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Thursday, December 01, 2005

Best Buy's dirty tricks latest in Xbox 360 rollout mess

I won't buy top-of-the-line new tech right out the gate for one good reason: the stuff is rarely anywhere near 100% reliable. Better to wait a year or two and let everyone else "beta test" it so the wrinkles get worked out. Well, that reason and because it'll cost a lot less if you wait for it too. Besides, we got an Xbox last year for Christmas, and I haven't yet run out of thrills with that trusty black box. Our Xbox isn't going to be moving over for a successor for a long time to come.

But I can't disparage those that do go gunning for the newest tech first. Seeing the pics of Bill Gates handing out the first Xbox 360 to a customer last week, I couldn't help but smile at seeing how giddy that game player looked to have his grubby lil' paws on one of the coveted systems. That kind of enthusiasm has been dampered in the week since though, first by reports that a lot of Xbox 360 systems have been crashing (seems to have something to do with the power supply overheating, so maybe that's somethinge readily fixable). Then came reports of 360s selling in the thousands of dollars on eBay - I saw one system going for $10,000 - because of the severe shortage of the system (but the good news is that more Xbox 360s are on the way so you may have a good chance yet of landing one for Christmas). Now comes this: word that several Best Buy stores wouldn't let anyone buy an Xbox 360 without first forking over money for extra hardware and accessories... like, a lot of money. From the Inquirer:

BEST BUY HAS ADMITTED some of its employees stepped over the mark when it launched the Xbox 360.
People who queued up in the Pacific Northwest lined up for hours in the cold to get one, clutching adverts promising list price, got a rude surprise.

Most of the people who queued up went away empty handed, because the advertised list price was not what they actually had in stock.

Best Buy would not sell them for the advertised price, but only with a bundle that just about doubled the cost. Games, controllers, cables, and other high margin knick-knacks so if you didn't pay $800 you couldn't get an Xbox 360...

An internal Best Buy memorandum seen by the INQUIRER and sent on Tuesday 11/15/2005 at 8:02am to several mailing lists at Best Buy, mostly managers in the Pacific Northwest, instructed stores on what was to be done.

The mail was sent a week before the launch date, and before the ads hit the press.

The memo contained five 'quick notes' and a shorter note at the end.

"We will be selling our units in packages," the memo said. "Each store should hold back three to four units of each model for those customers who put up an argument about being able to only buy the unit. Everything else will be sold in bundles. This keeps us in alignment with everyone's expectations."

Sales managers, the memo continued, would be in charge of the 360 launch and stores should use the "very best" sales people for the launch. It said that stores' future allocations depended on attachment sales "so you need to get it right or you will pay for it in December when new allocations of product are distributed". Best Buy was advertising a nine AM opening time on the 22nd and stores had to stick to that time. Best Buy had such low quantities that it needed to be careful with the advertising. The memo said that if stores opened early and sold all their units before that time, it could be in trouble for false advertising.

Sales people were told to sell up around the Xbox 360 using the "halo effect". Customers wanting 360s would also need HD TVs, and surround systems. It concluded: "Folks, it's like milk and cookies"...

Y'know, part of the fun in trying to find something like an Xbox 360 is the hunt itself. And when you find one there should be a sense of accomplishment... but only when everything has been fair and equitable across the board. Best Buy was exceedingly dishonest in following this policy. They ruined the fun for a lot of people as a result. I don't know if I'll ever buy an Xbox 360 but after hearing about this I can assure you: it won't come from Best Buy.