Sam's Club Adds Tech Support As Wal-Mart Ends Dell Program

By Karen Talley, Of DOW JONES NEWSWIRE

NEW YORK -(Dow Jones)- Wal-Mart Stores Inc.'s (WMT) Sam's Club warehouse division has added support services for consumer electronics, as parent company Wal-Mart considers its next step after ending its own pilot program with Dell Inc. (DELL).

Sam's Club said Wednesday it is making permanent a test effort it was running for the last year to provide free technical support for electronic products its customers buy and will also offer home delivery and installations for a fee.

The program is being offered in Sam's Club's 600 warehouse stores nationwide on all electronic merchandise, including Apple Inc.'s (AAPL) iPods, Dell personal computers and Sony Corp. (SNE) high-definition televisions. Sam's Club is using a third-party firm, which it declined to name, to provide the support services. Sam's Club is also requiring vendors to supply its service providers with information about their products so they can better assist customers.

Sam's Club is sharing what it learns through the program with Wal-Mart Stores' merchandising team, although, "No decision has been made about how [the program] might be applicable to Wal-Mart," said Sam's Club spokeswoman Susan Koehler.

Wal-Mart has been stepping up its consumer electronics business to add more brand names, staff and highlight the locations in its stores, making the revamped departments more user friendly. Right now, Wal-Mart does not offer delivery or installation for electronics products.

The company also, this summer, began quietly ending a pilot it started with Dell in July 2008 to market tech support services through kiosks at about a dozen Dallas-area Wal-Mart stores.

The companies "determined it was not the right solution for our business models and goals in this area," said Wal-Mart spokesman Melissa O'Brien.

"There are no new plans we have to share at this time" about what Wal-Mart's next step may be, O'Brien said.

The Sam's Club rollout may be a prelude to Wal-Mart launching similar services on a permanent basis, said Stacey Widlitz, retail analyst at Pali Research.

Many consumer electronics retailers have taken the path to offer greater value to their customers. Best Buy Inc. (BBY) is a pioneer in the area with its "Geek Squad."

The Sam’s Club announcement may be troubling for Best Buy, Widlitz said. "Much of Best Buy's competitive advantage has been in its level of customer service relative to its competitors."

With discounters such as Sam’s Club and potentially Wal-Mart "getting into the consumer electronics service game, I believe that the gap between Best Buy and its competitors may be beginning to close," Widlitz said.

Best Buy representatives weren't immediately available for comment.

Wal-Mart shares were up 4 cents at $51.04. Best Buy's were up 1.2% to $38.82.

-By Karen Talley, Dow Jones Newswires; 212-416-2196; karen.talley@dowjones.com

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