Lousy customer service sank Best Buy and Sears, not the Internet - Macleans.ca

Lousy customer service sank Best Buy and Sears, not the Internet

Job losses reflect simple truth: customer is always right


More than 1,600 retail workers lost their jobs on Jan. 31, as Sears Canada laid off employees and Best Buy Canada closed 15 big box stores. Retail experts quickly blamed the increase on Internet shopping and the imminent arrival of Target in Canada for the job losses. But Best Buy and Sears wouldn’t be vulnerable to these threats if not for a more fundamental problem: Lousy customer service. The big story in Canadian retail right now isn’t really about the rise of e-commerce or a new competitor. It’s that one of the central tenets of shopping—the customer is always right—is once again a life or death commandment.

Customers, of course, are not infallible. But the “customer is always right”—coined either by Marshall Field or Harry Selfridge—suggests shopkeepers must always remember that they exist to serve consumers, not the other way around. But shopping at a Best Buy, or one of the company’s Future Shop locations, is most often an exercise in annoyance rather than respect. Customers complain that sales staff were difficult to find and unknowledgeable or pushy when they did materialize. Sears suffered similar problems; in some locations, you are more likely to spot a Yeti than a sales associate. Both Best Buy and Sears trailed far behind competitors like Costco and Sam’s Club in pleasing their patrons, according to the American Customer Satisfaction Index (ACSI), an annual survey of 70,000 shoppers. More tellingly, they also scored far behind Amazon. And so, yes, customers are fleeing big box stores because shopping online is more convenient and cheaper. But they’re also switching to a competitor that’s actually treats them better.

Target also received exemplary grades from customers. As Richard Warnica explained in a recent issue of Canadian Business, the American chain has built its brand on offering a pleasant, enjoyable shopping experience. Each aisle in a Target store is wide enough to accommodate two shopping carts side-by-side and there’s no annoying Muzak. Marketing professor Robert Kozinets told Warnica: “Department stores aren’t known for being pleasant, but Target manages to do that.”

This is where the opportunity is now for brick-and-mortar retailers. They may not be able to compete with e-commerce for inventory, convenience or cost, but they can offer atmosphere, service and expertise. Consider Apple stores, with their Genius Bars dedicated to helping Luddites navigate technology, or Lululemon, where friendly staff ease first-timers into their yoga pants. Neither the Internet nor Target killed Best Buy and Sears. They just gave consumers a chance to flee to stores where they were, once again, always right.

Filed under:

Lousy customer service sank Best Buy and Sears, not the Internet

  1. I live in Asia now. All those shops had untrained people I trained people in customer service for 20 yrs They have not even one human that could be knowledgeable in anything

  2. Good point. Where I live, “Kent” took over an old retail hardware store, but all the staff was retained(so far). So, if I go there, I still get service. People who’ve been there for years, always wanting to help, with expertise.

    I actually went in one time and was wanting something that might have cost 10 bucks…by the end, the salesperson realized all I needed was a certain screw, and took it out storage and gave it to me! No charge!

    Realizing you can get help like that is the hope against cheaper online retailers. Like you point out, has Best-buy or Sears been offering ANYTHING even remotely like that?

  3. I grew up with Sears….used to get everything from them. In Ont and other provinces.

    60 years. I tried to stay loyal, I really did…..but it’s gone steadily downhill for ages now.

    Finally this last year, I’d had enough. I’ve never seen so many bad business decisions.

    And absolutely lousy customer service.

    So I tossed the catalogues, refuse to go anywhere near their store….and if they go belly-up….well, adios. No sympathy.

  4. Not to let the facts get in the way of a good story, but how many of the Best Buy closures involve locations within a block of a Future Shop store?

    • Problem is, Future Shop was so bad I switched to BestBuy when they opened up here. They were very good for my computer dealings, not so much with tv’s. There is no way I’m going back to F.S.

      • It’s the same company!

    • You’re right of course. Best Buy problems are from a very very poor sense of business strategy. They never got a handle on running two almost identical competing companies. Never established different identities for the brands.

    • The problem with future shop vs best buy is that future shop works on commission. Its like being a deer in the woods in there! And there return policies are terrible, and that goes for all of them. If I can not return a faulty or unsatisfying product I won’t shop there.

  5. I regularly shopped at Target when I lived in the U.S., because they provide a pleasant, spacious, helpful atmosphere with no lineups at the cash register. They are bucking the trend toward aisles cluttered with columns of merchandise and the air full of “in-store radio” consisting of sales pitches and grating music. In a word, you feel like you’re being treated with respect. I’m delighted to see them coming to my town, and I hope they keep their policies intact.

  6. Contrary to what you say, Best Buy in Victoria, BC had what I would call “world class” customer service. And we all know that is not going to be allowed in Canada. How would Future Shop and other stores survive.

    • As an ex-employee from the Victoria store. I want to thank you. We tried really hard to give the best service possible. The problem with the location was that it cost over $100,000 per month in rent and 1/2 of the store was dedicated to T.V.s which no one was buying. The store never made profit no matter how hard we tried.

