Posted: Wednesday 4th April 2007 2:54:40 PM
Written by: Simon Bell
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PC World

As a previous employee of PC World I learnt many of the trade and sales techniques used by the sales advisors (or salesmen). These techniques are used to make you buy more than you really need when you shop for your computer essentials. What I have written here is a guide for anyone to read. It may be of particular interest to potential customers of PC World wanting to know how to grab a bargain, but it will also give you an insight into what is going on before you even walk into the store and what the sales advisor has been trained to do.

PC World is part of the Dixons Store Group (DSG), and trade under DSG Retail Limited. DSG own Currys, PC World, Dixons, and the Link (but has now been sold on). You may notice that Currys and PC World will compete with each other in terms of their prices, this is so you (the customer) feel you are getting a better deal by shopping around (next door in many cases), despite PC World and Currys trading under the same company.

PC World can be very competitive in their computer base-unit and laptop prices. Special offers are frequently changing to showcase their dangerously low prices. But often these special offer computers will have sold out, and the only other models of similar specs are some-what over-priced! On most base and laptops, DSG are only making 1% margin (profit). But look at the number of customers who walk into PC World wanting to purchase for example; just a laptop, and leave with enough accessories and peripherals to power an office block.

Because base-units and laptops are only making DSG anywhere from £1-10 in profit this clearly isn’t enough to allow the company to grow and expand as much as it clearly has. So then take a look at what other items an average customer may get roped into purchasing:

So our average customer that just wanted the Special Offer £399 laptop that they saw advertised on TV ended up spending £315.36 on accessories which makes a grand total of: £714.36. In terms of profit; 1% of the laptop at £399 = £3.99 profit. Accessories (or attachments) carry around 90% margin. Using the above example where the customer purchased £315.36 worth of attachments, with a 90% margin that amounts to £283.82 profit for DSG. So PC World relies on the majority of its profits from attachments, basically anything that is not a computer!

The above example may seem ridiculous but using the sales techniques used by the sales advisors the average customer at PC World would buy much more than they originally intended to. I experienced this for myself having been trained as a sales advisor, luring customers into unnecessary purchases. But why did I do it? Targets.

The number one reason I resigned at PC World was my disbelief and personal disagreement (and to be honest disgust) at how the company was run and as such how DSG was so successful. Each employee must keep above set targets. These targets vary weekly depending on what the company’s most lucrative and profitable products and services are. But a consistent target was that 50% of all sales made by an individual sales advisor must included PC Performance (PCP). Put simply, if a sales advisor sells 100 computers in a week, 50 of these must be sold with PCP.

PC Performance (PCP).
Covers most electronic devices from games consoles to entertainment systems. The monthly price of PCP varies depending on the cost of the device you want to cover. PCP basically gives you 24/7 software telephone support, onsite repair for PCs, accidental damage repair etc. PCP does not include theft cover.

Because of the pressures placed on staff, customer’s experiences with sales advisors often find that they can be unnaturally friendly, very persuasive, or in some cases just rude. I have to admit that I have been all of the above at least once when I worked for DSG. Some days it can be a struggle to stay above target, and other days you can be on 100% PCP sales. But there are certain ways in which we were trained to ‘persuade’ the customer into taking out PCP.

If, in most cases, the customer could see no need for PCP (because lets be honest it is over priced and not suited to everyone) sales advisors would offer the customer 1 month free (saving £9.99) of PCP. If the customer still shows no interest the sales advisor will keep trying, normally up to 3months free PCP (saving £27.97) with the following explanation (which usually hooks the customer into taking PCP cover): Lets say the price of the basket is £699, which includes a laptop and a few accessories. The sales advisor will give the customer 3 months PCP free which will deduct £27.97 from the baskets total: £699 - £27.97 = £671.03. Now, the customer can cancel PCP as-soon as he or she walks out the door and still keeps that saving of almost £30. But this makes the sale look bad because the customer has cancelled the PCP almost instantly. So the sales advisor will ‘advise’ the customer to keep the PCP for at least ‘a few weeks’ because this is when most computer issues may occur. In which case just call the PCP local rate number, and the Tech Guys will help you out. What of course the sales advisor is hoping you will do is to forget to cancel PCP and keep the cover for a few years, and frankly, most customers do forget to cancel their PCP cover, and the £9.99 direct debit or credit card payments will continue to seep out of the customers pocket.

So if you do want to save almost £30 on a computer purchase from PC World, be very careful that you do remember to cancel the monthly PC Performance subscription!

