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Best Buy gearing up for nationwide iPad 2 promotion on April 17

post #1 of 46
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A leaked internal memo from Best Buy indicates that the big-box retailer plans to make a marketing push for the iPad 2 on Sunday, April 17, and will resume taking reserve orders for at least a week after the promotion.

After rumors suggested last week that Apple had "blacklisted" Best Buy from future iPad 2 shipments due to a sales dispute, Best Buy issued an official statement claiming that stores were holding non-reserved iPad 2 inventory for an upcoming promotion.

A corporate memo purportedly from Best Buy has outed details on the "upcoming promotion," which will reportedly take place on April 17, as noted by Engadget. According to the memo, "the iPad 2 will be featured on the front cover of the April 17 ad and because of this, the reserve order system will be turned back on on Sunday."

The ad will disclaim that there are "no rainchecks" on the iPad 2, although stores in Michigan and Ohio, which will have a minimum of three units, will offer Reserve Tickets in lieu of rainchecks.

As previously noted by Best Buy in last week's statement, reserve order fulfillment still takes top priority for any iPad 2 inventory that stores receive. After stores have sold through any additional inventory, they will begin taking reserve orders for the device.



"The reserve order system will be turned on for the entire week of the ad, possibly longer," the memo noted, adding that units should be held for customers for no longer than 48 hours.

The directive acknowledges that customer interest on Sunday will likely exceed available supply. "Corporate Support Teams know that many stores won't be in the optimal inventory situation or have available units to meet our customers' requests for this ad. It will be critical that stores have their current reservation(s) worked through and execute any new reservations effectively to take care of as many customers as possible."

Also of note, the memo states that Best Buy employees will be allowed to purchase the iPad 2.

Retail employees are discouraged from sending customers to other stores that show available inventory "since any inventory is most likely for reserves." Alternate store pick up options such as OMS and BestBuy.com will remain unavailable.

Best Buy was a launch partner for both the original iPad and the iPad 2. Last month, leaked photos, which showing that the first-generation iPad had been removed from the Best Buy inventory system on the eve of the iPad 2 unveiling, corroborated an exclusive report from AppleInsider that Apple would surprise with "near immediate availability" of the touchscreen tablet.

Apple has attracted crushing demand for the iPad 2, though supply has appeared to improve since the device's launch drew record lines in March. Estimated ship times for the iPad 2 on Apple's online store still stand at 2-3 weeks, down from the 4-5 week figure quoted throughout March.
post #2 of 46
Will Best Buy offer discounts? If not there is nothing special about the offer. Since people already are willing to line up at a store with inventory, what real incentive would Best Buy give? People can order iPads online at the Apple web site if there isn't any discount.

Maybe Best Buy is just doing this to draw in customers in the hope that they will buy other things while they're there and disappointed.
post #3 of 46
25 bucks off will boost sales by a lot. 50 bucks off will annihilate any competition iPad has. And since it has none there is a potential for an increadible quarter for apple. Playbook is going to have close to no sales as long as such promotion is in place (assuming they don't match)
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post #4 of 46
Best Buy rant - deleted. Should have said, "They couldn't care less and it shows."
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post #5 of 46
What incentive would Best Buy have to offer discounts on a product that will have 0% chance of NOT selling-out that very morning? Besides Apple has very strict pricing guidelines and the price points are locked. The best thing Best Buy could do is offer free gift cards but again they have no reason to.
post #6 of 46
Quote:
Originally Posted by sheff View Post

25 bucks off will boost sales by a lot. 50 bucks off will annihilate any competition iPad has.

That's silly. It makes zero sense to discount a product that's going to sell out, anyway.

They will sell every one they have in stock. So discounting will not boost sales by a single unit. They could cut the price in half and would not sell one additional unit (at least, not until production catches up with demand - which is not going to happen any time soon).

Think first, THEN type.
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post #7 of 46
Quote:
Originally Posted by jragosta View Post

That's silly. It makes zero sense to discount a product that's going to sell out, anyway.

