Amazon, Best Buy Try Being Nicer To Customers

Written by Evan Schuman
December 21st, 2010

All predictions are pointing to a profitable holiday season, with holiday-season-to-holiday-season revenue increases slated to be in the double-digits. But is this also the season for treating customers a little nicer as an experiment? Best Buy killed its profitable restocking fee policy and Amazon offered free super-saver shipping later than in any other holiday season, sweetening the deal with free next-day shipments for a large percentage of its hottest camera and video products.

Best Buy said its decision was based on the position that the chain “continually listens to our customers.” (This is sort of like those strange recorded messages that ask consumers to take surveys after a call center call and then stress “the comments you give will have no impact on services offered.” How wonderfully and unexpectedly candid. It’s saying, “we’ll listen to you and then do whatever we had planned to do. Thanks for sharing.”) Given that Best Buy customers have been screaming about killing restocking fees for quite a few years, it makes us wonder what the chain suddenly heard this year that changed its executives’ mind.

Amazon’s move is interesting for a different reason. It’s a baby step—offering this option on just some products and then only for a few days once a year—but it’s inching toward the realization that removing the shipping costs (and much of the shipping delays) would make it so much easier for Amazon to corner quite a few markets. And no more so are those concerns dominant than in consumer electronics.

The most baffling part of the Amazon move is in the exceptions for its overnight shipping. After a few common sense exceptions (if you don’t make the purchase during the free shipping offer, you don’t get the free shipping; this applies only to Amazon products and not other retailers that sell through Amazon; it must be to a single address within the continental U.S.; and the always popular “void where prohibited”), the Amazon site tells consumers the next-day shipping “does not apply to orders placed with 1-Click.”

It’s excluding orders placed with 1-Click? Actually, no, it’s not. A spokesman for the E-Commerce giant said that 1-Click is not an exclusion and that someone apparently grabbed the wrong image or text from somewhere. (That 1-Click wording disappeared from the site a few hours later.)

At a big picture level, this more-customer-friendly approach certainly isn’t new. Some chains have always focused on making the buying experience easy and stress-free (think Costco and Nordstrom), while others have enforced strict rules to ward off fraudsters (think Wal-Mart and Best Buy).

Those consumer-friendly policies have a high cost—literally. The traditional wisdom has been that not all chains can afford the luxury of excessive niceness. Is mobile challenging all of that? When ordering becomes that easy, will shipping, restocking fees and harsh return policies—approaches that consumers have long resented—start to cost retailers a lot more than they’re supposedly saving?


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