Sony Incentives to Gamestop Employees...

[Mize]

Here's a point.

A couple folks here want store employees to be unbiased customer consultants.

Unfortunately that's decidedly not what they're paid to do. They're paid to sell as much as possible at the highest possible margin, period.

So for those who don't like this just start a "console consultants" business where people pay you or your employees for unbiased consultations.

Nice idea on paper but you're competing with thousands of web sites providing the same service for free.

 

[expletive]

Unfortunately you just described a common practice known as "selling."
One sells what they're paid to sell. If I work for a Kia dealership Kia's are the best, etc.

Hence the age old saying "buyer beware"

Youre missing an important point and thats that in a store that sells multiple brands the selling is more about getting you to buy "something" then getting you to buy "this one particular thing even if i have to lie about it".

If i walk into a kia dealer i EXPECT that they are going to try and convince me to buy a kia because thats all they sell, BUT they still try and sell me the RIGHT kia. If they dont do their job in this respect, i'm less likely to buy from them again. However, when i have bought cars at one of these huge 'automall' type places that sell multiple brands, they have always asked me i'm looking for and what i need it for first, then showed me cars that fit my needs.

When someone who is relying on advice walks into a gamestop, the expectation is that they are getting unbiased assistance. In my opinion, it behooves Gamestop to have their employees be as impartial as possible. If youre running a brick and mortar store one of the supposed "benefits" is the 'helpful and knowledgeable sales staff". Why theyre putting their sales staff in a position where they cant be helpful or impartial is somewhat puzzling. Is it really worth flushing one of their competitive advantages over Amazon.com down the toilet?

Unfortunately that's decidedly not what they're paid to do. They're paid to sell as much as possible at the highest possible margin, period.

That's not always true. The retailer's job is to position the products from a pricing and 'value-add' (return policy, best selection, etc) standpoint to drive the most sales. A LOT of times the salesperson's job is to simply guide the consumer throughthe decision making process. In a lot of companies thats what they want from their salespeople. Thats why Circuit City stopped with a commission-based compensation structure. The employees in gamestop are not on commission, and even though they do the nonsense 'pre-order and strategy guide' upsell at the register, i'm sure if you asked a divisional manager hed tell you thats their role.

 

[Mize]

Dealerships carry multiple lines - have to in order to stay in business. The incentives to salespeople vary by brand and model. Same as ever.

The salesperson's goal is to maximize their own income.

Besides, at these places your talking (stereotyping here) to some of the dumbest people on the planet - why would anyone rely on their advice? It's like having a circuit city employee help you with estate planning.

 

[Mize]

When someone who is relying on advice walks into a gamestop, the expectation is that they are getting unbiased assistance.

Anyone who walks into any sales situation as the prospect with such expectations should rush to Best Buy or Circuit City and fill out an application ASAP.

After that just head over to the auto dealership and let them tell you what you need too.

 

[expletive]

Anyone who walks into any sales situation as the prospect with such expectations should rush to Best Buy or Circuit City and fill out an application ASAP.

After that just head over to the auto dealership and let them tell you what you need too.

Do you honestly think that any relevant % of the population is on forums discussion the pros and cons of the stuff in gamestop? Go stand in one for an hour so and look at the adult clientele that goes in there. Then tell me if they aren't relying on the salesperson for some or all of their needs. I'm in my mid-30s with kids, these are the people I 'hang out' with now and trust me, theyre all lost when it comes to this stuff. If they dont call me for advice theyre recounting a story where "the salesperson said blah blah blah so i went with this one". THAT'S the reality.

 

[Mize]

Do you honestly think that any relevant % of the population is on forums discussion the pros and cons of the stuff in gamestop? Go stand in one for an hour so and look at the adult clientele that goes in there. Then tell me if they aren't relying on the salesperson for some or all of their needs. I'm in my mid-30s with kids, these are the people I 'hang out' with now and trust me, theyre all lost when it comes to this stuff. If they dont call me for advice theyre recounting a story where "the salesperson said blah blah blah so i went with this one". THAT'S the reality.

