SOURCE: The American Consumer Institute

The American Consumer Institute

November 10, 2009 07:06 ET

American Consumer Institute Releases Study Finding No Difference in Consumer Electronics Prices Between Wal-Mart and Best Buy

Study Calls for Wal-Mart to Improve On-Shelf Labeling to Ensure Shoppers Can Make Educated Comparisons of Consumer Electronics

WASHINGTON, DC--(Marketwire - November 10, 2009) - Shoppers' perception that Wal-Mart is the lowest-priced retailer for consumer electronics goods is incorrect, according to a new study, released today, by the American Consumer Institute (ACI).

The study's findings are particularly significant considering that according to the Consumer Electronics Association, the average American household owns 23 consumer electronic products and has spent over $1,200 in the last twelve months. During this holiday season, 80% of consumers plan to buy consumer electronics for themselves or as a gift for others.

ACI also urges Wal-Mart to improve its shelf labeling on electronic products to help consumers make better-informed buying decisions.

The multi-part study included interviews of consumer electronics shoppers' preferences by the Research Network; comprehensive in-store and on-line price comparisons by TeleNomic Research and a comparison of HDTV prices at Wal-Mart and Best Buy conducted by Deutsche Bank Securities.

Among the findings of the study were:

--  For retail electronic goods, consumers believe that product quality,
    knowledgeable staff and in-store help are more important factors than
    retail price.
--  Shoppers rank Best Buy ahead of Wal-Mart in overall service, as well
    as in terms of higher product quality, more knowledgeable sales associates,
    ease in finding in-store assistance, wider electronics product selection
    and better post-sales support.
--  Consumers, particularly lower-income ones, believe that Wal-Mart
    offers lower prices for consumer electronics.
--  However, an analysis of a market basket of electronic products finds
    no significant difference -- less than one half of one percent -- between
    Wal-Mart's and Best Buy's consumer electronics products.
--  When the value of Best Buy's free home delivery, hookup and used
    product disposal for HD TV's are included in the market basket analysis,
    Best Buy's effective price is lower than Wal-Mart's price.

"Consumer electronic specifications can be very technical and complex. The survey shows that consumers want more information and in-store help," said Steve Pociask, president of the American Consumer Institute. "But some labels in Wal-Mart stores provide virtually no usable information, other than price, that would enable consumers to shop, compare and save.

"The lack of information on its labels may contribute to the false perception that Wal-Mart is always lower-priced," added Mr. Pociask. "We strongly recommend that Wal-Mart provide more complete on-shelf and on-line product information to its customers."

The conclusion of insignificant price differences from the market basket analysis conducted by Telenomic Research is supported by an August 2009 consumer retail research report by Deutsche Bank Securities that found Best Buy maintained lower monthly average prices than Wal-Mart for identical models of HDTVs over the previous 11 consecutive months.

The study also suggests that shoppers do their homework first, shop around to compare product prices, watch for weekly sales -- and consider delivery, installation and support costs before buying their consumer electronics.

A full copy of the report is available at

About the Research

Consumer survey of electronic shoppers by the Research Network in September 2009.

CE Industry Forecast provided to ACI by the Consumer Electronics Association, October 20, 2009.

Mike Baker and Adam Sindler "Best Buy: Trends Should Bottom This Quarter," Deutsche Bank, Global Markets Research, August 31, 2009, page 4.

Wal-Mart vs. Best Buy Pricing Study, September 2009, TeleNomic Research, which received an unrestricted research grant from Best Buy.

About The American Consumer Institute Center for Citizen Research

The American Consumer Institute Center for Citizen Research is a 501(c)(3) nonprofit educational and research institute. The Institute focuses on economic policy issues that affect society as a whole, and seeks to be a better and more reasoned voice for consumers, by using economic tools and principles to show that markets work best for the benefit for consumers. We are committed to the use of generally accepted quantitative, cost-benefit analyses of policy alternatives and their transparent application to assure that our methods can be fully and fairly evaluated on their own terms and by those who may disagree with our conclusions. We use economic analysis to empirically measure "consumer welfare," rather than relying on conjecture, opinion or political leaning to judge what benefits or harms consumers.

For more information about The American Consumer Institute, please visit us at