They will sell every one they have in stock. So discounting will not boost sales by a single unit. They could cut the price in half and would not sell one additional unit (at least, not until production catches up with demand - which is not going to happen any time soon).

Think first, THEN type.

Correct. This is all about getting bodies in the door. If they have a bunch to sell, no waiting required, then they should get mobbed.

It's presence advertising.
post #8 of 46
Quote:
Originally Posted by sheff View Post

25 bucks off will boost sales by a lot. 50 bucks off will annihilate any competition iPad has. And since it has none there is a potential for an increadible quarter for apple. Playbook is going to have close to no sales as long as such promotion is in place (assuming they don't match)

How can a reduced price possibly boost sales of a product that Best Buy already can't get enough of to satisfy current demand at the full retail price.
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post #9 of 46
Quote:
Originally Posted by jragosta View Post

That's silly. It makes zero sense to discount a product that's going to sell out, anyway.

They will sell every one they have in stock. So discounting will not boost sales by a single unit. They could cut the price in half and would not sell one additional unit (at least, not until production catches up with demand - which is not going to happen any time soon).

Think first, THEN type.

I don't think it makes enough sense to even call it silly. A quick check on Craigslist and the asking price for iPads is about a $100 premium for all models. The only thing I can see is that there will be a small number of people who are wavering between an iPad2 and a Xoom or netbook or some other product. Reducing the price on an iPad $25 or $50 was suggested might sway those few buys. That's great for Apple, but doesn't do anything for Best Buy directly, except loose money. Indirectly they might have a higher profit margin on iPad accessories or extended warranties... but right now, I just don't get it.

Of course it could be INCREDIBLY GREAT publicity for Best Buy. That may be all they are after... just general marketing for the company name. Positioning. If that's the case, then it's not aimed at people who read these forums.
post #10 of 46
So the famous "promotion" is finally here. I can't wait! Are they going to drop iPads out of helicopters over shopping malls all across the country? "As God is my witness, I thought iPads could fly!"
post #11 of 46
Quote:
Originally Posted by Smallwheels View Post

Maybe Best Buy is just doing this to draw in customers in the hope that they will buy other things while they're there and disappointed.

THat is most likely the game. If they do offer any kind of discount it will probably be very small. More likely they will tag on a $25 iTunes gift card like they often do to the iPods during the holidays. Or perhaps a case or Zagg film or such.

But in the end they are hoping to get folks in the stores. And will do reserves to get them in twice

As for those saying it is silly to offer a discount. Actually it isn't. If they don't offer something folks won't consider taking the chance that what they want could be in stock. But if they can save $50 and have it now, that's a reason to try it rather than just for that online order they just placed with Apple
post #12 of 46
When I was a supervisor at Target we used to do this all the time. Two particular examples that popped into my mind are the Wii Fit and the iPod Mini ("OMG COLORS?! I TOTALLY WANT A PINK ONE!!1!"). We would internally call it a promotion and sit on inventory, but "promotion" really only meant that there would be a small picture of one in the weekly sales flyer that equated to "we do really sell these from time to time when we actually have them in stock." Both items were in short supply for an extended period of time, and withholding sales for weeks at a time was the only way to guarantee that we would have any at all and, by extension, avoid getting rapped for bait-and-switch.

Quote:
Originally Posted by Smallwheels View Post

Maybe Best Buy is just doing this to draw in customers in the hope that they will buy other things while they're there

I'm not sure about Best Buy, but at Target this was not the primary motivation. It's always bad business to disappoint your customers and the percentage of folks that stick around to do shopping so they haven't wasted a trip is very low. So why bother even advertising them at all if we really weren't counting on the foot traffic generated by the ads? The reason is that it helped perpetuate the image that we carried items that were current and desirable. This type of image-building counts for a lot in retail, especially if you have competitors that have a reputation for lower prices.
post #13 of 46
Quote:
Originally Posted by charlituna View Post

THat is most likely the game. If they do offer any kind of discount it will probably be very small. More likely they will tag on a $25 iTunes gift card like they often do to the iPods during the holidays. Or perhaps a case or Zagg film or such.

