How Best Buy Picks Its Windows 8 Tablets (and Why Its Stores Have So Few of Them)

Walk around the PC section of a Best Buy right now, and it won't look drastically different than it did before the launch of Windows 8. That may change over the next six to nine months.

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Adam Hunger / Reuters

Walk around the PC section of a Best Buy right now, and it won’t look drastically different than it did before the launch of Windows 8.

Sure, all the laptops are now running Microsoft‘s new operating system. A few of them will have touch screens, and Lenovo’s IdeaPad Yoga convertible will sit on an endcap. But for the most part, the store’s shelves are still lined with the same old laptop designs we’ve been seeing for years, not the new categories of laptop-tablet hybrids and convertibles that Windows 8 has ushered in.

That may change over the next six to nine months, as the nation’s largest electronics chain carries more devices and creates new sections for them, according to Jason Bonfig, Best Buy’s vice president of merchant computing. I recently spoke with Bonfig about why so many interesting Windows 8 tablets and hybrids are absent from the retailer’s stores right now, and he offered a couple of key reasons.

One of them is that PC makers haven’t been able to deliver their tablets and hybrids in time for Windows 8’s launch due to issues with manufacturing. Many Windows 8 tablets use touchscreens larger than 10 inches, which has been the standard for Android tablets from companies like Samsung, Asus and Acer. Production is still ramping up for the larger screens, Bonfig said, and while the manufacturing process for 10-inch panels has been refined over several years, the process for larger panels is still more likely to produce defective units. The mechanical aspect of hybrid designs is also new, Bonfig said, so manufacturers are still trying to improve quality standards there as well.

“The launch date in the October timeframe for Windows 8 was very limited,” Bonfig said, “and we needed to place our bets on a handful of exclusive products.”

(A couple of reports have also claimed that Intel‘s Clover Trail-based Atom chips were delayed in the lead-up to Windows 8, but Intel insists that it’s not to blame for the current bottleneck.)

Supply issues aren’t the only reason for Best Buy’s small selection. Bonfig said the retailer simply decided to pass over some Windows 8 hybrids–those with detachable touch screens–because they didn’t seem like a good value for shoppers.

Best Buy uses what it calls a “Value Equation” to figure out how much potential products are worth to customers. Drawing on past sales data, the company assigns perceived value to individual features such as processing power, screen size and memory. If the total perceived value exceeds the actual price–in other words, if it offers bang for the buck–the product has a good chance of landing in stores.

Hybrids and convertibles get a boost in the Value Equation as well, but it’s not always enough to justify their asking prices. This is especially true for hybrid Windows 8 machines with detachable screens and weaker specs than comparably priced laptops.

“We felt the customer would either make a choice to buy a less-expensive tablet, or they would make a choice to buy a more expensive Ultrabook or convertible, and they weren’t interested in some of the performance and value associated with a few of those products,” Bonfig said.

Bonfig wouldn’t name any specific products that Best Buy turned down, but he noted that for same $800 price as some Windows 8 hybrids, the store already sells an HP Envy 4 Ultrabook with an Intel Core i5 processor and a touch screen. (Again, he wouldn’t name names, but most hybrids that don’t use Intel Core processors come with weaker but more power-efficient Atom chips instead.)

Bonfig isn’t sure that customers would want to sacrifice performance just to detach their touchscreens. For the moment, Best Buy seems most interested in convertible Windows 8 devices like Lenovo’s Yoga, because they offer the same performance as high-end laptops. So far, Bonfig says Yoga sales have exceeded expectations to the point that Best Buy might have to adjust its Value Equation for convertible devices.

Best Buy does plan to sell a few more Windows 8 convertibles and possibly some hybrids in the December-January timeframe, and over time, the store’s computer section will start to transform. Over the next six to nine months, Bonfig envisions new sections of its computing department emerging–one for convertibles, and another for hybrids with detachable screens.

Why separate the two categories? Bonfig thinks convertibles will stick closer to laptops in terms of performance, while not all hybrids with detachable screens will be as powerful.

“People will start to say ‘I have a convertible,’ as opposed to ‘I have a laptop,'” he said. “I think that language will start to catch on over time with the consumer.”

7 comments
cnoge
cnoge

yeah, I'm waiting for the right convertible laptop. Obviously, the specs would be slightly lower than a traditional laptop, but i'm willing to pay the same price for the detachability. I don't want a laptop and a tablet in addition to my desktop. I guess I won't get it at BB. Since they seemed to have gotten it wrong. I agree with all the other people who commented, and I'm curious how 4Tiles likes his/her Envy X2 compared to Surface? Does the 11inch screen feel too big?

4Tiles
4Tiles like.author.displayName 1 Like

This isn't an idle threat to Best Buy -- in the past 2 months I have purchased 4 hybrid Windows PC's from their retail competitors (HP Envy X2, Acer W510, Microsoft Surface, and Dell XPS 12). I checked the BB site repeatedly for hybrid PCs, but they had nothing to sell me, so I shopped at other retailers like Microsoft, Amazon, Dell, and HP. Foolish decisions like these will put Best Buy out of business.

The transformer hybrid design is a clear value proposition and a major innovation in the world of computers. It combines the best functionality of an ultrabook with a tablet and doubles the battery life. Best Buy simply doesn't want to sell you one device when they would rather sell you both a tablet and a laptop. Consumers are not stupid and there are other shops in town.

skyledavisbooks
skyledavisbooks like.author.displayName 1 Like

The logic here seems slightly flawed to me, like someone is looking at traditional buying practices (performance over form) and not considering that practices might change as new form factors become available.

Also, it's not taking into account the "sale boosting" effect that Windows tablets could have for touch screen laptops. I think there will certainly be a number of people that ultimately opt for a touchscreen laptop, but that number could increase if they first play with a tablet. I can imagine someone considering a tablet, seeing the Windows 8 tablets, playing with it, and then saying, "You know, a touch screen ultrabook might be the way to go for me! The best of both worlds!" They use the tablet, want the keyboard, and then go with the touch screen laptop. 

And then those that want Windows 8 tablets can buy them too. Availability creates demand. I mean, I was just in a Best Buy today. I saw two guys check out the (WAY overpriced) ASUS VivoTab RT, which is the only Windows tablet there. They seemed to like it but don't want to pay $600 bucks for RT (stupid pricing move, ASUS). They were walking out the store before I stopped them and started up a conversation. I told them about the Acer Iconia W510 (which you can get for $399), and they seemed really, sincerely interested. If that tablet had been in the store, they might have been walking out with it. As it is, the Microsoft Store will likely be getting their money, either for the Acer or for a Surface Pro.

bodzi1
bodzi1 like.author.displayName 1 Like

'there are more p.c users since windows xp launched so you'll expect sales to be  more'

......how logical is that? In a saturated market? You expect more sales..... who hired U?

BrentonKlassen
BrentonKlassen like.author.displayName like.author.displayName 2 Like

I would buy a convertible with a detachable screen!  C'mon Best Buy, give us some tablets!