by Ed Stack
* * *
Among our not-so-secret weapons throughout this almost unimaginable growth was Bill Colombo. My old college buddy was terrific at execution, at putting our plans into motion and seeing them through to completion. I oversaw our merchandising strategy, what we actually chose to put in our stores—I’d always taken a strong personal hand in that—and our skills dovetailed so well that, with a financially disciplined approach and an expanding and competitive team, we were able to keep up with the company’s growth. At the pace at which we were expanding, and with the territories we had left to penetrate, we projected that we’d someday have eight hundred or even nine hundred locations.
But Bill’s brother fell ill with leukemia while in his fifties and was given a 30 percent chance of recovery. That got Bill thinking. Life is short. He thought he might wake up one day and find himself facing similar odds. He told me he wanted to retire, and in February 2008, he stepped down as president.
His successor, Joe Schmidt, had been with the company for eighteen years, most recently serving as our chief operating officer. He was smart, capable, and visionary, and had been actively involved in building the culture that had brought us success. I was pleased to have him, and he served in the role for five years, from 2009 to 2014.
Bill didn’t leave outright, however. Dick’s had outgrown a succession of leased headquarters in Pittsburgh’s western suburbs, and we now sought to custom-build a Store Support Center, as we called it, that would accommodate our leadership team, the thousands-strong force that oversaw the details of our operation, and our budding e-commerce efforts. I asked Bill to head up the project. We wanted a true home for the company, a place that our teammates were eager to be.
And holy smokes, did we ever get it: a campus of five connected buildings totaling 670,000 square feet, with soaring lobbies and atriums, a full-sized store mockup, and an auditorium seating about five hundred. Our team has, within steps of their desks, a full-service food court and a sit-down restaurant, indoor basketball and racquetball courts, an indoor running track, and a state-of-the-art health club. Outside are tennis courts, a soccer pitch, softball and baseball diamonds, and a hiking trail. The whole campus is certified green.
Five stories tall, topped with a sloping “victory wing” that juts from the roof over the main entrance, the Store Support Center occupies a wooded site in Coraopolis, beside Pittsburgh International Airport. A long drive winds through forest before the complex erupts into view, and let me tell you, that first view of the place never fails to excite me. We took up residence in 2010.
Still, Bill wasn’t finished. We had need of a marketing head late that year, and I asked him to fill in through Christmas. He was two years past ready to retire, but he agreed to do it while we searched for a new marketing boss. We found one in Lauren Hobart.
Lauren grew up in the New York suburbs, graduated from the University of Pennsylvania in 1990, and spent five years in commercial banking before returning to school for her MBA at Stanford. From there she joined Pepsi, where she worked in the company’s finance group for four years, then switched to marketing. Then, after ten years in marketing roles at Pepsi, she decided it was time to leave.
As luck would have it, I’d met a former boss and mentor of hers who caught wind that we were looking for a chief marketing officer. So Lauren came to us and impressed us at once with her smarts, energy, and creativity. She joined Dick’s in February 2011, and was destined to rise to the company’s presidency a few years later.
Bill finally retired on his anniversary date with Dick’s, after twenty-three years with the company. Even then, we didn’t let him shake loose completely: he remained vice chairman of our board of directors. He remains on the board today.
* * *
Whenever we had the chance, Donna and I got away to Florida. I’d inherited my dad’s love for the place and bought a house on the Atlantic coast, not far from where he’d spent so much time. My stepmom, Donna, lived nearby, and my siblings spent a lot of time in Florida, too.
My mom did the same—winters in Tequesta, summers in Binghamton—and I saw quite a bit of her in Florida over the years. For most of them, she remained the same demanding, me-first personality I’d known in childhood. But in 2005 she fell ill and learned that she had cancer. It started in her gallbladder and spread to her lungs, then to her brain.