But in the end they are hoping to get folks in the stores. And will do reserves to get them in twice

As for those saying it is silly to offer a discount. Actually it isn't. If they don't offer something folks won't consider taking the chance that what they want could be in stock. But if they can save $50 and have it now, that's a reason to try it rather than just for that online order they just placed with Apple

Best Buy and Apple do not idscount Apple products. They are fair traided across the country except on Black Friday.

Your marketing expertise is suffering from delusion.
post #14 of 46
I have heard that some of the best buys are only selling you iPads if you agree to purchase THEIR extended warranty. You decide you don't want that, then no sale. They still sell out and this gives them more profit to deal with.
post #15 of 46
Good ******* luck to Best Buy to
(a) resolve disputes with Apple and more importantly
(b) get enough stock for "a big nationwide push"
post #16 of 46
Quote:
Originally Posted by bjojade View Post

I have heard that some of the best buys are only selling you iPads if you agree to purchase THEIR extended warranty. You decide you don't want that, then no sale. They still sell out and this gives them more profit to deal with.

I hope Apple sues them out of existence if this is the case. Or at least just stop them from selling Apple products for at least five years.

Time and time again we see that there is just no experience close to the Apple Store experience. It's not perfect and peachy 100% of the time at the official Apple Stores... but at least they avoid most of these common retail shenanigans. Retail is sometimes such a garbage lifestyle, career, and business, it's sad so much of modern life depends on it.
post #17 of 46
Quote:
Originally Posted by nvidia2008 View Post

I hope Apple sues them out of existence if this is the case. Or at least just stop them from selling Apple products for at least five years.

Time and time again we see that there is just no experience close to the Apple Store experience. It's not perfect and peachy 100% of the time at the official Apple Stores... but at least they avoid most of these common retail shenanigans. Retail is sometimes such a garbage lifestyle, career, and business, it's sad so much of modern life depends on it.

I bought my Black 64GB AT&T model on Tuesday. The salesman told me that reserve orders are held, but any additional inventory can be sold, even to employees!

I found it through the online tracker from a tip at MacRumors via Obamapacman.com. There's still availability showing in the greater NYC area. (Sorry about the rival site mention Phillip)
post #18 of 46
I hope the sales staff have been told that any one of them that starts mouthing off about how he or she doesn't approve of Apple's 'closed, walled garden' is fired.
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post #19 of 46
Quote:
Originally Posted by bjojade View Post

I have heard that some of the best buys are only selling you iPads if you agree to purchase THEIR extended warranty. You decide you don't want that, then no sale. They still sell out and this gives them more profit to deal with.

I don't see that as being possible. You walk up to a check out clerk with a product and hand over a credit card in Best Buy. I can't see how the check out clerk can say at that point you can't buy it when you say 'no thanks' to the extended warranty. Unless they are insisting the purchase takes place at the Apple booth within the store not the normal check out, that might be the case I guess.
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post #20 of 46
Quote:
Originally Posted by Mac-sochist View Post

"As God is my witness, I thought iPads could fly!"

iPad 2's CAN fly... but it is usually 'out the door!'

Get it... they're flying out the door... (drum rim shot)

"cricket, cricket"... Boy, tough crowd. \
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post #21 of 46
Quote:
Originally Posted by Rot'nApple View Post

iPad 2's CAN fly... but it is usually 'out the door!'

Get it... they're flying out the door... (drum rim shot)

"cricket, cricket"... Boy, tough crowd. \
/
/
/

*golf clap*
post #22 of 46
Quote:
Originally Posted by Smallwheels View Post

Will Best Buy offer discounts? If not there is nothing special about the offer. Since people already are willing to line up at a store with inventory, what real incentive would Best Buy give? People can order iPads online at the Apple web site if there isn't any discount.