The fact that they are uninformed in their purchase process does not put the burden of such education on the "other side" of the sale.

These same people probably walk in with a full "Edmunds.com" report before buying a car and probably read Consumer Reports before buying a refridgerator. If they don't then shame on them.

Do you really think that Lowes is going to junk a known poor-reliability appliance or let customers know it has been panned in Consumer Reports?

That is NOT their job. The buyer must do their own research.

Your idealistic notions are simply that.

 

[expletive]

The fact that they are uninformed in their purchase process does not put the burden of such education on the "other side" of the sale.

These same people probably walk in with a full "Edmunds.com" report before buying a car and probably read Consumer Reports before buying a refridgerator. If they don't then shame on them.

Do you really think that Lowes is going to junk a known poor-reliability appliance or let customers know it has been panned in Consumer Reports?

That is NOT their job. The buyer must do their own research.

Your idealistic notions are simply that.

You are confusing a subset of reality with 'sound business practices'.

A key component of any successful business is repeat customers. Good salespeople (and good companies) will do right by the customer, and also be empowered by the organization to do so. Lowes doesnt have a whole lot to gain by pushing an appliance they know will get returned or reflect poorly on their brand. Maybe youve never shopped for an appliance but the salespeople there DO often talk about reliability and make recommendations based on it. This is not some pie-in-the-sky ideology, its how some of the most successful companies in the world do business - customer first. You're underestimating the importance that companies will place on the integrity of their brand, and what consumers place on it.

Go look at a list of the top run companies and youll find they all have a strong focus on employee and customer satsifaction. I'm sorry that you're satsified with snake-oil salesman amd not demanding more from the places you shop, but i'm not. Does it really impact me? Not so much because I am an educated consumer. However, I do like the convenience the store offers and I want to see it stick around, rather than go out of business.

I think, if gamestop continues down this road, their already tarnished employee reputation will sink to new depths, and will be a relevant factor in its failure.

 

[Mize]

Lowes has a HUGE interest in selling sub-par appliances - it's called inventory. You don't sell it you lose money, period. Lowes can't return stock to GE or Maytag or whomever just because Consumer Reports gives it a bad review!

Your utopian approach to the sales process is neato, but not reality. I'm not happy with snake oil at all - that's why I educate myself and become my own best ally in the sales process.

As for "top companies" - baloney! Dell gets high marks but has consistently used "low bidder" components. Honda gets high marks but has one of the sleaziest dealer networks for new car sales. It's never about the reality it's about the perception of your company and the best snake oil salespeople are never "found out" because they're simply just that good.

Build a better mousetrap and the world will beat a path to your door? Nah. Sell a cheapo and convince people its the best is what (sadly) works.

 

[nelg]

Word games are fun? Their employers represent the suppliers - duh! Then they hire employees to do this job. If it's not the retailer's employees job to "sell you" then whose job is it?

It is not a word game. It is a recognition of the relationships at hand. A sound business values its relationship with its customers over all others. Look at the success of Walmart. When they extract lower costs from suppliers they pass that on to consumers. They don't give employees direct incentives to sell higher margin products. It seems to have paid off for them.

From Gamestop's perspective, I wonder why they would participate with this. Having a third party compensate your employee's does nothing for the bottom line. The company would be better served by selling the console with the highest attach rate.

 

[expletive]

Youre looking at the Lowe's example at a specific point in time but it becomes a more strategic equation for them. Decisions are made constantly on which brands to carry and at which pricepoints. The 'we have too much inventory or X right now' is not about corporate culture or how they expect their employees to act. What gamestop is doing here is knowingly putting their salesforce in a position to put themselves before the customer.