This terrible news came with a bleak prognosis, but it sparked a wondrous transformation. After a lifetime of being needy and undemonstrative, my mom became warm and loving. Whereas before she’d been self-absorbed, now she became giving and compassionate; her mind-set shifted to “How can I help? What can I do?” And in place of the bitterness that had long consumed her, she was accepting, even happy. It’s one of those terrible ironies that an effective death sentence brought her the most satisfying years of her life and the happiest time we kids spent with her, but so it was: she struggled against her cancer with dignity, humility, and concern for all around her. She became a lovely human being. In the end, she got it right.
At some point she was given the choice of brain surgery and the possibility of a longer life—but with pretty good odds of dying on the table—or, alternatively, living out her few remaining days in relative comfort. She chose the surgery, and though the doctors bought her time, she never really recovered from the procedure. She was lucid but so compromised physically that she never left her bed. She might have become even more loving after that.
One thing that never changed: like everyone who’d spent years at 16 Ardsley Road, she was a Yankees fan. I remember walking into her room in the fall of 2009, during the major-league playoffs, and asking, “Mom, how are you doing?”
“Those Yankees,” she said, sighing. “I was so disgusted last night with those boys.”
The Yankees ended up winning the World Series that November. My mom died two months later, on January 15, 2010.
By then my family had been in Pittsburgh for sixteen years. My son Michael was out of college, Brian was soon to graduate, and Katie was halfway through her studies. Denise and the two younger kids lived in the house we’d built upon moving from Binghamton. I lived a few miles away.
For years, I was unsure I’d ever get married again; I was consumed by guilt and regret over the failure of my marriage to Denise. But Donna and I proved a really good couple. She went to bed happy every night and woke up the same way. She was big-hearted, funny, and patient with me—that last part a key ingredient to our success, given the time that Dick’s required. She was a wonderful mother to her young son, Ryan, and unfailingly kind to my kids. Plus, she was fun, energetic, and as crazy for golf and skiing as I was—a tomboy, the prettiest tomboy I could imagine. My guilt never left me entirely, but I fell in love with Donna, and she helped me get past it.
When we started to get really serious about where our relationship was headed, we decided she shouldn’t work at Dick’s anymore. She moved to Nike, where she was a strategic account rep. The job was important to her. She’d worked since she was sixteen, had always made her own way through life, had always built her own financial security. That wasn’t going to change—not after we became engaged or, she thought, once we were married.
Except that six weeks before our wedding—which took place in August 2013—Nike let her go. She called on Dick’s buyers as part of her job, and evidently the company didn’t want her doing that as my wife. Donna was devastated. I was pissed. She had no shortage of job offers and wrestled with whether to take one; she was sensitive to people’s thinking, Oh, she married Ed Stack so she doesn’t have to work anymore.
I left the decision entirely up to her, listening as she ticked through the pros and cons, until after weeks of anguish she asked me for advice. “If it was me,” I told her, “I’d consider not going back to work. If you really miss it, you can always go back, but Ryan’s eleven. When he goes off to college, you’re never going to think, Gee, I spent too much time with my son.” Also, I pointed out, she loved spending time with her
mom, who lived a few minutes from the house.
A few days later she announced that she wouldn’t accept any of the jobs she’d been offered. She’s instead thrown herself into all sorts of things—she’s joined the boards of several private foundations—to the point where her calendar is probably fuller today than it ever was when she was selling for Nike. She says to me now, “I’m way too busy to work.”
Ryan lives with us half the time. I’ve watched him grow into a young man who makes both Donna and me proud, and a talented student and athlete. I’ve come to love him like one of my own.
* * *
While my personal life was changing, Dick’s continued to grow. We had 444 stores in 45 states by the end of 2010, added another 36 in 2011—at the same time topping $5 billion in sales—and the following year, with the financial crisis now firmly behind us, had 518 stores and were closing fast on $6 billion. While we flourished—our growth now so carefully and thoroughly researched and practiced that it approached the reliability of an algorithm—our competition faltered.
