Oct 13, 2020

Walmart is taking part in a pilot program to test the viability of offering consumer electronics and technology services to its customers at a fraction of what similar services such as Best Buy’s Geek Squad cost.

The retailer is setting up kiosks — four Dallas-area locations and another in Springdale, AR — that will enable customers to sign up for in-home installation of computing devices, smart home products, televisions and WiFi. It will also offer repair services for damaged smartphones and other electronic devices.

Walmart is looking to roll out the service in 50 locations by the middle of next year, and shoppers in areas with the service will be able to access it online. The kiosks will be staffed by True Network Solutions, which is partnering with the retailer to provide the service.

“With the increasing pace that new electronic devices and categories are released, our customers have told us they need help navigating the tech world,” Darryl Spinks, senior director of Walmart Services, told The Dallas Morning News.

Should the pilot prove successful it may give the retailer a service alternative to Best Buy’s Geek Squad and Apple’s Genius Bar.  Best Buy generates five percent of its total revenues from paid subscriptions and repair services, according to a Talking Business & Politics report.

Walmart is taking a price-centric approach to its competitive program, offering prices as much as 50 percent below what is charged elsewhere. Screen replacements for iPhones at Best Buy cost $129.99; the price for Walmart’s customers will be $79.

An annual subscription to the service through Walmart, which includes a one-time device setup, 24/7 tech support, unlimited virus removal and lost data recovery, costs $89.99. Best Buy’s total tech support subscription runs $199.99 annually.

DISCUSSION QUESTIONS: Is there a compelling business need for Walmart’s tech repair service offering? What will the service’s lower-cost position relative to Best Buy, in particular, do for Walmart’s consumer electronics sales?

Braintrust

“Business model diversification is the growth engine of the future for retailers and Walmart exemplifies that trajectory.”

“The big challenge is for Walmart to create a distinct brand built more on competency than low cost.”

“In the markets where the pilot program is active, a lower price for installation and repair services should attract Walmart shoppers and increase electronics sales.”

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