The other 2 examples you gave don't particularly resonate (with me anyway) because for Dell, lowest bidder doesnt always equal lowest quality. Their reliability will ultimately be judged on the ACTUAL reliability, not on the fact that they took the best bid for gigabit ethernet chips. (anecdotally, from my experience, Dell's corporate support is completely top notch.) It could very well be lowest bidder on a specific part which has minimum reliability qualities.

And Honda, i don't know how you objectively measure 'sleaziest salepeople around' but their cars, are consistently among the most reliable and that's why the get 'high marks'.

Perception is important but over time, the cream tends to rise to the top and youll see that play out as companies sometimes cyclically exchange places in the "top whatever".

 

[tha_con]

So my post has been completely ignored? Wow. Awesome.

I guess he doesn't really want to hear a voice of reason, he only wants to hear agreement or nothing at all.

 

[nelg]

Lowes has a HUGE interest in selling sub-par appliances - it's called inventory. You don't sell it you lose money, period. Lowes can't return stock to GE or Maytag or whomever just because Consumer Reports gives it a bad review!

They also have a huge interest in not perpetuating the sale of substandard merchandise, as it reflects on them.

 

[patsu]

Perception is important but over time, the cream tends to rise to the top and youll see that play out as companies sometimes cyclically exchange places in the "top whatever".

It's a difficult argument. Apple had to open their own stores to make sure sales people pay attention to their products. I guess Windows' dominance and price point (translates to better deal flow), coupled with insufficient knowledge about Apple products encouraged the sale people to focus solely on pushing PC.

In general (Whether it's for PS3, TV, or a toaster), channel programs like this simply provide incentives for sales people to be more effective. We can highlight the bad apples, but there are good sales people too. i.e., As part of this exercise, more sales people -- good and bad -- will likely look at PS3 closely to understand its salient points, instead of spewing nonsense. I don't see what's wrong with this.

Sales-oriented companies sometimes do introduce individual incentives. Each sales person generally has his/her own way to sell, with or without the incentives. We as consumers may or may not agree with their methods, but I don't believe the incentive is strong enough (or unjust) to make good sales people gone wild.

 

[rbushner]

Mize, I have my products in retail, those establishments don't represent me, they sell my products, there is a big difference. Alot of the large retail chains extract more money from the manufacturers than the customers. Who do you think pays for the newspaper ads, endcaps and rebates?

Allowing a manufacturer to give kickbacks is a conflict of interest, especially when you advertise your knowledgable sales associates. I admit it is the way alot of the large retail chains do business, but it is NOT the only way, because businesses operated much differently 20 years ago. When people start bringing up car salesmen as a 'normal' example, you know ethics are pretty much toast.

Fair treatment of customers and employees is a good thing. It creates customer and employee loyalty.

 

[crazygambit]

Seriously, who cares? Why should you care companies are giving incentives to teenagers to sell you their crap? Teenagers with like 10 minutes of training that aren't qualified to speak with authority about anything anyway. The most they can offer is their opinion, which you should disregard anyway. Worst case scenario you end up buying an entertaintment system that wasn't the best fit for your needs (that you can take back anyway) boo hoo.

What you should REALLY worry about is that pharmaceutical companies do the exact same thing with doctors (and those are real incentives, not consoles and games crap). The only difference is that a doctor has several years of training and specific knowledge that the average person simply can't match. So when they prescribe you medicine (usualy the most expensive one, instead of the generic that does the same) that might not even be the best fit for you, but the one they have the incentive to prescribe that's close enough, you can't simply disregard their opinion. Even if you somehow find out later you got screwed, you can't change the prescription without another doctors appointment. I'd say that is seriously evil, incentives for retail people to sell your product? Can't say I care too much.

 

[Xalion]

I think I have seen this hinted at, but I just wanted to state it again in my own way.

The main arguing point against this type of tactic is that it is "bad" for the consumer. I disagree. This type of sales incetive does not have to be bad for the consumer. For instance, selling more PS3s is not bad for those who own PS3s. Those same consumers often purchase games from stores like Gamestop. Selling another PS3 increases the userbase and gives manufacturers more reasons to make games. So Gamestop could be said to be doing a service to all their customers that own PS3s by pushing the system.