Maybe Best Buy is just doing this to draw in customers in the hope that they will buy other things while they're there and disappointed.

Just opened the early edition of the Sunday NY Times - the Best Buy flyer says "starting at $499" - cover sold separately, so no special deals.

Interestingly, the Toys-R-Us flyer also touted iPad2 availability.
post #23 of 46
Quote:
Originally Posted by Mac-sochist View Post

"As God is my witness, I thought iPads could fly!"

One of the best from Mr. Nessman!
post #24 of 46
Quote:
Originally Posted by mentalward View Post

When I was a supervisor at Target we used to do this all the time. Two particular examples that popped into my mind are the Wii Fit and the iPod Mini ("OMG COLORS?! I TOTALLY WANT A PINK ONE!!1!"). We would internally call it a promotion and sit on inventory, but "promotion" really only meant that there would be a small picture of one in the weekly sales flyer that equated to "we do really sell these from time to time when we actually have them in stock." Both items were in short supply for an extended period of time, and withholding sales for weeks at a time was the only way to guarantee that we would have any at all and, by extension, avoid getting rapped for bait-and-switch.

This will likely work on a national scale, but in smaller communities the supply isn't nearly as constrained and this could hurt some stores. I went in to best buy looking for an iPad last week but they said they didn't have any. I went to Walmart and got the one I wanted.
post #25 of 46
All these Flash-less iPads (and iPhones) will severely impact Flash-dependent websites' views statistics. That will dent ad revenue. Google/Youtube e.a. won't like that.
post #26 of 46
Quote:
Originally Posted by balsy2001 View Post

This will likely work on a national scale, but in smaller communities the supply isn't nearly as constrained and this could hurt some stores. I went in to best buy looking for an iPad last week but they said they didn't have any. I went to Walmart and got the one I wanted.

Yup - I can't see how hold back on inventory works at all. If a customer doesn't buy from you he could go and get it from somewhere else. Then you've completely lost the sale. As iPads retail for $700 on average there isn't that much that sells at that price in the volume that iPads can command.
post #27 of 46
Best Buy charges $0.99 more than retail for Apple products.
Couple that with Apple charging only state sales tax (no local tax) on mail orders and you're much better off buying from Apple on line.
post #28 of 46
Quote:
Originally Posted by Rokcet Scientist View Post

All these Flash-less iPads (and iPhones) will severely impact Flash-dependent websites' views statistics. That will dent ad revenue. Google/Youtube e.a. won't like that.

YouTube doesnt need Flash. Nor do Google ads. Nor does video, though some sites are slower to open up than others. SOMEBODY wont like it though (And they wont like Android much better, where Flash support is trickling in... in name only, but not working at all well and with no signs of that changing.)
post #29 of 46
Quote:
Originally Posted by balsy2001 View Post

This will likely work on a national scale, but in smaller communities the supply isn't nearly as constrained and this could hurt some stores. I went in to best buy looking for an iPad last week but they said they didn't have any. I went to Walmart and got the one I wanted.

Quote:
Originally Posted by DogGone View Post

Yup - I can't see how hold back on inventory works at all. If a customer doesn't buy from you he could go and get it from somewhere else. Then you've completely lost the sale. As iPads retail for $700 on average there isn't that much that sells at that price in the volume that iPads can command.

Speaking as someone from a small community (we have a Best Buy here but it's scarcely larger that a typical mall shop) I can say that the downside of being sold out is a much smaller factor than you think. You assume that supplies are allocated equally across stores when this is not the case at all. Going back to the Wii Fit (the most recent example I've experienced personally...I haven't worked retail in a couple years), the bulk of the inventory was heavily allocated to major metropolitan stores. Our Target store here in Montana would be lucky to receive a single unit a week.

