Will Best Buy's Horrible Customer Service Sink Samsung?

Is it just me, or is going into a Best Buy (NYSE: BBY  ) a little like getting poked in the eye? "In addition to price, we believe our ability to deliver a high quality customer experience offers us a key competitive advantage," claims its most recent annual report (emphasis mine). Really? Does that include ignoring customers and heaping thinly veiled disdain on those you do interact with?

Perhaps I'm being too harsh here.

I admittedly don't frequent electronics stores in general, or Best Buy in particular. Like a growing number of consumers, I buy my electronics either online or at Costco. Beyond price, I really do find visits to Best Buy increasingly dreadful. While it may claim to "deliver a high quality customer experience," I prefer a complete absence of customer service (a la Amazon.com) over what's offered at Best Buy.

It's for this reason that I find Samsung's decision to cozy up to this otherwise-waning retailer so peculiar. In case you missed it, at the end of last week, the companies announced a new strategic partnership, under which Samsung will open stores-within-stores inside all Best Buy locations by the middle of this year.

"Samsung sees the boutiques as an opportunity to educate shoppers about its products and sell some of its less-well-known gadgets," one of the company's marketing executives told The Wall Street Journal. And on Best Buy's side, "the new departments are part of Chief Executive Hubert Joly's effort to focus the stores on fast-selling products and strengthen relationships with key vendors."

This is clearly marrying up for Best Buy. Since the advent of online retail, the bricks-and-mortar retailer has struggled to drive traffic into its stores and convert what traffic is there into higher sales. As a result, for the 12 months ended Feb. 2, its same-store sales were down 2.9% according to Standard & Poor's Capital IQ. It has nothing to lose, in other words, by entering into the agreement with Samsung -- and thus the reason its shares led the S&P 500 (SNPINDEX: ^GSPC  ) last week.

The same, however, can't be said for Samsung itself. To revisit the matrimonial analogy, this is a clear case of marrying down for the South Korean electronics maker -- and I mean way down.

It seems obvious that Samsung's strategy here is to quickly and relatively inexpensively establish a retail presence to challenge Apple's (NASDAQ: AAPL  ) . But one of the reasons Apple stores have been so successful -- beyond the quality of the products, of course -- is that they're teaming with a friendly and knowledgeable staff that's eager to please. Suffice it to say, at least in my opinion, that the same cannot be said of Best Buy.

The one saving grace is that Samsung is purportedly going to both staff and train the employees in its boutiques. Again, according to the Journal, "For the first time, [Samsung] is recruiting and training a fleet of retail workers who will staff the majority of the boutiques."

But the question of who will pay and supervise them once onboard will ultimately dictate the outcome. If Best Buy managers and personnel are responsible for this, are we really to expect something dramatically different than the status quo? And if Samsung is going to, then it seems inevitable that the company will demand a bigger cut of the sales -- something that Best Buy swears isn't the case.

Either way, I can't help seeing this partnership being anything but a short-term boost to Best Buy and a potential stain on Samsung's increasingly sterling reputation. This is why I believe that the biggest beneficiary of the deal could ultimately turn out to be Apple.

The battle between bricks-and-mortar stores and e-commerce rages on, with Best Buy caught in the middle. After what might have been its most tumultuous year in history, there are now even more unanswered questions about the future for the big-box electronics retailer. How will new leadership perform? Will old leadership take the company private? Will a smaller store format work out for both the company and its brave investors? Should you be one such brave investor? To help answer all these questions, The Motley Fool has released a new premium research report detailing the opportunities -- and the risks -- in store for Best Buy. Simply click here now to claim your comprehensive report today.


Read/Post Comments (33) | Recommend This Article (17)

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  • Report this Comment On April 06, 2013, at 4:15 PM, brainsmith wrote:

    Mr. Maxfield, I really think that you should speak less of your experiences as the electronics snob that you are and do a little homework on the satisfaction of the masses at Best Buy. There are some very satisfied customers leaving the doors at Best Buy, who have recieved an experience that near no one else could give them. Target understands this as well and has enlisted this experience for their customers as well. I don't expect perfection from the Best Buy I shop at but it is the ONLY place to get what I want today and to have better support than I could ever get online, even if it isn't perfect. There must be a reason the Big Box is still there and I believe it will be sorely missed if it disappers. You just don't like interactions with people based on your responses of preferring to shop Costco and Amazon, true?

