Best Buy Admits To Misleading Customers With Kiosks
Written by Evan SchumanAfter more than three-and-a-half years of courtroom battles with the Connecticut Attorney General’s office, Best Buy on Monday (Dec. 13) admitted that its in-store kiosks tricked consumers out of Web price-matching and agreed to pay consumers in that state $399,000.
The chain also said it would stop showing higher prices on its in-store kiosks and would “conspicuously disclose to consumers” if the kiosk was displaying lower prices. Although the settlement is unlikely a cause for celebration at Best Buy, the chain actually fared quite well and will sustain little pain from it.
Editor’s Note:
Why little pain? A $399,000 settlement is not a huge deterrent for a $50 billion chain, but it might become more annoying if it spreads to many other states. (If every other U.S. state and Washington, D.C., reached a similar settlement, it would still only be $20 million. At this stage, though, three years after Connecticut filed its charges, it’s unlikely any other states or territories would begin actions.)
The actions required—the halting of the deceptive kiosk program—are trivial; that program had pretty much run its course. Mobile-equipped shoppers also make it irrelevant: A consumer who wants to prove the price of a Best Buy Web offer could simply do it on his/her phone. Therefore, Best Buy has agreed to put an end to a program that it pretty much had stopped pursuing some time ago anyway. Hardly a stinging penalty that will teach the chain a lesson about never try anything like this again.
The original problem stemmed from Best Buy’s 2007 efforts at price-matching. Customers would see a low price on the Best Buy site and drive to a local store to pick up the product. When in the store, if they noticed that the in-store price was higher, they’d approach an associate asking for the chain to price-match its own site, as Best Buy advertised it would do. The associate would walk the customer to the in-store kiosk to check BestBuy.com to verify the lower rate. Lo and behold, the site showed the same in-store price. The consumer would typically shrug, assume that they misread it or that the sale had ended and abandon the attempt at the price-match.
The problem was that the kiosk wasn’t showing the site’s Web store. It was showing a site that looked identical to the Web site, except that it had higher prices. Best Buy’s explanation at the time was that it wanted to have a kiosk in-store that displayed in-store prices. Given that in-store and online prices were different, it didn’t make sense, the chain argued, to have a kiosk showing the lower online pricing.
This raises two points.
-Marc
December 15th, 2010 at 6:26 pm
I wonder if the store kiosks configuration were nationwide or if there was any targeting by region/zip.