Virtual Sales, Marketing & Management Tips to Grow Your Business

It all started in a seemingly unrelated manner; we needed to refinish our 23 year old living room floor. Time, children, parties, and our West Highland white terrier had taken their toll on the poor old floor; it was worn and tired, ready for rejuvenation. As with any project like this, there always seems to be unexpected collateral damage, though in this case, it was a surprising issue, revolving around a six year old Denon receiver that did not support the new HDI video connection necessary for Blu-ray DVD player, a recent birthday gift from my family.

So what does the Denon receiver have to do with floor sanding and a big box electronics store? To sand said floors, everything had to be removed from the room, with at least 1 million wires promptly disconnected from my old Denon receiver, my new Blu-ray DVD player, speakers, cable box, etc. With the mountain of components piled high in a corner, it seemed like a serendipitous opportunity to upgrade to a current HDMI receiver. Exit stage right to Best Buy, which is only 2 miles from my house. I assumed that within a matter of minutes, I could purchase a new, high tech, HDMI compatible receiver with extra bells and whistles to power my entertainment system as soon as the floor refinishing was completed a couple of days later.

Though I’m an ardent fan of technology, I’m somewhat of an audiophile amateur, so I did a little research online prior to arriving at Best Buy. I subsequently knew enough to be a little dangerous, preferring 7.1 to 5.1 and 4 HDMI inputs as opposed to 3, though I could be readily convinced to buy more (or less) based upon the suggestions of seemingly competent store personnel. As I strolled past isles of DVDs, iPods, and DVD players all neatly stacked on their tidy shelves, I came upon the audio section. There were many receivers on display, candidly I had no idea which to select. Enter stage left someone I’ll refer to as Brian, a polite, professional and seemingly knowledgeable electronics salesperson. I liked Brian, he was patient, and answered questions succinctly, asked relevant questions about my current system and then, offered his suggestion as to which unit to purchase. “This Denon receiver is on sale for only $450, marked down from $599, and has all the features you want, it’s a great choice.” His logic was compelling and his style was consultative.  This was an impressive sales presentation resulting in a rapid close. I simply retorted, “Sold”, and followed Brian to the sales desk as he went back to pull the receiver from inventory. A couple of minutes later her returned, “Sorry, but we’re out of stock. I can call another store and you can pick it up there (the nearest store was about 25 minutes away), or ship it to your house.” Both of these were reasonable suggestions, but for me, and I assume for many others, retail means immediate purchase gratification. Undeterred, I said, “How about one of the other units we looked at?” Brian scanned the display units, but the only “close” option which was in stock, was an open box item that looked pretty beat up, was missing the setup microphone, and the manual. There were low end receivers available, but I was looking for better performance and they had already been dismissed as viable alternatives in my initial discussion with Brian. Uncomfortable with the open box item, I thanked Brian (who did a very good job), and walked back to my car to ponder other options. With Circuit City gone, and no other viable retail options available to me, I drove home.

A few minutes later I was back at my PC and searching the web for more information on receivers. There were several online merchants, including Amazon, offering the same Denon as Best Buy, in stock, for about $75 less (including shipping). Several websites however, recommended a Pioneer receiver, which was only $25 more but purportedly delivered better sound quality.  Having purchased from Amazon before, I clicked the button, dropped the item in my “cart” and 48 hours later it was on my doorstep, the day after my floor project was completed and just in time to hook it up for the Celtics game.

As of this writing, Amazon’s market cap is $53 Billion while Best Buy is $16 Billion.  Over the last five years, Amazon is up about 250%, whereas Best Buy has been flat. Let’s give credit where credit is due, Best Buy has outmaneuvered many competitors including Circuit City, it’s just in an unfair fight. Massive brick and mortar infrastructure acts like a boat anchor, drowning even the most able competitors in a flawed business model. Fleet footed virtual companies, with dramatically reduced overhead, rapid shipping, large pools of inventory (or the ability to drop ship from other sources) and good customer service, appear to be winning the day. In this anecdotal incident, where this motivated buyer wanted purchase, tried to purchase, and needed to purchase, walking away empty handed was more of an omen than a symptom. The world is embracing virtual business in many ways; big box electronics retailers merely represent an obvious shift.

For more on the virtual paradigm shift, read Your Virtual Success (Career Press), already available at Amazon, three weeks ahead of the big box book stores which are also carrying it: http://www.amazon.com/Your-Virtual-Success-Finding-Profitability/dp/1601631014