Great Selling by Truth Telling: A Best Buy Tale

I was in Best Buy the other day.

The sales guy was excellent. He was open about what he knew and what he didn’t. He advised us to spend more, or to spend less, depending on what we wanted and needed in the several product lines we were exploring. He was candid. He spoke quickly and directly, in short, to-the-point sentences.

When we finished, I asked him, “You’re not on commission here, right?”

“No, not here. I’ve sold on commission before, though.”

“Which do you like better?” I asked.

“Oh, I prefer this. You can tell the truth.”

“You can tell the truth?”

“Yup. The other way, sometimes you’ve got to make the month, or bend it around for some other reason. It’s hard. Here you just tell the truth. It’s a lot easier.”

Just tell the truth–it’s a lot easier.

Let’s parse that: then evaluate it.

Why is it a lot easier?

1. There’s only one version of the truth—an infinity less to remember.
2. It’s easier to answer questions—it requires only short-term memory, not creative license.
3. It’s easier for people to tell you’re not lying.
4. People buy more from you if they feel you’re telling the truth.
5. People tell their friends; truth-telling is good marketing.

Of course, some people feel this is a sucker’s game. It’s sales right? The point isn’t to tell the truth, it’s to not get caught not telling the truth? To look like you’re telling the truth, not to actually tell it.

After all, we’re in business—right?

So let’s have a look at the numbers.

BBY Stock Chart

Here is a 5-year stock chart for Best Buy, tracked against the S&P500, and against Best Buy’s most obvious US competitor, Circuit City. (BBY is the one that ends at the top, by the way).

And sure, you can make charts look any way you want. I’m not trying to be an analyst here. I’m just saying the case is not only intuitive, but very plausibly empirical as well.

(By the way, Bear Stearns rated it underperform back in January. Goldman Sachs rates it a Buy.  Cheap shot? Maybe, but I’m just sayin’…)

Telling the truth is not stupid, wussy, or bad business. Far from it. It’s very good business. And for pretty obvious reasons.

And that’s the truth.

9 replies
  1. Kelly
    Kelly says:

    Charlie,

    I love what you wrote here about truth. It couldn’t be more necessary and relevant. I have to say, I was shocked you were writing it about Best Buy! You must have a very different store.

    I have heard they are trying extra hard lately, but you are the first one I’ve heard saying it’s paying off.

    I’ve been to a few in my time, and that is the place I go when I want to be left alone. As in, I can look at the merchandise for a half an hour with no fear of being helped, then leave without guilt and go purchase on amazon.

    For another look at Best Buy, check out what Maria Palma had to say a while back.

    Sincerity and transparency. It’s the big discussion lately. My feeling is that the effort to fake truthfulness as a strategy will weed out those who think it may be a smooth way to grow their business pretty quickly. So I hope what you experienced is sincere (and more than just one extraordinary employee); then maybe Best Buy is back on solid footing after all.

    Regards,

    Kelly

    Reply
  2. Ian Welsh
    Ian Welsh says:

    One of my favourite lines is as follows: "the right thing to do is almost always the right thing to do".

    By which I mean that the right thing morally is usually the right thing pragmatically.  People tend to think there must be a conflict, but most of the time there isn’t.

    Reply
  3. Charlie (Green)
    Charlie (Green) says:

    Kelly, that’s not my experience with Best Buy generally, but I don’t have enough data to say much beyond a few individual experiences.  At the very least, our different experiences point to how the concept of excellent service is very individual.

    I find Ian’s point provocative.  Even more broadly, if you don’t mind taking a very relativist view of things like ethics and norms (think structural functionalism), they tend to exist because at a broad social level over time–they work.  It is in society’s interest to have proscriptions against, to take an obvious example, murder. 

    In that same vein, it’s in society’s broad interest that people tell the truth, and we speak ill of them when they don’t.  The notion that business should be exempt from this idea is a peculiarly late 20th century perversion of great thinkers like Adam Smith (whose main book was on Morals, not economics).   The notion that naked self-interest to the point of lying is somehow magically transformed into a social good at the aggregate level is something he would have cringed at–in my humble opinion.

    Reply
  4. Kelly
    Kelly says:

    Ian, I love that line!

    Charlie, I agree.

    Excellent service is individual, but a culture of excellent service is top-down, and it’s going to come down to what the guy you met said: telling the truth.

