Best Buy (NASDAQ: BBY) recently made the announcement that it will come out with a new annual membership program throughout the holidays, and will also unleash a perk that will encourage individuals to discover items that are tough finds.
Totaltech, the new Best Buy program that is in the process of being implemented, will cost around $199.99 per year. Those who partake in the program will receive limitless, 24/7 technical support, exclusive member deals on various items, product protection, and many other rewards.
This particular benefit program will take place as COVID-19 continues to create difficulties in global supply chains. The pandemic has caused temporary closures of factories and ports, which in turn has led to a lack in semiconductor chips in cars, laptops, and other such technologies.
In creating this membership program, Best Buy is striving to compete with other services, such as Amazon (NASDAQ: AMZN) and Walmart (NYSE: WMT). Peter Keith, retail analyst of Piper Sandler, stated this past week in a research note that the coming opening of Totaltech could be "a potential game-changer" for Best Buy and its stock.
Keith added that the program is "one of the most intriguing initiatives" for Best Buy in over five years. He believes that Best Buy will bring in another three million members in addition to the three million who already belong to the membership program that is slowly being eliminated. Keith also stated in the research note that he anticipates Best Buy to expand the membership from between 6 million to 10 million members with time.
Best Buy's new membership program, Totaltech, will surely offer benefits and rewards that are unmatched. Although Best Buy is competing with other companies such as Amazon and Wal-Mart, it seems to be holding its own as a place of business. If it continues to do so, then even more customers will be attracted to its membership program as well as its retail chain as a whole.