That is a stretched example - but there are other more concrete benefits. First, this type of incentive actually motivates sales representatives to learn about the other consoles. While the accusation that they "lie" to sell consoles is entertaining, most sales people I know don't bother to lie. They research to find the good qualities and emphasize those. If it is a product they are not interested in selling, they often have a bare minimum of knowledge required to answer basic questions. So customers often end up better informed about a product the person has an incentive to sell than one they don't.

Anotehr benefit of such an arrangement is that it stops the spreading of false information. I don't know about you, but it has been my experience that many employees at stores like this repeat what they have heard. Durring the time Sony was not running the promotion, I heard such things as "The PS3 is losing 50% of its units to overheating" or "They are pulling out of the market this summer" from gamestop employees. When I asked about it, they were all well intentioned but had not done more than listen to customers comming in for their information. If this type of promotion can stop this type of information, it is well worth it.

In the end, it is the sales person himself that determines whether any given business practice is "bad" or "good" from the consumer. It is not company policy. I have sales people I trust a lot. I will ask them questions. I have others I avoid like the plague. Many work at the same stores and are influenced by the same policy. It just is not correct to blame a store for implementing a good business policy because a sales person "might" use it as a stepping stone for bad consumer practice. The sales people who do those things will find reasons to do them anyway.

 

[nelg]

The main arguing point against this type of tactic is that it is "bad" for the consumer. I disagree. This type of sales incetive does not have to be bad for the consumer. For instance, selling more PS3s is not bad for those who own PS3s. Those same consumers often purchase games from stores like Gamestop. Selling another PS3 increases the userbase and gives manufacturers more reasons to make games. So Gamestop could be said to be doing a service to all their customers that own PS3s by pushing the system.

You are forgetting that the influence that such an incentive is geared towards is not towards those who already own a PS3 but someone considering buying a console.

That is a stretched example - but there are other more concrete benefits. First, this type of incentive actually motivates sales representatives to learn about the other consoles. While the accusation that they "lie" to sell consoles is entertaining, most sales people I know don't bother to lie. They research to find the good qualities and emphasize those. If it is a product they are not interested in selling, they often have a bare minimum of knowledge required to answer basic questions. So customers often end up better informed about a product the person has an incentive to sell than one they don't.

In the end, it is the sales person himself that determines whether any given business practice is "bad" or "good" from the consumer. It is not company policy. I have sales people I trust a lot. I will ask them questions. I have others I avoid like the plague. Many work at the same stores and are influenced by the same policy. It just is not correct to blame a store for implementing a good business policy because a sales person "might" use it as a stepping stone for bad consumer practice. The sales people who do those things will find reasons to do them anyway.

No. It is the consumer whom decides what is good or bad for themselves. What you are suggesting is like your fathers Oncologist saying he is not going to treat you fathers cancer so you can get your inheritance faster.

 

[Xalion]

You are forgetting that the influence that such an incentive is geared towards is not towards those who already own a PS3 but someone considering buying a console.

Actually, the incentive is not geared towards someone buying the console, but those who are selling the console.

I was pointing out that there is a benifit to those who already own the console if another gets sold. Hence the person selling the console is helping those who already own them. If the person selling the console sells games to people who own PS3s - that means he is helping his customers.

The argument that it hurts the consumer requires that the store selling the console has no other customers who own the console.

No. It is the consumer whom decides what is good or bad for themselves. What you are suggesting is like your fathers Oncologist saying he is not going to treat you fathers cancer so you can get your inheritance faster.

This has nothing to do with what I said. As a matter of fact it is so far from what I said I have trouble understanding how you got there.

Quick example:

Consumer A walks into a store wanting to buy a console.

Sales Person 1 decides that to get a reward he is going to lie, cheat, swindle, and do everything possible to sell a particular system to the customer.

