has instated a new policy to generate increased customer traffic by matching competitors’ prices. They’re willing to sacrifice larger profits per product sold in order to develop any small amount of revenue whatsoever.

The problem is that price matching isn’t enough to keep them in business. Unlike Apple, they don’t have the brand or customer loyalty to return to their stores over and over.

So what can a company like Best Buy do to generate more customers, conversions, and revenue? ADJUST to changes in consumer buying habits! 

Here’s how:

1) Engaging more heavily in social media and digital marketing campaigns.

More than ever, consumers are finding and buying products based on QR codes and Facebook recommendations. By some estimates, consumers are 71% more likely to buy a product based on a friend’s Facebook recommendation. Other estimates say that 53% of shoppers who viewed a friend’s recommendation and then clicked through to a retailer’s website have made a purchase. If Best Buy can engage consumers through social media, they can drive traffic away from retailers like Amazon and push them towards their own stores and websites instead.

2) LISTEN to what their customers are telling them.

Let’s take a look at the phrase “best buy sucks” when we type it into Google.

bestbuysuckssearch

That’s a lot of angry customers.

The results show that there are 5,700 pages with the phrase “best buy sucks” in the page title. This means that close to 6,000 people were so pissed off at Best Buy that they felt the need to vent online about their experience. Keep in mind that this is just one key phrase.

Is Best Buy listening to their customers concerns? Maybe. But if they are, then they’re doing an awful job of letting the customers know. If I were Best Buy CEO Hubert Joly, and I read this article, the first thing that would come to my mind is, “How the hell am I supposed to listen and respond to every negative conversation about Best Buy on the Internet? Surely that’s preposterous?” (Hopefully Mr. Joly has the same love for antiquated, 12-letter words as I do.)

The answer is you don’t. Here’s a suggestion: Take a look at Starbucks and what they’ve done to adapt to customers buying habits.

Three years ago, the My Starbucks Idea website was created to actively engage customers and crowdsource their expertise and suggestions. Instead of accepting (and ignoring) negative customer complaints like Best Buy, the My Starbucks site encourages positive customer commentary and asks them to submit ideas on better products, improving the customer experience, and creating new community involvement.

It’s about time Best Buy gives their customers a voice and platform for discussion. Not only that, but it’s about time for Best Buy to listen too.

3) Consultative selling: Providing and guiding clients with better INFORMATION.

The process of buying a product at Best Buy is a hassle to say the least. As bad as I found the service at the Apple store to be, at least they always have 15 or 20 people standing around waiting to help you. In my experience at Best Buy, however, there are usually only a handful of people in the whole building. Even then, most of them are centered around the high-selling products like cameras and TVs. Most of us don’t go there to buy a product we already have decided on. It’s much easier to just order it online. People go to stores to gather more information about a product in order to make a decision on whether or not to buy a product. Best Buy, therefore, needs to use its employees more effectively. Instead of finding customers with big wads of cash and trying to up-sell them on an unnecessarily expensive product, their employees should be matching a product to each customer’s need (and their wallet). Best Buy should focus on its customers’ needs by garnering more information and reviews about its products, and thereby generate more positive reviews rather than having a customer post online about how they didn’t need the newest 3D, 1080p TV with surround sound that they still can’t figure out how to hook up.

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What do you think? Please repost this article and help foster a larger discussion. Also feel free to comment below, email me at brendan.szulik@plazabridgegroup.com, or connect with me on LinkedIn.

-Brendan Szulik

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