Circuit City Vs Best Buy Marketing – Why Circuit City Failed and Best Buy Won
Circuit City vs Best Buy marketing should be evaluated as it shows the reason for the increasing disparity between the two companies in annual sales. Circuit City and Best Buy were the top two retail chains for electronics in the United States. In recent history, Best Buy eliminated Circuit City from the marketplace. Why did Circuit City lose out to Best Buy and what, if anything, could they have done to close the gap? The primary reason is Best Buy had done a better job of utilizing viral marketing through brand recognition, incentives and customer service.
Best Buy used to be absolutely atrocious when it came to customer service issues. I recall standing in line for three hours one Saturday afternoon return a car stereo system that broke. The car stereo system that broke was actually not installed correctly in the first place by Best Buy and to make matters more frustrating I had paid an extra $100 to have the service plan. To make a long story short, I was standing in one line after another only to have to schedule an appointment to come back and do it all over again. This nonsense persisted for a few weeks. I was livid and determined to never set foot in Best Buy again. I made sure that everyone I knew was informed of the poor customer service at Best Buy and soon found out I wasn’t the only one that felt that way. Viral marketing was at work, but it was not working in the favor of Best Buy.
In the last few years Best Buy has made tremendous strides in putting the customer first. This has showed in its stock price relative to Circuit City as Circuit City had been running into issues with keeping its customers satisfied. Best Buy is offering rewards programs for its customers to receive discounts and accepting returns with an immediate in store replacement under their service plan. I have been hearing from the same people that used to promise they would never return to Best Buy about how much they have improved. The same people that used to boycott are now the biggest advocates and account for an impactful aspect of their overall marketing.
A good name in business cannot be overlooked; in fact, it is probably the single most important component for growth. In a day when viral marketing and the rapid spread of information over the internet consumer feedback reverberates to millions almost overnight. The internet and viral marketing can be the best friend of a major corporation or its worst enemy. Doing right by customers will result in positive growth and the more a business can separate itself from its competitors in terms of a solid customer experience the more rapidly it will rise to number one in its industry.