The truth is that an item in as much demand as the iPad is likely to be fairly constantly sold out across the board. The various stores will get their own shipments at different times and different amounts, and you clearly hit the Wal-Mart at the right time. There will be other times when Target or Best Buy will be the only store with them in stock. These are not lost sales, where you and a competitor both have items to sell and the customers choose the other guy to buy from. The retail chains WANT things like the iPad to be sold out. To them, the only "lost sales" are the units still sitting on the salesfloor.

One final thing I want to throw out there. The only thing that retail chains are interested in regarding Apple products is the "halo effect." You know how having an Apple product can make you feel cool and hip? It's pretty much the same thing for a store. I can say firsthand that iPods and other Apple products are sold effectively at-cost with almost no markup (I'm talking less than $2), so aside from the ride they get from the coattails of Apple's reputation, there is almost no financial incentive for them to sell iPads at all. The fact that they sell for $700 is irrelevant.
post #30 of 46
So BestBuy has changed the meaning of promotion from "I will give you something extra for your money's worth" to "I will let you buy what you want".

Only a few products ever commanded this level of demand.

BTW, I visited a BestBuy in Toronto, Canada and there was a long line waiting to try out the iPad. A RIM salesman was on the floor demonstrating the PlayBook. Poor guy, he had a tough job selling to me, even though I tried to be nice.
post #31 of 46
Quote:
Originally Posted by Rot'nApple View Post

iPad 2's CAN fly... but it is usually 'out the door!'

Get it... they're flying out the door... (drum rim shot)

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/
/
/

Don't quit your day job. If you have one.
post #32 of 46
Quote:
Originally Posted by digitalclips View Post

I don't see that as being possible. You walk up to a check out clerk with a product

Easy. They often don't have high price/demand items right on the floor for you to just grab. So you have to go to a clerk who is happy to check the stock computer. But first he's going to probe you about what else you want. And when you say no to the warranty 'oh so sorry but we are sold out'

I had a store in Los Angeles do that to me over a blu-ray I wanted to get. I shrugged and walked away, got on the site on my phone and ordered it for in store pick up at that location and suddenly they had it

It is unlikely that it is a company or even store policy though it might be a practice by some staff and overlooked unless the manager gets a complaint.
post #33 of 46
Quote:
Originally Posted by Mac-sochist View Post

So the famous "promotion" is finally here. I can't wait! Are they going to drop iPads out of helicopters over shopping malls all across the country? "As God is my witness, I thought iPads could fly!"

HIlarious. But iPads are definitely not turkeys!
post #34 of 46
Quote:
Originally Posted by charlituna View Post

Easy. They often don't have high price/demand items right on the floor for you to just grab. So you have to go to a clerk who is happy to check the stock computer. But first he's going to probe you about what else you want. And when you say no to the warranty 'oh so sorry but we are sold out'

I had a store in Los Angeles do that to me over a blu-ray I wanted to get. I shrugged and walked away, got on the site on my phone and ordered it for in store pick up at that location and suddenly they had it

It is unlikely that it is a company or even store policy though it might be a practice by some staff and overlooked unless the manager gets a complaint.

Yep, if you'd quoted my entire post I kind of alluded to that as the only way they could do this. Frankly pushing their own extended warranty over Apple's own should be a red flag to Apple when dealing with this chain of numb nuts.
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post #35 of 46
My local Best Buy had 8 in stock, with 20 people in line. 2 WiFi's and the rest 3Gs. And hour later the line was gone and there were still two 3Gs.
post #36 of 46
When all is said and done I think the entry level wi-fi version will garner 60% or more of the sales volume. 3G just makes no sense for most buyers IMO.
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post #37 of 46
Let me start by saying I would normally make an Apple purchase directly from Apple. In the case of the iPad 2 I thought I'd use Best Buy gift cards. What a mistake.

