For over a year now, Best Buy has been running a deal where you can get five dollars off many new DVD’s if you trade in a used DVD. And they’ve set up a section on their website where you can sell used DVD’s to them.
The thing is that I’ve never seen used DVD’s for sale at any Best Buy. So what are they doing with all these used DVD’s they’re accumulating?
I don’t know for sure, but my guess is that they are just recycling them. Instead of having a $5 off sale on DVDs, they do a $5 off for used DVDs. Maybe people have old DVDs sitting around that they don’t watch anymore and they’ve been meaning to get rid of them, and that would motivate people to go into Best Buy and shop, as opposed to just a $5 off sale that sounds nice but never gets the people to go in and shop.
Also, there might be a psychological thing, that people would feel like they have an extra $5 now and be willing to buy another DVD or CD or something other small thing at Best Buy. Compared to if the new DVD was just $5 off and they’d just buy the DVD and nothing else.
I don’t know what they would definitely be doing with the used DVDs, but it’s beside the point, since the main goal is just to get people shopping. They are probably making very little money however they get rid of the used DVDs, or maybe even losing money, but it’s worth it to increase purchases of new DVDs.
Best Buy is a middle man for the buyback program, the actual company the used DVDs (and more) go to is a separate company, Buybak.com. Buybak acts as a wholesale source for used DVD sellers (used DVD shops, flea market vendors, etc.), and offers instant inventory and order fulfillment for folks looking to sell on eBay, gohastings.com, Amazon and such.
The $5 Best Buy offers is often more than Buybak is actually paying BB for the products; in those situations, Best Buy is taking a sub-$5 hit on each trade-in as a means to get customers in the door, as Sam Lowry notes.
They’re building one of those solar-power farms, because they know the video-rental business is a dead end.