    They say they want to make big changes, so your experience is the norm. It gets hard to spot truth from stock-propping blather at that corporate level. It will take time to tell whether they truly want to change the Customer Experience at Best Buy on more than just an individual level.

    I hope they are turning things around for real and not just as a p.r. promise. I love a good turnaround story.

    Reply
  5. George
    George says:

    I was surprised that this was about Best Buy, also.  I used to be a customer, but quit going there several years ago when they tried to defraud me.  I won’t go into the details, but the local store manager told me that only the corporate office could change things and the corporate office said they couldn’t override the local store manager.  I ended up calling the state’s attorney’s office and refuting the charge on my charge card.  But they sure lost my trust.

    In contrast, I had trouble with Circuit City a few months back.  My dealings with their customer service was very frustrating.  After I wrote them an angry letter, I got a call from an assistant to a vice-president.  They not only solved the problem, but gave me a small gift card for the several months of aggravation I had experienced.  No company is perfect, but I’m still a Circuit City customer.  They worked hard to earn back my trust.

    Reply
  6. Chris Barr
    Chris Barr says:

    I find your Best Buy experience to be interesting; but, misses some extremely important points. All of us have to get up in the morning… go to the bathroom… look at ourselves in the mirror. If you have not been truthful with yourself and others, you won’t be able to face yourself.

    I was very successfully commission salesperson for approximately 35 years. Regardless of how you are compensated, if you treat people as you would want to be treated, know your product’s strengths and weaknesses; and, know the same about your competition, you will be successful. I earned many a sale by truthfully explaining the advantages of my product, without having to talk down my competition; or, having to lie to the client.

    Too many people aren’t willing to do their homework [learning their product and the competition]. Thus, they find that they have to lie to people in order to gain a one-time sale. My way led to repeat sale after repeat sale. There is much more to the art of selling than just being able to talk with people.

    Please do not confuse most store “salespeople” with the true “salesman”. Most in-store personnel are merely “order takers”, which may be the reason they feel that a commission based compensation necessitates them to be less than truthful. A true “salesperson” is not intimidated by a straight commission compensation plan. In fact, I wouldn’t want to work any other way. A straight commission plan enables the pros to earn more money than any other compensation plan.

    In closing, the next time you enter a store, remember that these people are merely “order takers’. Please do not confuse them with the professional salesperson!! Say what you want; but, the old Fuller Brush and Britannica Encyclopedia salespeople were some of the best salespeople in the world. They worked hard, they worked smart, they knew the art of salesmanship, who continually studied and practiced to be the best they could be… they were professional salespeople. All of them worked a straight commission career.

    Reply
  7. Ian Welsh
    Ian Welsh says:

    I suspect it may have more to do with the luck of the draw and the individual salesperson than the store.  That said, having worked comission, I think it did warp my behaviour a bit.

    Reply
  8. Phil McGee
    Phil McGee says:

    Charlie,
    Commission, no commission, a liar is a liar.  I’ve been both a truther and a liar and my pay system didn’t make a wit of difference. 

    Also, commission or no commission most sales people are measured, rated and ultimately paid according to their achievements which are pretty easy to measure.

    Reply
  9. Charles H. Green
    Charles H. Green says:

    I want to thank Chris Barr and Phil McGee for articulating a very important point I was sloppy about.

    They are completely right in distinguishing a person’s truthfulness from their form of compensation.  After all, if one’s integrity has to depend on their method of compensation, it’s pretty shallow to begin with.  And as both point out, and I agree, you can do very well by truth telling regardless of how you get paid.

    Ian’s right from a point of view of social policy; these things have influences on social behavior, else we wouldn’t have legislation and professional proscriptions.  But that’s not the same issue as an individual acting from true customer focus, as Chris and Phil point out.

    Their point is relevant in several industries.  For example, the National Association of Personal Financial Planners makes a big deal out of being "fee-only," as opposed to other planners who get some of their income from commissions. 

    NAPFA never says so directly, but they imply that NAPFA planners are more ethical, less conflicted, more up-front, have less to hide, etc. because they do fees not commissions.  

    I think I know what Phil and Chris would say about that: if your ethics depend on your method of payment, they’re stretched pretty thin to begin with.  The issue in that industry is disclosure, not fee base.

    And kudos to Chris for a ringing endorsement of the professionalism of selling, in terms that are totally consistent with serving the customer.

    Reply

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