Best Buy Holding out on Xbox 360 Sales

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BUST Buy...

I heard a rumor that Best Buy would be getting a shipment of new Xbox 360s on the 6th, but not one of the Best Buys I talked with could confirm this. Was Micro$oft holding out to generate buzz about the product? Apparently Best Buy is stockpiling Xbox 360s until they can sell a bunch of them at once…

Taken from a leaked Best Buy internal document, which you can download here.

Hold All Xbox 360s for Dec. 18 Ad
The next Xbox 360 shipment arrives in stores between Dec. 11 and 16. All unites (not just the minimum 20 listed in ad) need to be held for Sun., Dec 18. Why?

  • This will help alleviate some of the problems encountered at launch
  • Many stores sold all units on launch day and didnt’ have enough to cover the ad.
  • Customers won’t be confues – Dec. 18 is the day Xbox 360 will be available, as stated in the ad, not any earlier or on different dates at different stores.
  • Additional problems to avoid
    The launch of Xbox 360 was a success. However, there were many things that happened and need to be avoided with all future shipments.

  • Don’t place sold orders.Product allocations are based on the sell through attach ratio from the previous product, not order generated. Placing sold orders will lead to customer dissapoints because you might not get enough units to fulfill all orders. If you already did this, you may need to call customers once you know your allocation and ask them to make a different selection or provide a refund.
  • Don’t hide Xbox 360 inventory in RSS. Doing do is a falsifiation of records and will be dealt with as such.
  • Don’t create or force hard bundles. Making it conditional for customers to buy additional product in order to get the hardware (hard bundles) isn’t Customer Centric – we sell based on a customers’ lifestyle needs and not to enhance our own scorecards.
  • Don’t hold product for select customers or employees. We understand the Viewpoint concerns. However, in tight inventory situations this can’t happen. Also, customer buying the Complete Solution don’t have priority over customers buying just the system.
  • Don’t create a waiting listSome stores have created a waiting list for customers. This will be extremely hard to manage and may cause many customer dissapoints.

Here are some things you can do to be successful with the Xbox 360 event on Dec. 18.

  • Give customers choices. Our future allocations are based on the total volume of accessories and software to the hardware we sell (non-transactional). Get everything to the floor and put the choice in our customers’ hands. Whether they buy the Complete Solution today or tomorrow, we need a customer for life.
  • Present all gaming systems. Xbox 360 and PSPS will only be 20 percent of holiday sales in gaming. The majority will consist of PS2, Nintendo (SP, DS, CUB) and Xbox (first generation). If there isn’t enough inventory of Xbox 360, offer another format. (Man stores don’t have PSP on the floor.)
  • Follow the Corporate provided playbook. An updated version will be posted Dec. 7, just in time for your Thursday Leadership Meeting. Following the plan will help us avoid negative Media coverage and the legal problems experienced at launch.
  • Dec 18. ad allocations. When ad allocation for stores become available, they’ll be provided to your DPPM. Stay tuned for details about when they’ll (be) available.
  • Contact PR with News Media issues. Because of the controversy surrounding the Xbox 360 launch, there may be increased news media presence in your stores. If local organizations or media outlets contact you about Xbox 360-related issues, forwad them to Best Buy Public Relations : Jay Musolf at (612) 291-6124, Paula Baldwin at (612) 291-6126 or PR Emergency Pager at (612) 538-6698. This is an exception to the holidy open-door news media policy in place through Jan 2.

Xbox 360 Launch Day Success
While there were issues with the Xbox 360 launch that can’t happen again with our next ad, the launch was a great success. Here are some of the highlights:

  • The Company saw a launch day hardware basket of more than $137 – double our traditional basket.
  • 207 stores exceed the $150 basket goal.
  • This was the largest comp week since week 3 of June.
  • Best Buy participated in the launch day event with Microsoft in Los Angeles.
  • Bill Gates attended the midnight opening in Bellebvue, WA, along with Brad Anderson.
Alan is a web architect, stand-up comedian, and your friendly neighborhood English Nazi. You can stalk him on the Interwebs via Google+, Facebook and follow his ass on Twitter @ocmodshop.

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