An interesting story hit the newspapers in 2006. Consumer magazine Computing Which? Carried out an investigation on computer repair businesses. The magazines researchers deliberately ‘broke’ computers so they ceased to function: On half the computers a vital Windows start-up file was deleted so that windows would fair to… start-up. On the rest of the computers a wire was loosened connecting the hard drive, so no data could be accessed. The faulty computers were taken to independent repair businesses, and PC World stores. Repair costs at PC World varied between £69 and £350, involving repair work such as re-installing windows, or even ‘advising’ the customer to buy a new computer. Overall independent businesses gave a much more accurate diagnosis and repair costs were much lower. Read the full story here.
The above story was mentioned on a training day at PC World which I attended. We were told that if a customer commented on the Computing Which? story to just ‘advise’ the customer to take out PC Performance because computer repair costs are covered under PCP so they would not have to pay anything. That is what PC World call ‘training’!

Ultimately if you are thinking of shopping at PC World:

Above all; Believe it or not there are businesses out there that are actually knowledgeable when it comes to computers, and don’t just want your money. Just because PC World are the biggest, it doesn’t mean they’re the best.

Useful websites:
www.tradingstandards.gov.uk
www.pcworld.co.uk
http://www.out-law.com/page-5561 - What are you actually getting when you purchase from PC World?
http://www.channelregister.co.uk/2006/11/09/pcworld_fails_fixing_test/ - Fixing a PC at PC World?

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Stuart

http://www.stuarty.tv

I work for Currys and everything in your article is spot on! I'm about to leave under the exact same circumstances! Why should I fool a customer into "Whatever Happens" product support when 9 times out of 10 things wont go wrong!? Poor poor consumers... Big big bucks for DSG. And as for OUR pay.. hahah! minimum wage.

John Buttress

Really good bit of info there. Will heed it well and recommend my friends read it.

I bumped into a couple of friends there one day (can't remember what I'd gone to look for) who were in search of a decent TV card. They asked me for advice on what to get. I said from here, nothing. It was overpriced.

On an earlier occasion I returned a product because it was faulty - the card would detect in Windows but driver installation repeatedly failed. The guy I spoke to (a complete idiot) initially refused a refund because I'd opened the driver CD packet and they were concerned about supposed copyright violation. I told him the copyright was not being violated because what was on the CD was also freely available on the Internet. Besides my basic consumer rights were being violated (Sale of Goods Act) and he swiftly issued a refund to avoid getting more of an earful from me or his manager. Needless to say I left the store muttering the W word on my way out ...

Simon

Fantastic post! I completely agree with your view of the company. Ive just resigned from pcw due to a disagreement with management on pc performance. My main issue with pcw is that explaining the pcp "proposition", but refusing to hassel/pressure the customer into a purchase when they say no is not a good enough excuse for not getting a strike, even if you have done the old "but what if this happens" routine. less than a 50% pcp rate for two months running equals a rollocking/job on the line threat. Also, customers frequently complain that there are never sales advisors in sight when needed and i know why, in stores in our cluster this is because they hide! or tie themselves up with customers explaining routers. If an advisor has an ok early half of a week and sells a reasonable £££ total at a 50% strike why would they risk selling more and dropping below the magical 50% "bollocking" barrier. After this disasterous peak season for PCW pound notes wise, maybe the pcw heirarchy should take this into consideraton and reduce the coverplan pressure on staff.

Daniel

www.google.co.uk

I work at pc world and most of the above is a load of crap. Mainly talking about pcp, yes we are told that we should persuade to sell pcp and its not always useless, I had a customer that had alot of repairs needed to be done and he lost all his data and he saved £150 because it was all covered in his pcp from health checks and data recovery and he didnt even have it for more than a year, so pcp isnt useless, its whether the customer feels they need it. Also your selling techniques stated does not apply to every store. You probably worked at Enfield or somewhere that always want to win in kpi's as such and get taught to not leave a sale without any attatchments, where as the store I work in doesnt stress it as much but recommended it to customers as it can be a money saver and very helpful. so for any readers of this comment or the artical, its not all true

name

LOL, that's amazing : ) It amuses me when customers come in and say "so are you an expect on computers", i can't help but feel sorry for them as i send them over to a sales assistant (i'm sales, but i prefer to avoid selling, i'm too honest) who has no idea about computers. I'd much rather be in technical. Anyway, everything here is bang on, although your pricing is abit off. Laptops we were told when we started only have about £5 profit on, done abit of research and digging, apparently it's actually around a minimum of 25/30, some of the high end going upto 60ish. Not that bad really. Oh and the new idea of pc world is to go into computing rather than computers. Basicly we sell the solution not just the product, aka attachments, services, contracts... The new big one is connects, we do broadband contracts with 3 different land line providers and 3 different 3g providers... it's about 70 margin on each that goes through. Not left my name as i still work there, for now.

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