  • Report this Comment On April 06, 2013, at 4:53 PM, litton88 wrote:

    North Korea will sink Samsung.

    I sure am NOT buying anything Samsung because Kim Jung Un will void my warranty.

  • Report this Comment On April 06, 2013, at 4:55 PM, jdoig wrote:

    Come to my local BBY in Sugar Land, TX. I find it the best electronics shoppinbg experince in town. The Geek Desk is as good as it gets. Floor staff are well versed and helpful in every department. And, if they don't know will get someone who does. I like SAMs and COSTCO for gallon jars os pickels and 5-lbs of apples in a bag, but being able to see all and compare is priceless. Shopping at aBBY and then going on-line or getting the deal of the month (not what you want, but "close") may be "worth it" to you, but it is what it is....a customer's sharp practice.

  • Report this Comment On April 06, 2013, at 5:01 PM, jOHnWasHereToday wrote:

    I think it is highly unprofessional to write an article slamming a company without any specific information to support the argument. It might be true that Best Buy has bad customer service, but it seems like you don't know why YOU are saying that.

  • Report this Comment On April 06, 2013, at 5:26 PM, jdluvr wrote:

    I've never had a bad experience at Best Buy. I think that projecting a bad experience at one store on an entire chain is a little petty.

  • Report this Comment On April 06, 2013, at 5:38 PM, vanishingpoint1 wrote:

    Well I guess it's clear that this editor is VERY JADED! I've spent a great deal of money at Best Buy in Illinois, just in the past 30 days. The customer service was great. The price was competitve with any online opportunities including Amazon. I had problems with one of the products I bought. Best Buy inmmediately replaced it on the spot. They have THE BEST extended warranty program in the industry. And, I got free financing for 18 months? Then they sent me a $15 coupon, just for being a faithful customer. Uh....I just don't get where this idiot is coming from. Really?! He had one bad experience, one day, and that's how he judges an entire compnay and then throws them under the bus on a his website? Maybe WE NEED TO SHOP SOMEWHERE ELSE...for news!

  • Report this Comment On April 06, 2013, at 5:49 PM, Bobby124 wrote:

    I buy a lot of stuff online, but I love shopping at Best Buy! They have an excellent selection of digital cameras, and usually have someone around to answer questions and offer good advice, based on your price point. I bought a Sony Cyber-shot at Best Buy, and I love it! When Apple came out with the iPod Nano, I bought 2 of them for the kids at Best Buy, because they had a great assortment of colors and someone to help me! In my opinion, Samsung made a terrific marketing decision in partnering with Best Buy!

  • Report this Comment On April 06, 2013, at 5:58 PM, Tinatay wrote:

    I stopped shopping at Best Buy over a year ago, when 2 different stores, and multiple employees failed to deliver acceptable customer service. Long story short... I had a problem with a return. The stores alleged they could not override the computer, which would not accept the return. A manager was finally going to give me a gift certificate, when the cashier, who was the first person I spoke to at the second store, told him how to override the computer. I knew there had to be a way to override the computer's refusal to accept my return. The solution was simply to not enter my driver license number. I stopped shopping there because they acted like they were doing me a favor, by accepting my return.

  • Report this Comment On April 06, 2013, at 6:29 PM, joel7th wrote:

    Honestly Mr. Maxfield i really dislike reading your articles all you do is critisize BestBuy and other big box stores, well let me tell you something you cant compare online to big box it is a totally diffrent expirience and i hate how you just trash retailers because you maybe have had one bad expirience. and as a Reply to one of the gentlemen who Tinatay if your outside of a return policy why would you blame a store for your mistake you want terrible customer service think walmart!

