Welcome to Decathlon, where the atmosphere is more sports ground than retail store. On any given day, teenagers are seen shooting hoops at the free-of-charge basketball court, playing ping-pong on the store’s tables and even cycling around the parking lot. Some bring their mothers to take pictures of all the sporting action.
But this is exactly what the French sporting goods chain hoped would happen. Decathlon wants to make its own Chinese consumer fortune by turning sports goods shopping into a major retail experience.
The company – owned by Auchan, which also has a big stake in supermarket chain RT-Mart (see WiC65) – now operates 23 Decathlon stores in China, a market it entered in 2003. The goal is to open as many as 1,000 stores on the mainland in the next two decades.
To get there, Decathalon says it does not want to rely on advertising or celebrity endorsements. Instead, the company told CBN Weekly that the shopping experience should speak for itself.
“Experiencing brings people closer to sports and to our sports goods. And their experience also brings in their family members, friends and colleagues. That is much more effective than advertising,” says Tom Meng, head of the sports-good chain in China.
Meng hopes that people who go to his stores primarily to play will end up becoming paying customers. It’s not wholly unrealistic. When Walmart and the French hypermarket chain Carrefour first entered China in the 1990s, many customers flocked to the new stores just to look and touch. First-timer excitement may now have diminished, but millions have got used to supermarket shopping.
IKEA has also attracted plenty of enthusiasts to its showrooms, even if some are keener on living the Swedish dream than buying into it. There are media reports of some store visitors taking naps in the flatpack beds or sharing out picnics across the pinewood tables.
Back at Decathalon, some visitors are being persuaded to pay up. “I play basketball with my friends at Decathlon every Saturday afternoon because it’s near my home,” Cheng Xi, a 25 year-old IT engineer in Beijing, told the China Daily. “I also go inside to check the new goods and buy useful things for my picnic trips.”
Decathlon has also focused on grassroots promotion, sponsoring sports events in residential neighbourhoods near its outlets. Most of the activities are targeted at young children. Another tactic is to introduce more novel sports like rollerblading and rock-climbing. But when it comes to merchandising, the company primarily caters to local tastes. Table tennis, badminton, tennis and golf get a lot of coverage. Gym gear less so.
Price is another selling point. The company’s MYSIZE swimming goggles are sold at Rmb49 ($7.22) a pair, much cheaper than European or American brands sold in China. Many of its backpacks cost as little as Rmb59.
“Our products are not specially designed for the rich. We’re trying to make them affordable for those who make as little as Rmb600-700 a month, and to keep doing so for the next decade,” says Meng, who says he expects most of his customers to visit his shop by bicycle rather than by Porsche.
The “experience area” strategy does come at a cost. The basketball courts and ping-pong tables eat up space: Decathlon’s newest store in Shanghai, also its biggest in China, takes up 5,000 square metres over two floors.
The need for space has a drawback. In the richer coastal cities it has meant that many stores have had to be located away from the busiest shopping areas, where rents are naturally highest. That’s why Meng is now focused on opening new stores in second-and third-tier cities – like Changsha and Zhengzhou – where rents are lower and Decathlon can better marry prime locations with big stores.
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