And by that I mean Sports Authority, because by now it stood alone among our challengers on the national scene. In 2005, our old nemesis was neck-and-neck with us in sales. The following year they were bought by Leonard Green, the same private-equity outfit that had attempted to snatch us up. Their new owners flattered us: they introduced a new look to Sports Authority stores, with well-defined departments arranged like boutiques under one roof. Even so, by 2010 their sales hadn’t budged, while ours had nearly doubled. As we opened new distribution centers in Atlanta and Phoenix, and solidified our hold on the West Coast and some of the country’s biggest metropolitan areas, they oversaw a flatlining store count and mounting debt. In 2015, according to news reports, they owed their creditors a billion dollars.
We received hints that they’d welcome a merger. We couldn’t imagine how that would work. We already owned the markets where we overlapped, and in those where they were better established, we’d have had to spend a ton of money to reconstruct their stores to resemble ours. We had several conversations, but they went nowhere. It was clear to us that we could simply wait them out. We were in forty-six states and had only two major markets left to capture: South Florida, where we were making inroads against Sports Authority’s greatest concentration, and the five boroughs of New York City, where we were unwilling to spend the ridiculous sums necessary to buy or lease real estate. For the time being, we left that to Modell’s.
Our attention was shifting to a new adversary, anyway. A dozen years after our venture capital partners tried to push us into becoming an online-only business, Amazon had emerged as a growing threat. Until now we’d been able to out-position our competition with smart real estate decisions. That wasn’t as effective when the competition was a click away. While I hope there’ll always be demand for a bricks-and-mortar, sensory, in-person shopping experience—for the entertainment aspect of shopping—we and every other retailer had to develop new strategies and tactics to keep up with a changing, tech-savvy consumer. Shoppers’ time is the linchpin of success or failure: they want what they want how they want it, and they want it now. We have to be able to answer those demands.
Michele Willoughby had led our e-commerce effort for years, and she had done a wonderful job positioning Dick’s to compete online. Under her guidance, we turned a small, insignificant aspect of the business that was losing money into a profitable engine that posted more than a billion dollars in sales. When Michele retired in 2016, we put our e-commerce business in the hands of Lauren Hobart.
It was largely her task to transform Dick’s from a physical retailer to an “omni-channel” player. While the Internet is often blamed for the demise of retail, the fact is that our stores and our online presence complemented each other—they could, working together, make Dick’s the go-to sporting goods provider regardless of where our customers were and when they wanted to shop. We could actually build customer loyalty by fully integrating our online and physical “channels” into a seamless whole.
If we executed correctly, we knew our websites should benefit from our great network of stores, and they from a robust online portal. In fact, our stores gave us a decided advantage over the competition. A customer could order an item online and choose to pick it up at the store, or order it online at the store and have it shipped to his or her home. A shopper could return or exchange an online purchase at the store, which is far less of a hassle than shipping packages back and forth. Most important, that shopper could review our offerings online, then come to the store to experience them firsthand—because, convenient though the Internet might be, there’s no substitute for trying on a jacket, feeling the quality of a piece of gear, stepping on a treadmill, or lacing up a pair of running shoes.
By 2013, increasing synergies between our channels enabled another advance: a customer could shop online, and our integrated systems relayed the order to the store nearest them, which arranged for delivery—faster for them, cheaper shipping for us, and it enabled us to use store inventory to fulfill online orders.
Our theories about symbiotic benefits seemed to be affirmed by something we noticed along the way. Eight in ten of our online orders shipped to customers who lived within an easy drive of a Dick’s store. When we opened a new Dick’s store, our online orders in that area typically doubled. Growth in one channel did, indeed, appear to drive growth in the other.
It didn’t take long to capture a meaningful share of online business. From 2009 to 2012, the online sporting goods market experienced a compounded annual growth rate of 19 percent; during the same period, Dick’s e-commerce sales grew by 41 percent. They took off from there. In 2013, our online sales jumped by 65 percent. They accounted for 10 percent of our total sales in 2015. A year later, they surpassed a billion dollars for the first time.