Sales Person 2 knows a lot about a particular system because of an incentive. He passes that information on to the consumer who then chooses to buy the system as the best to meet his needs.

Now, who decided what was good or bad for the consumer? In both cases, the consumer got the same system. In both cases, the consumer was affected by the promotion. So which is good or bad?

In one case, the consumer left without an understanding of what he was buying. That was "Bad" for the consumer in the sense that you mean. He will probably get frustrated as he discovers what he bought is not what he thought it was. In the other, the consumer left educated about what he was buying. He will get exactly what he was expecting and feel good about his purchase.

The key here - who decided which experience the customer had? The sales person - not the customer.

An example with a doctor would be as follows.

A doctor goes to a drug lunch (drug lunches are when a large drug company purchases lunch for medical professionals in return for those professionals attending a short seminar on their drug).

Docter A decides that to get more drug lunches, he is going to push the drug the company sells at all costs and begins to perscribe it more than the generic.

Doctor B learns that the generics he has been perscribing can vary up to 20% the given strength of the name brand. He begins to perscribe the name brand more often for people who are likely to need the entire dose.

In both cases the doctors increase the number of perscriptions given. In both cases, the patient sees the same result. However, in the second case patients actually benefit from it. In the first, they may or may not benefit from it.

Once again, the sales person will decide whether he acts honestly with the promotion or whether he acts dishonestly - not the consumer. The sales person decides whether or not the consumer will benefit from the promotion - not vice versa. If your argument is that the consumer is hurt by dishonest business practices, then the ONLY person who can be responsible is the sales person. No one else in the world is capable of making that person act dishonestly.

 

[expletive]

Actually, the incentive is not geared towards someone buying the console, but those who are selling the console.

I was pointing out that there is a benifit to those who already own the console if another gets sold. Hence the person selling the console is helping those who already own them. If the person selling the console sells games to people who own PS3s - that means he is helping his customers.

The argument that it hurts the consumer requires that the store selling the console has no other customers who own the console.

Not that i think its a particularly compelling point but by that logic, it subsequently hurts owners of other consoles. What about Wii and 360 owners? Screw those guys? (which, incidentally, is a vast majority of next (current?) gen console owners now)


Clearly, at the end of the day, the salesperson decides how they will act. That's not the point. The point is that this introduces unnecessary incentive for those that have the propensity to put the customer LAST with misinformation, to do exactly that.

 

[Shifty Geezer]

Quick example:
...
Now, who decided what was good or bad for the consumer? In both cases, the consumer got the same system.

That's all well and good as long as both further the same end. The problem lies in the 'influenced' opinion being non-ideal with the customer's wants.

eg. A customer goes into a game shop wanting a console to play HD games and doesn't care for online.

Sales Person 1 tells them PS3 is the console they want because it has a zillion features and is the most powerful and has BRD with 100 GB storage and has a HDD and motion controls and is the future and...yadayada...and is great value and such. Sales Person A says this because he is paid a bribe by Sony to do it, or because he's a fanboy and hates MS, or some other bias. The customer spends $700 on a PS3 with a couple of games.

Sales Person 2 is unbiased and tells them PS3 has a lot of functionality but has a price-tag to match. XB360 is well known for its online capabilities, but you don't need to go online. The HDD model is the ebst value for money, but if the customer doesn't care for online content or media functions, the Core will suit them. The customer then decides from the options available which will suit them and their budget, and opts for the XB360 Core with memory card, spending $350 on a Core with a couple of games.

The difference with the latter is the customer having the choice from the information available. The ends don't justify the means. You just get lucky if your choice you try to imprint on a customer happens to fit them, but ultimately they should be making informed decisions. It could be the customer is happy with their purchase of a PS3 because they never learn that XB360 could have served their purposes for less money. Or maybe they come to use BRD playback. But it ought to be their choice to make. Of course, the chances of getting unbaised and well informed opinions in any store are limited. It's normally daft to rely on salespersons suggestions, whether they're in incentive schemes or not.