Best Buy adapts to competition from online players like Amazon by improving customer service and positioning itself as an expert in TVs, computers and other electronics. This membership offer is the latest example of the company’s approach to winning customers, said Michael Baker, a retail analyst at Davidson & Co.
Best Buy is also looking for ways to add new revenue streams other than product sales. Membership is attractive because it can generate recurring fees from customers.
Best Buy currently has another, more limited membership program, Total Tech Support, which launches in 2018. The new membership program will replace Total Tech Support in the six countries where it launched, and Baker expects one day to completely replace the previous concept.
“You need to keep making these subscription offers more attractive to customers,” Baker said.
Best Buy started membership after a strong year in the pandemic. The retailer saw an increase in sales of items from laptops to kitchen appliances as more Americans worked and cooked at home. In the last quarter ending January 30, comparable sales or those in stores open for at least one year increased by 12.6% compared to the previous year.