Meanwhile, the sporting goods landscape was becoming littered with empty big boxes. Austin-based Golfsmith, long a strong competitor with more than one hundred locations, was dragged into bankruptcy by building too many of its stores too big and went belly-up in 2016. Gander Mountain declared bankruptcy in 2017, and under new ownership (and a new name—Gander Outdoors) reopened less than half of its chain.
And Sports Authority, which had been wallowing in debt and mediocrity for years, missed a $20 million interest payment early in 2016 and declared bankruptcy shortly after. At first it announced it would close only 140 of its 460 stores, but the chain couldn’t reach a deal with its creditors, and in May it announced its liquidation.
In the space of little more than a year, twenty-two million square feet of sporting goods space emptied—sales floors that had been devoted to doing battle with Dick’s. “The disruption… positions us well to optimize our core business,” I wrote in an annual report. All that market share was up for grabs, and the new real estate environment “allow[ed] us to be patient for the best locations at the best terms.”
We bought Golfsmith’s assets and inventory at auction and opened Golf Galaxy stores in some of their better locations. We snatched up some of Sports Authority’s prime spots. Of the forty-three stores we opened in 2017, nineteen were built in the shells of former Sports Authority locations. The retail apocalypse, as the press was calling it, was good to us.
I’m going to stop this litany of success here because I’m getting ahead of myself. I instead want to talk about a tragic event in the nation’s history that opened a defining chapter in the Dick’s story.
It started on a Friday in December 2012, when a young man walked into Sandy Hook Elementary School in Newtown, Connecticut.
CHAPTER 17 “IF WE WERE TASKED WITH SOLVING A PROBLEM, WE’D SOLVE THE PROBLEM”
Newtown, Connecticut, was a quiet place. Through most of 2012, it retained a small-town charm that seemed to contradict its location just an hour’s drive from New York City. In the previous ten years, it had recorded just one homicide.
That changed on the morning of December 14, when a troubled twenty-year-old misfi
t shot and killed his mother in her bed, then drove across town to Sandy Hook Elementary. Once inside the school, he gunned down twenty little kids, all six or seven years old, along with six staff members. At the time, it was the second-worst mass shooting in American history.
We didn’t know the details until hours after the shooting stopped. I had a TV on in my office as they emerged, horror by horror, in a slow drip that afternoon. The victims were little kids, completely defenseless. The gunman had cornered most of them in their classrooms and shot them point-blank. It was an act so unthinkable that my coworkers at Dick’s, hundreds of miles away from the carnage, cried and hugged each other in the halls. I was having trouble wrapping my mind around what had happened, and in the solitude of my office, the revulsion and grief I felt at the act itself was sharpened by an all-too-familiar anxiety. The school was not far from a couple of our stores. I waited for the networks to mention the gunman’s name.
Elsewhere in the Store Support Center, our people were preparing to launch a frenzied search of our records for that name, an effort that had become a terrible routine in the wake of any high-profile shooting. Dick’s, like every licensed firearms dealer, kept a record of every gun transaction—in a six-page Form 4473, which is paperwork required by the federal government, and in our own logbooks listing the details of every sale. Completing the 4473s required us to verify the purchaser’s identity; enter his or her name in NICS, the National Instant Criminal Background Check System (and record the number the NICS spit out when it okayed the purchase); and have the buyer fill out an affidavit swearing that he or she was eligible under federal law to buy a gun. It was an exacting process.
Naturally, we hoped we wouldn’t find a match. It wasn’t so much that we worried we’d made a mistake that put a gun into the wrong hands: we were downright obsessive in our attention to every letter of the law, every box on the forms. We knew those 4473s had to be perfect, every time. But we were a big company. We sold a lot of guns. And although we consistently did everything we could to ensure that every sale hewed to the law, there was this nagging fact: the perpetrators in the vast majority of mass shootings had come by their weapons legally. We could do everything right and still wind up selling a rifle, shotgun, or handgun to someone who’d later use it in terrible ways.