  • Report this Comment On April 06, 2013, at 6:34 PM, darrynlee wrote:

    Samsung's area in Best Buy will be separate from the rest of the store. Why would they HIRE and train the personnel if Best Buy will be responsible for everything there. It will be the same as Comcast. Their people have an area in the stores in Utah and they only know Comcast stuff. Your bias against Best Buy is too glaring to be objective about anything.

  • Report this Comment On April 06, 2013, at 7:19 PM, buyreal wrote:

    Let's see, it's the unethical marketing machine of Samsung teaming up with the so-so service of BB. Samsung has been known to use hired hands acting as third party to aggressively talk up its products while defaming others. While many companies are no saints in this area, IMHO buying Samsung is helping a dirty company to kill more American companies, therefore causing more American job lose.

  • Report this Comment On April 06, 2013, at 7:21 PM, tech4all wrote:

    To the Author of this article:

    Speak for yourself and your local Best Buy store(s). The one's in my area are great. Not bad mouth a company based on one store or employee. It discredits you as an author.

    "Is it just me, or is going into a Best Buy (NYSE: BBY ) a little like getting poked in the eye?"

    It's just you.

    "Perhaps I'm being too harsh here."

    Perhaps yes.

    "I admittedly don't frequent electronics stores in general, or Best Buy in particular. Like a growing number of consumers, I buy my electronics either online or at Costco. Beyond price, I really do find visits to Best Buy increasingly dreadful. While it may claim to "deliver a high quality customer experience," I prefer a complete absence of customer service (a la Amazon.com) over what's offered at Best Buy."

    I hope you're not one of the folks who goes into a store, waste an associates time to ask about a product, then goes to buy it online. I've worked retail and we were trained to know how to read customers. Once your mentioned anything about going online, I zip my mouth and tell you nothing.

    Calling Best Buy "dreadful" makes you out to be a drama queen.

    There's more to call you out on, but it's not worth more of time.

    Bad article. Will not be reading more of your articles Mr. Maxfield.

  • Report this Comment On April 06, 2013, at 7:35 PM, harkonen2112 wrote:

    Although I'm all for fair journalism and not taking sides, that said I'm afraid I side with the columnist. I'm had many dealing with Best Buy at several locations, all of them being disappointing ones. I've read about how they treat their employees and it seems that this has lead to disenfranchised workers. I'm not one to blast a store, I simply vote with my wallet and shop elsewhere. Most likely the shopping experience varies due to local management but it's hard to ignore the hits that this company has taken. Btw my local WalMarts have terrific customer service so it can be done, if you treat your employees fairly and with respect.

  • Report this Comment On April 06, 2013, at 7:37 PM, norcalandrew wrote:

    Your BEST BUY is always at FRYS...

  • Report this Comment On April 06, 2013, at 7:53 PM, drgrzz76 wrote:

    I never had a problem with Best Buy. Now WALGREENS. I swear there is like no service and the drugs you get are never right.

  • Report this Comment On April 06, 2013, at 8:29 PM, citishark1 wrote:

    Sorry to disapoint most of the mad -some even rabid!- people making comments so far. My experience and reaction with BB will not please them, but not my fault. After being an enthus customer of them, 7 yrs ago I got my last 3 experiences with that firm. 1 store in LA and 2 in TX i visited and the service was terrible: courtesy, knowledge, interest in take care of me from sales people was terrible. Iasked to talk with management (NOT necessary the GM!!) and I got nowhere. Geek squad was the last stone for me: i got a cocky, insolent, all knowing (but customer service) fat slob coming to my home and not answering my questions or informing me of the theater set I was buying. Needless to say it went back to the store with their "geek". 27 minui went to the store, got my refund and cancel my account with them never to come back to any other of their stores.

    As investor buyed it at $23.95 (May xx, 2003) and aftr my experience did not make too much sense to hold it anymore. 6 months later I sold it @$43.29 (May xx 2008), the last good experience about BBY. Looking at the chart seems to me that I was correct in my decisions.

  • Report this Comment On April 06, 2013, at 9:39 PM, tychicum wrote:

    Dear Leader Kim Jung Un is the undoing of Samsung. BestBuy is only there to speed things up.

