Amazon.com has lost what may have been its greatest competitive advantage over Best Buy: pricing.
According to a series of price checks conducted by retail analyst David Magee and his team at SunTrust Robinson Humphrey, the purchase price of a 50-item basket of accessories and larger-ticket products amassed at both retailers was “essentially at parity,” he reported.
This follows a “gradual tightening” of the price spread that the researchers had seen in the past, a Barrons blogger relayed.
If anything, Magee observed, a level playing field on price could prove a win for Best Buy, which can then unleash such in-store advantages as better-trained sales personnel, branded vendor shops, and the ability to test and easily return products, he said.
The pricing report follows Best Buy’s better-than-expected Q2 sales and earnings results, which were another feather in the cap of chief exec Hubert Joly and his Renew Blue turnaround strategy.
Not to detract from Joly’s accomplishments – remember, critics were writing off Best Buy a scant three years ago – but Magee & Co. also attribute Best Buy’s success in part to an improving macro environment, citing a stronger housing market, more affordable UHD TVs, and the growing popularity of wearables.