I read this exchange between Doug Meacham and Barry Judge via ChrisBrogan.com. Chris is right; as a brand you are always on. But customers are using that to their short-term advantage sucking out the value of your brand by demanding the lowest price possible. It won’t be to their long-term best interest. But, we live in a now-now-now world and they don’t care.
Except that they should. There is the next generation involved and they are watching. And they will be running the world with the lessons we are showing them. And the lessons are flawed.
Meacham had an opportunity to teach his daughter how value works and how to win with grace, but failed miserably at both. Instead, he taught his daughter that asserting your point of view forcefully on people using your own me-centric logic will get you what you want. The parallels to Paper Moon are just too easy.
And then, after you get what you want, you do a victory dance over the dead body of your opponent by sending out a snarky tweet.
Had the cashier fully understood the value proposition and fully understood Best Buy’s costs in providing the camera at retail, the $50 in-store, get it now “convenience price” would been more than reasonable. The cashier should have invited Meachum to order the camera on the Web site where it would be available for pick up at the store 45 minutes or so later.
To quote CK Lewis, “we live in an amazing, amazing world and it’s wasted on the crappiest generation of spoiled idiots that don’t care.” It is now beginning to leak over into the next generation. The overhead costs of heating, lighting, payroll, inventory, cleaning, returns, display, POP, etc, etc, that the modern retailer is faced with in providing their customers the opportunity to touch the product and buy it within minutes should have value. That value should be the competitive advantage Best Buy has over Amazon who forces you to purchase products and then wait for them to come in the mail. (Only after having gone to Best Buy to touch and feel the display? Hmmmm… I think Best Buy should charge a “touch and feel” fee.)
I think the tweet from @BestBuyCMO asking “What surprises you?” was a genuine inquiry after Meacham asserted his knowledge and experience with mass retail, having worked for Circuit City 23 years and is now with IBM Retail. If he did have experience, his tweets didn’t establish a deep understanding of value or pricing strategy. What he exhibited was his own selfish quest to get the lowest price on his terms and then rationalizing it using the flawed logic.
Perhaps Meacham could have gone to the Amazon store down the block instead for a lower price?
Sure, there are perception problems with Best Buy’s pricing and they have some work to do. Personally, I think there are some details about the purchase exchange that Meacham is not disclosing. I frequently purchase items from best Buy through the Web site for pickup in the store just for the confirmation that it is in stock when I get there. Since you have to have a credit card to buy online and a driver’s license to get there, these two “conditions” are not an issue. It is a bit puzzling that they would be for Meacham. (I know a 15-year-old does not have a credit card or license for id, but you need that to purchase online at BestBuy.com. How was the camera to be paid for?)
I don’t think this was really Barry Judge tweeting out these comments, but even if it was, you can’t fault him for chiding Meacham for his stupid, me-centric tweet. It should have just been ignored and been counted among the endless stream of Meachams who have come before and will come after, like a million ants at a picnic whose existence is defined by how much they can scavenge from the labor of others all the while annoying the picnickers.
But Meacham asserted industry wisdom that he probably doesn’t have or he would have understood the pricing models and why they exist, even though they don’t make “common sense” to the average consumer. And, he would have used his 23 years of experience to explain them to his daughter. Instead, he chose to contribute to the sheep-like march of consumer demand for low price and free, a model that is just not sustainable in this or any economy.
In five or ten years, Meacham’s daughter will be applying the same pricing logic with her employer that the cashier did at Best Buy, costing her employer even more money. After all, she saw it worked first-hand from her dad. What other model would she know?
PS Don’t chide me for “bringing the kids into this argument.” Meacham did that on his own.