Remember the reports of Best Buy being blacklisted by Apple. Followed by statements (at least from Best Buy) stating that they have a wonderful relationship, yada, yada, yada. So with the upcoming promotion I decided to show up at my local Best Buy and basically say, "Ok, so where's my iPad? Weekly flyer all but guaranteed there would be at least a couple of each model available." Problem is they don't. But what really infuriates me is that according to the inventory manager they actually did receive five black 64 GB iPad 2's, only to have them yanked by Apple with zero explanation. When I asked him about the whole "blacklist" thing, he said it was ABSOLUTELY TRUE. So basically because Apple got their knickers in a bunch they f'd over a ton of loyal customers. If they are such control freaks and soooo worried about customer experience, why in the hell would they punish the end users? If there was some sort of manufacturing defect, just be honest and admit it. If Best Buy is acting unethically then deal with them behind closed doors. Don't jerk your customers around.

Up until this product release, I have enjoyed fantastic customer service and a great buying experience . . . when buying directly from Apple. In fact I'd say it's been better than great, it's been phenomenal (a model every company could learn from). But this nearly five week drama is getting really old, and has really taken the "magic" (to use an oft used Apple adjective) out of this purchase for me.
post #38 of 46
Quote:
Originally Posted by Cpsro View Post

Best Buy charges $0.99 more than retail for Apple products.
Couple that with Apple charging only state sales tax (no local tax) on mail orders and you're much better off buying from Apple on line.

Not sure what state you live in, but here for shipments to New York Apple (and other online merchants) charge the full sales tax -- including but the state and local taxes.
post #39 of 46
Quote:
Originally Posted by midnight weezie View Post

Let me start by saying I would normally make an Apple purchase directly from Apple. In the case of the iPad 2 I thought I'd use Best Buy gift cards. What a mistake.

Remember the reports of Best Buy being blacklisted by Apple. Followed by statements (at least from Best Buy) stating that they have a wonderful relationship, yada, yada, yada. So with the upcoming promotion I decided to show up at my local Best Buy and basically say, "Ok, so where's my iPad? Weekly flyer all but guaranteed there would be at least a couple of each model available." Problem is they don't. But what really infuriates me is that according to the inventory manager they actually did receive five black 64 GB iPad 2's, only to have them yanked by Apple with zero explanation. When I asked him about the whole "blacklist" thing, he said it was ABSOLUTELY TRUE. So basically because Apple got their knickers in a bunch they f'd over a ton of loyal customers. If they are such control freaks and soooo worried about customer experience, why in the hell would they punish the end users? If there was some sort of manufacturing defect, just be honest and admit it. If Best Buy is acting unethically then deal with them behind closed doors. Don't jerk your customers around.

Up until this product release, I have enjoyed fantastic customer service and a great buying experience . . . when buying directly from Apple. In fact I'd say it's been better than great, it's been phenomenal (a model every company could learn from). But this nearly five week drama is getting really old, and has really taken the "magic" (to use an oft used Apple adjective) out of this purchase for me.

This whole post strikes me as highly implausible. Why would Best Buy go ahead and run their flyer if Apple had pulled all their iPads? And the "blacklist" thing was supposed to have happened over a week ago, so it's not like they couldn't stop the presses.
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post #40 of 46
Quote:
Originally Posted by Smallwheels View Post

Will Best Buy offer discounts?

No ... nor there any freebees ... Actually Best Buy had to redistribute its iPad2 inventory throughout 1100 stores to better met pre-paid back orders. Today they re-opened their back order process in order to help customers get their products faster if possible. Thats it folks.

iPad2 is the hot selling product and the demand is very high as you all know. The Promotion is just having stock to sell. There are 18 models and it is tough to met so much variety in inventory management. Even though the White Model is nice (I have one ... only because I couldn't get black). In my mind of 40 years in sales, I would have gone the Ford route. You can have any color you want as long as it is black. Black color only would have enabled half the packaging differences ... most of the inventory differences... and black is really great in this instance.

That's it folks ... back to work or grumbling or what ever turns you on.
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