Customers wait outside a Best Buy store in downtown Toronto, Ontario on November 23, 2020 to pick up their orders online.
Geoff Robbins | AFP | Getty Images
Best Buy is testing a new annual subscription program that includes benefits such as technical support, free shipping, and extended warranties on smartphones or other purchases.
The consumer electronics retailer said Wednesday in a corporate blog post that the program is available in some stores in Iowa, Oklahoma and eastern Pennsylvania. It will be expanded to stores in Minnesota, North Carolina and Tennessee later this month. By the end of the month, it will be piloted in about 60 stores.
The program, called Best Buy Beta, will cost $ 199.99 per year or $ 179.99 per year for customers who have the retailer’s credit card.
Best Buy sales have risen over the past year as consumers bought technology to work, go to school and spend time at home during the Covid pandemic. Online and in-store sales for at least 14 months grew 9.7% in the most recent fiscal year, which ended Jan. 30, compared to the previous year. However, growth in these sales fell sharply from 23% in the third quarter to 12.6% in the fourth quarter.
The retailer expects the growth rate to slow further, especially after a year of unusually high sales. Chief Financial Officer Matt Bilunas said sales at the same store will range from a 2% drop to a 1% gain. He said Best Buy predicts more people will spend money on eating out and traveling again.
With the membership program, Best Buy hopes to increase sales beyond the pandemic and win more customer portfolios. It follows the book of games from competitors such as Amazon and Walmart. Walmart launched its own program, Walmart +, last year with benefits such as unlimited grocery delivery and fuel discounts. It costs $ 98 a year. Amazon Prime has gained over 150 million paid members worldwide in the last 15 years with fast, free deliveries and a huge library of TV shows and movies. Prime members are $ 119 a year.
The advantages of Best Buy adapt to technology. Customers who join the membership program receive unlimited technical assistance from Geek Squad, 24-hour concierge service, exclusive prices for merchandise members, and free installation of many appliances and products. They also receive two-year warranties on most purchases, including Apple products like iPhones.
“As we want to evolve our membership programs, the goal of Best Buy Beta is to create a membership experience that they will love and make them feel safe throughout their relationship with Best Buy,” said Allison Peterson, Customer Director of Best Buy. on the company website.