      The only way someone would take a TV is at a serious discount and TV’s were the only hardware products that had a good profit margin. Computers, and video game systems netted us $1 per unit sold. Accessories had huge margins but nobody wanted to pay the price when they could go somewhere else and get it for 1/4 of the price.

      It’s a bad system that best buy is entangled in. They made huge profits when everyone was switching their TV’s to flat screens. Once that ended, profit dried up. They were hoping 3D TV’s would re-charge the market but how many people do you know who have one, and is that something anybody is seriously contemplating buying? It’s a luxury item not a necessity.

      The future of bestbuy will be small outlet stores like the source (RadioShack) consisting of tablets, laptops, and cellphones.

      Be prepared for further big box closing’s. too bad, it was a fun place to work : (

  7. I have given up on Best Buy and Future Shop for the incredibly disinterested service and general lack of knowledge. The service at the closest Best Buy is the worst of any large store I can think of now that Zellers has closed. I have spent a lot of money at Future Shop since the early days when they were a fly by night, sell out of the boxes outfit. In the last couple of years I have spent very little. Staples gets most of my business for tech related items and NCIX gets the rest. True story – I just returned a pair of used Monster earbuds to the local Best Buy (earwax and all) that had been repackaged. It took four days for them to respond to my initial complaint and even then the manager hadn’t been given all the details that I had provided. I am still grossed out. Since I live out of town I wasn’t about to drive two hours to return them so I started the process online. For the most part good service gets my business. Sears is awful and so is their merchandising. We travel in the US often and Target beats pretty much everyone in Canada for store layout and service.

  8. I hold to the view that “The customer is always right” was coined by John Wannamaker of Philadelphia. So does Alex Trebek. Who’s going to argue with him?

  9. High prices are sinking Sears and Best Buy. It’s as simple as that…

  10. Just one more comment on the Apple example. There will only be ONE Apple type success, because, like Zappos,it’s not emulatable. The “cool” factor is huge, as was their cachet from the start decades ago. Beyond that, keep in mind that Apple charges some 30-40% MORE for their products compared to competitors that offer similar features. That’s hundreds of dollars per sale more, which gives them the extra to provide these cool, trendy support places. Apple isn’t succeeding because of their customer service alone, but as much for their ability to build a brand. Best Buy, Sears,etc, have no competitive advantages to provide because they haven’t changed enough, are not built from the ground up like Apple to be “cool”.

  11. I gave up on Sears 15 years ago over poor quality in their products at the time. It got so bad that even gifts from there ended up being declined politely. About the only service i did get in the store was security, to the point that one day I said to security to use her radio in her purse to see if a sales rep could be sent to furnishings because I wanted to buy a particular chair, but nobody had been in the department for two hours.

    I still like Best Buy, but I get computer electronics at Costco or Staples, as most of the computer customers of Best Buy seem to need the Geek Squad. Future Shop used to be good in the days of physical software packages, but now the pair of them seem to offer little more beyond comparing televisions. As category killers, they’ve now also killed it for themselves.

  12. I worked for a big box retailer some years ago and “showrooming” was such a big problem back then I left the business. I’m actually surprised some are looking at this as a new thing, although it’s probably because of the recent Best Buy and Sears troubles.

    It all boils down to this. You can’t open a brick and mortar store with all the products neatly displayed, with trained knowledgeable staff, great customer service, and have the same prices or lower than an online merchant that operates out of a warehouse staffed by box movers. It’s impossible and such a store will eventually go out of business.

    Our store had knowledgeable salespeople that could demonstrate any product and answer any question you could possibly dream up. We had free delivery and would even set up your new TV or Home Theater system as well.. FOR FREE. We would also offer after-sale support if the customer had any questions or problems with their purchase.

    What would happen? You would spend an hour or more with a customer helping them find the right product, and at the end they would turn around and say they could buy the same item online for 10-20 bucks cheaper.

    I would ask them if the online retailer could give them the same type of before and after service. Do they have free delivery and setup? How about actually being able to see, hear, and use the TV or audio system and answer any questions before they paid for it.

    The response was always the same, delivered in a very cold tone, “Can you beat their price or not.”

    Meanwhile other customers would walk out because they were not offered help in a timely manner. Why? Because the other salespeople would be occupied by showroomers! Hire more staff? Then all the salespeople make less money (more sharing the same pie) and in turn they would leave, starting a vicious circle.

    These stores would eventually go out of business and be replaced by Best Buy stores, where their staff are paid slightly above minimum wage, so they could at least try to compete with online retailers. Needless to say the turnover ratio of staff is high, which explains their lack of product knowledge or customer service skills.

    The sad fact is “most” people only care about price, and it is because of these people that the rest who care more about about service are left out in the cold and frustrated. You simply can’t have it both ways.

    • I like your comment and I agree with you. Your comment is spot-on. The people who care about service do not realize how difficult it is for a business to survive based on service… price is always the biggest factor.

      My personal experience is that I will avoid looking for service in a store when I know that it’s price that matters most to me. If for some reason I have engaged the service people, I do feel an obligation to that one store to make the purchase there (if I decide to buy at all), rather than elsewhere.

