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Sam’s Club Expanding ‘Tech Expert’; Wal-Mart to Follow?

23 Sep, 2009 By: Erik Gruenwedel

Sam’s Club, a unit of Wal-Mart Stores, Sept. 23 said it would roll out nationwide a free technical support service covering a broad range of consumer electronics, including home theaters, HDTVs and Blu-ray players.

Dubbed “Sam’s Club Tech Expert,” the service launches Nov. 1 and will offer in-home installation and delivery services starting at $50 and basic installation packages starting at $89. Free delivery is available on some electronics merchandise offered online at samsclub.com.

The “Tech Expert” program, which includes video game hardware installation and music CD ripping, had been in tests at select store locations for the past year.

“We believe the new program and changes are in line with our other member services and allow us to continue to invest in offering high-quality, leading name brand electronics at superior values,” said Steve Dacus, SVP of electronics and technology at Bentonville, Ark.-based Sam’s Club.

Sam’s Club said it is also implementing a 90-day limit on returns of CE purchases — a move the company said store members supported in a recent survey.

Pali Capital analyst Stacey Widlitz said the rollout could cause concern for Best Buy Co.’s vaunted Geek Squad in-home service, which she said heretofore has underscored the No. 1 CE retailer’s customer service competitive advantage.

“With discounters such as Sam’s Club getting into the CE services game, we believe that the gap between Best Buy and its competitors may be beginning to close,” Widlitz wrote in a note.

Indeed, the analyst said she expected Wal-Mart to aggressively usher in a new CE customer service program to replace the recently shuttered Dell Technology Center test program.

Widlitz said the advent of a potential high-profile competitor to the Geek Squad could force Best Buy to increase promotional costs, which she said would “not bode well” for future operating margins.

Best Buy’s services unit, which includes the Geek Squad, posted a 3.7% decline in same-store revenue in the most recent quarter (ended Aug. 29) and represented 6% of Best Buy’s $8.2 billion in domestic quarterly revenue — down from 7% of $8.1 billion in revenue during the same period last year.


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