Help Me, Commissioned Salesperson, You’re My Only Hope
by Dave Shumway
I read through an article on CNET yesterday that got me fired up about something I’ve had on my mind for the last three years - the unfortunate, yet inevitable, demise of Circuit City.
About three summers ago, I worked there part time as a TV/Home Theater salesperson and strange as it might sound, I absolutely loved it. Obviously I enjoyed being around the latest and greatest consumer electronics products, but I also got a lot of satisfaction from sharing what I knew with my customers and helping them pick out something that really rocked.
But alas, as both you and I can well attest, this level of customer service is not typical fare inside most big-box retailers these days. And the teenagers masquerading as technology experts leave a lot to be desired.
In years past, the stores incentivized their employees to deliver exceptional customer service by offering sizable commissions on sales, which often led to quite comfortable salaries and great employee discounts.
In this era of shrinking profit margins, however, commissions have become a thing of the past (as all Best Buy employees seem conditioned to report), and we are left to our own devices…or to the recommendations of Timmy, the high school junior.
What these retailers seemingly fail to understand, though, is that the one remaining competitive advantage they may yet have - the one key factor of differentiation between themselves and the countless online stores offering the exact same products for less money - IS CUSTOMER SERVICE.
And as a result of their negligence, most people (myself included) are more inclined to visit a big-box store, play around with a product for a while, and then purchase it on Amazon at a significant discount.
My direct challenge to Circuit City, then, is to bring back the days of commissioned sales (at least for specific departments with higher margins like TV/Home Theater) and see if things don’t get a little better.
Because at $4.14 a share, they could hardly get worse.
5 Comments 
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April 2nd, 2008 at 9:04 am
Not that I disagree, but why do you think Best Buy is doing so well in comparison (considering it’s same level of customer service)? In other words, I’m not sure customer service is the answer to Circuit City’s problems if its main competitor is doing fine without it… But like you said, Circuit City’s gotta try something to stand out.
I’m all for customer service. In fact, last summer I did buy a new TV (from Best Buy) and was very close to making it an online purchase. The only thing that stopped me is that I did find one rep who actually knew what he was doing.
April 2nd, 2008 at 9:56 am
I’ve read a lot of articles that cite Best Buy’s store locations and in-store aesthetics as a key differentiator, but it’s really hard to know for sure.
On the customer service front, even though the salespeople at Best Buy are fundamentally no different than those at Circuit City, corporate is at least SELLING them as qualified technical advisers (i.e., Geek Squad).
Granted, it’s almost 100% marketing, but my feeling is that it goes a long way to attracting the uninitiated.
April 2nd, 2008 at 11:24 am
I feel your pain Dave. The loss of the commissioned sales person is a tragedy of the modern marketplace. Many people instantly think of the stereotypical used car salesmen when discussing commission based sales. People seem to forget that the idea behind sales is all in the customer service - by providing outstanding service to clients, they will return and do business again and again, a very symbiotic business relationship.
A lot of industries still have commissioned sales people, but it seems the direct to consumer salesperson population is rapidly diminishing. Let’s hope that changes.
April 2nd, 2008 at 11:50 am
Ah, the powers of marketing…
I couldn’t agree more on “in-store aesthetics.” I wasn’t sure if there was something specific about the color red that made it look inherently dirty. But Best Buy’s blue does seem cleaner and more inviting for whatever reason.
April 2nd, 2008 at 11:51 am
I do think the layout of the stores in Best Buy is usually “better” and apparently that is enough to differentiate them. Why is it that every company thinks that they need to act like the Walmart/Southwest Airlines (low price, low quality/service) of their industry. As if that is the only successful business model in existence. Part of the reason I buy so much stuff from Amazon.com is because the service is so bad at brick-and-mortar retailers. User reviews, and other online information more than surpass the lowly high school kid trying to “help” me make a multi-thousand dollar purchase.
Here is my prediction: Circuit City will go under, and a few years afterwards some new store will open up that has really good service, and slightly higher prices. Kind of like how Target has gone kind of upscale vs Walmart.