      This is the biggest conundrum in bricks and mortar retail today. You can go online to get all the information you need, all the reviews you need, and the lowest prices. In some cases you may want to see a product first-hand… but even then the prices need to be at least close to the online price or you will want to go back home and order it online. Good service alone will never be enough.

  13. Customer service in Canada is a double-edged sword. In Canada sales people are generally attentive, and even aggressive. It’s great in a restaurant or a bar. It’s great in a store when you have a lot of questions.

    But I’ve found it annoying in many stores. I actually avoid browsing in a store when I know the salesperson will be right on top of me, trying to engage me in a sale. It’s just not worth the annoyance sometimes. No matter how pleasant they may try to be, you know they have one goal in mind, and that’s to get you to spend money.

    I’ve never disliked Best Buy customer service, but I do dislike Future shop customer service. Future shop salespeople are on commission and Best Buy are not, so Best Buy salespeople tend to leave you alone unless you engage them yourself (although sometimes Best Buy people don’t seem to care much at all). Future shop people are always trying to con you into buying completely useless accessories.

  14. I have almost always found that Best Buy service is terrible but Future Shop is acceptable….Probably because FS pays their sales staff commissions and Best Buy does not…Curious because BB owes FS

  15. I worked as a customer service rep for best buy.com for a bit. As a front liner I was limited as to what I could do to help the customer. I would have to send the issue to the research dept to get resolved. Sometimes it would take a while for them to get to the issue. I know because I had quite a few call to check on when there case would be resolved. So I can see how inadequate customer service is killing business.

  16. The reason sears is doing so poorly is that they no longer provide the high quality products and customer service they once did. Most of the goods they sell are the same cheaply made imported products already available at Walmart, but at a higher price.

  17. If Best Buy really wanted to resolve their issues at their Future Shop locations, they’d convert all their sales folks to non-commission and allow them to float between sections, seeking out customers that need help. These days, I walk into the local Future Shop and there’s three employees having a good old time chatting it up in the home entertainment section, another employee chatting up a female employee in the camera section, and nobody available to help in the lower value areas where people need help. Finally when you flag someone down in another location they tell you they can’t help you but they’ll get ‘so-and-so’ cause that’s his section, and then as you’re checking out, so-and-so will complain about how dead it is… Future Shop cares less for the customers and more for the commission.

  18. The truth hurts sometimes…but this is the truth from the customer’s perspective.. of that I am sure. Retail sales associates offer the best service they can and as efficiently as they can, given their capabilities and need to follow company policy. Associates at the retail level are put in a tough spot and aren’t given the credit they deserve in these tough retail times. They don’t deserve to be ‘dismissed’ because retailers are slow to adapt to customer’s needs. Instead of being a step ahead, it seems, they are a big step behind. Retail will continue to change shape but Sears will always be around in some shape or form.

  19. I stopped doing business with Best Buy in 1998 because of poor customer service. And I agree with the statement concerning the attitude of their ‘Sales Reps’. Most will hang out where customers have no hope of finding them.

  20. Not true, one sided write ups like this is clearly why Macleans has failed as a magazine. can you even buy this in the magazine rack anymore? Jumping from Best Buy Canada and Sears Canada and then using an American statistic (acsi) is unprofessional. What happens at these retails in this index in the U.S. is not indicative of what is happening in Canada.
    Online shopping is smaller in Canada than the U.S.(for now) due to the Amazon factor. Amazon won consumer thru price, nothing more. If you live in the U.S. and bought at a Sears or Best Buy, Target, Walmart, etc. you pay a sales tax. Up to almost 10% in some states. Amazon fell into a loophole and did not have to charge consumers state tax, and along with competitive prices, won the day. (They officially did not reside in those states as they were e-commerce) Not so yet, in Canada. Our government did not have the same loophole, and destination provincial taxes have to be charged on every shipment. That is why Amazon does not have the same following in Canada.
    Macleans, for the record Canada is different than the U.S. in many many ways. If you talk about Canada, stick to Canadian facts and comparisons please.

  21. Sears is scrambling to find a niche , as the American retail giants take over.
    The demographic, the times , the market has changed. Most people shop price now not service.
    Management continues to try and fit a round peg in what is now a square hole.
    Squeezing ever more out of the sales staff…..each person now doing the job that 3 did in the past. Working for slightly over minimum wage…..and the crapiest hours imaginable!

    My Dad worked at Eatons all his working life as a shop at home decorating consultant. Was the sole breadwinner ,mom was at home with 7 kids. Believe it or not we were OK,
    no not rich….but not poor. Dad made about $35k a year back in the 70’s in Montreal…the equivalent of about 130 k today. Being in the business myself, nowadays… the average is about 25k a year.

    The problem is that customer’s have expectations based on an old model . While retailers would like to deliver on those expectations …..they simply can’t.
    Eaton’s lost their niche…. and died…..Sears will die also, unless it finds a way to radically reinvent itself. Perception becomes reality….and given the perception lately , the closing of stores, the sourcing out of its Installed Products division, all of which raises their shares…something companies do just before they sell off.
    “The times they are a changin.”