Customers wait outside a Best Buy store in downtown Toronto, Ontario on November 23, 2020 to collect their online orders.
Geoff Robbins | AFP | Getty Images
Best buy is testing a new annual membership program that offers perks like tech support, free shipping, and extended warranties for smartphones or other purchases.
The consumer electronics retailer said in a company blog post Wednesday that the program will be available in some stores in Iowa, Oklahoma, and eastern Pennsylvania. It will roll out to stores in Minnesota, North Carolina, and Tennessee later this month. It will be tested in around 60 branches by the end of the month.
The program, called Best Buy Beta, costs $ 199.99 per year, or $ 179.99 per year for customers using the retailer’s credit card.
Best Buy sales rose over the past year as consumers bought technology to work, go to school, and spend time at home the Covid pandemic. Sales on the Internet and in stores that have been open for at least 14 months increased 9.7% year over year in the last fiscal year ended January 30th. However, revenue growth declined sharply from 23% in the third quarter to 12.6% in the fourth quarter.
The retailer expects the pace of growth to continue to slowespecially after a year of unusually high sales. CFO Matt Bilunas said sales in the same store would range from a 2% decrease to a 1% increase. He said Best Buy expects more people to spend money on restaurants and travel.
With the membership program, Best Buy hopes to grow sales beyond the pandemic and attract more customer wallets. It follows the competitor’s game book including Amazon and Walmart. Walmart started its own program, Walmart +, last year with perks like unlimited grocery delivery and discounts on fuel. It costs $ 98 a year. Amazon Prime has gained more than 150 million paid members worldwide over the past 15 years with free, fast delivery and a huge library of TV shows and movies. Prime membership costs $ 119 per year.
Best Buy’s perks are tailored to the technology. Membership program customers receive unlimited technical support from the Geek Squad, a 24/7 concierge service, exclusive member prices for goods, and free installation of many devices and products. You also get a two year warranty on most purchases, including Apple Products like iPhones.
“As we seek to evolve our membership programs, the goal of Best Buy Beta is to create a membership experience that customers will love and to keep them comfortable throughout their relationship with Best Buy,” said Allison Peterson, Chief Customer Best Buy officer on the company’s website.