  • Report this Comment On April 06, 2013, at 9:55 PM, buzzltyr wrote:

    oh I agree, I get much better customer service at walmart and amazon.

    What a joke, I am so glad to see best buy kicking it. They make more than amazon, sell more than amazon and cost pennie on the dollar compared to amazon.

    AT least they HAVE customer service, sorry you do not like it, I can't say I do no like amazons customer service becasue they have none

  • Report this Comment On April 06, 2013, at 10:15 PM, sugagb18 wrote:

    Stockholders in three of Best Buy's most significant competitors - Apple, Amazon, and Costco - this article is not biased at all.

  • Report this Comment On April 06, 2013, at 10:16 PM, birder1500 wrote:

    I had just one experience with Best Buy customer service and it was an absolute disaster. My son wanted a boom box a long time ago and I bought him one from Best (Worst) Buy along with an extended warrantee. Sure enough the boom box crapped out, but we had an extended warrantee. We took it to Best Buy for a fix. Three months later they called to say it was fixed. We picked it up. The speakers were not there. They were gone. They would not return our money. They insisted that they did not owe us a refund. What a piece of crap company.

  • Report this Comment On April 06, 2013, at 10:22 PM, sidred123 wrote:

    I have had very good service and experienced Best Buy employees who have answered questions and went out of their way to help. I have had some who have been indifferent and some who were rude and far worse incompetent. Specifically the Geek squad who erased my computer data by mistake. No apology no explanation , no shopping by me there ever again. They seem like a company on the downslide, much like Home Depot was before they decided to get customer service back as a primary function of their job.

    Sid

  • Report this Comment On April 07, 2013, at 12:22 AM, puppybone69 wrote:

    Nevermind their terrible service, what about their terrible selection? They used to carry every CD, DVD, and video game ever made, now they only carry whatever unsold inventory of those items they still have remaining. New releases? Not on their shelves, but that's always been the case with them. They advertise them in the Sunday paper as being on sale in their stores every Tuesday, but show up there on Tuesday and not only are they not on their shelves, their employees are surprised to see their ads indeed advertised them being on sale that day! Gee, why is Best Buy still losing sales to Amazon?

  • Report this Comment On April 07, 2013, at 3:12 AM, Tools1234 wrote:

    I have read the motley fool for years looking for advice and realized the amateur analysis telling only biased parts and leaving out key details has cost me, motley fool ihas become tabloid articles with limited research and no first hand knowledge. i would like to see more expert advice with detailed research and analysis instead of personal bias without accurate and complete details. i read motley fool for fun now like a cartoon strip but will never make stock trades based on its articles again. when you hire professional journalist and analysts that do their research and understand the business they write about let us know. thanks for the bad information and my losses.

  • Report this Comment On April 07, 2013, at 3:24 AM, Dadw5boys wrote:

    This sound like the same experiences I have had with Best Buy. They tried each time to give me the bum rush acting like I did not understand the technology.

    I just got my money back and never went back.

    I don't have time for someone to play games I had a problem and they ignored it and chose to belittle me.

  • Report this Comment On April 07, 2013, at 8:07 AM, leotangarcia36 wrote:

    i definitely agree with Tools1234. Well, Mr. Maxfield has the right to express himself - freedom of expression. But, his credibility as a writer???? looking forward to read more credulous articles based on research. regardless which store you shop there will be unsatisfied customers and unpleasant employees.

    based on my experienced, i went to best buy last week for 2 consecutive days, i bought the same product from the same customer service employee, the first day he was nice the next day he was having a bad day. but overall, I'm a happy best buy shopper. :)

  • Report this Comment On April 07, 2013, at 8:42 AM, GABCAN wrote:

    When my son used to work for Best Buy in his training class they were told that the preferred customers were "Jills". That is a code word for skinny blond White women with plenty of extra money to spend that were not very bright. They could be talked into buying any and everything with no questions asked.

    Best Buy has a secret policy to sell add ons and Geek Squad services to maximize profits even if they are not needed. The Jills were easy targets.

    My son chose to concentrate on selling big screen televisions and PS3's to men that enjoyed football and he did very well. He avoided the Jills because he did not believe in being manipulative to make money.

  • Report this Comment On April 07, 2013, at 8:55 AM, rewdawg1 wrote:

    Best Buy has some of the best customer service in the biz. The fools that write on here have been getting BBY wrong for a long time now though so nothing new.

  • Report this Comment On April 07, 2013, at 9:03 AM, MRWheat1 wrote:

    Cross your fingers we can only hope it does. Google, Facebook, Microsoft and Android are all Big Brother Enablers, I hope every last one of these companies and products sink into the abyss.

  • Report this Comment On April 07, 2013, at 10:11 AM, stillermadman wrote:

    The biggest problem with Best Buy is: If you don't purchase their HIGH priced EXtended warranty, which is typically about 25% of the price of the item, they basically won't help you. Even if the product is still fairly new, and covered by the manufacturer's warranty. Also, while their staff is more knowledgable than most electronics stores, the so called Geek Squad experts, typically have base level IT knowledge only. I DOn't hate Best Buy, and probably prefer them over other electronics stores, but their warranty policy is a stumbling block for me for future large purchases.

  • Report this Comment On April 07, 2013, at 10:42 AM, lorimf wrote:

    Oh, THANK you!! I wondered if it was just me....

    I am a 67 yr old female who, since Computers Day 2 or so has had the opportunity to be involved with and the interest to stay involved with, electronics of many kinds. I do lots of research and am a gadgets geek~so when I go into a BB to "play and learn" I do NOT appreciate being told by some 17 yr old jerk who knows 1/4 as much as I do, if that, how to turn on a smartphone.

    Lesson to salesperson~don't prejudge. It's one of the basics which you've apparently never been taught.

  • Report this Comment On April 07, 2013, at 1:20 PM, gameboymaster01 wrote:

    Lol this article made me laugh. The author CLEARLY has no sense of morality here.

    I personally love Best Buy. The ones near where I live are both friendly and informative. And I'm sorry you seem to be the type of guy who hates interacting with people and prefers online. But just because one store might have given you a bad taste in your mouth, don't knock the rest of the company. Samsung is a very smart and decisive company. I believe their partnership with Best Buy will be one of the best ideas they ever had.

    I first thought this guy hates everything about everyone but seems to really highlight and enjoy Apple. Why would he throw everyone else into the garbage heap and put Apple so high in the spotlight??? Oh wait... at the bottom of the article it says you own Apple stock. That makes sense. Slander everyone else so more people buy Apple. That was a good one. Made me laugh at least. :)

  • Report this Comment On April 08, 2013, at 6:40 AM, uva90 wrote:

    As I read through the comments, I am sadden how some of you have stepped to Mr. Maxfields level. As for some of you, I can understand you not wanting to go back to Best Buy when you have been burned more than once but some of you haven't been there in years or only have been once and feel like you have an opinion.

    I have shopped at Best Buy for years and have literally spent over $100,000 with Best Buy and have had good and bad customer service but have seen a huge change for the better. There are thousands of Best Buy's out there and to get a consistent company is nearly impossible but what Best Buy is doing now could change all that. The new CEO is very impessive and with his background will get Best Buy back where they were. I only see good things coming from this company, that's why I have invested in Best Buy stock. I am happy to see the stock rise daily.

    Mr. Maxfield, if you want to dump on a company with terrible customer service, look at Walmart. Based on your comments, I think you just might be one of those greeter at the door.

    DON'T quit your day job!!!!

  • Report this Comment On April 08, 2013, at 6:56 AM, mhtpro31 wrote:

    I think this says all we need to know about why this article was written in the manor it was.

    "John Maxfield owns shares of Apple. The Motley Fool recommends and owns shares of Amazon.com, Apple, and Costco Wholesale. "

    It is clear to me that this “fool” will never give credit to Best Buy for any of the changes they have made to address there challenges. They may have a long way to go but in a time of high unemployment I am glad to see a stand and fight to survive instead of cutting jobs to save profits.

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