Decathlon, ‘Trader Joe’s of sporting goods,’ returns to U.S.

Editor’s note: A version of this story originally appeared on Bicycle Retailer & Industry News.

EMERYVILLE, Calif. (VN) — Sports-minded Americans have returned from Europe for years with tales of a sports retailer with fantastically inexpensive, good-quality gear that wasn’t available stateside. The stories sounded unbelievable: race-worthy cycling bib shorts for $40, $5 cycling gloves one might actually wear, $30 down jackets, $40 running flats that dominated feet at the Paris marathon, standup paddleboards, ball sports of every conceivable type (pétanque!), equestrian supplies, snow sports, and camping, backpacking and climbing technical gear good enough for an Everest expedition. Indeed, a gear junkie’s dream with equipment for some 80+ different sports.

Just as Trader Joe’s grocery stores in the U.S. attained near-mythical status with gourmands unlucky enough to have one nearby, French sporting goods retailer Decathlon had the same effect on cyclists, runners, climbers, triathletes, swimmers, and skiers with the good fortune to visit one of the chain’s stores while traveling abroad.

Now in 48 countries on five continents, with 90,000 employees in some 1,600 stores, Decathlon is the world’s largest seller of sports stuff, 95% under its own house brands such as Quechua, Kalenji, B’Twin, and Simond. Like Ikea, Decathlon is vertically-integrated with products researched and designed in-house by a huge R&D team (example: 200 product developers just in cycling), often built in their own factories, and then sold directly to consumers in their own sprawling stores, at prices that typically would be considered “wholesale.”

Decathlon has long known it needed to be in the world’s largest sporting goods market, and indeed put a small toe in the water in the U.S. 1999 when it bought MVP Sports, a New England-based chain and tried to reimagine it, without adequate research or a good strategy. It quietly exited the U.S. in 2006, leading pundits to say it was proof American sports consumers prefer premium brands and service.

This time around the French firm chose to send a team from France to study the market for two years, before opening an 8,300-square-foot “lab-store” in downtown San Francisco in 2018 to test various retail concepts. Back home it made a multi-billion Euro investment in higher-end house brand products, R&D, and manufacturing facilities — in what many insiders call the most sophisticated supply chain in sports. And it launched sales across the U.S. on decathlon.com.

The store itself

To see how this all translated at retail we visited its first 47,000-square-foot “superstore” in nearby Emeryville, across the San Francisco Bay shortly before the grand opening in April.

The store is located next to an Ikea, Best Buy, and Super Target. We found it to be bright, airy, and well-merchandised. Decathlon managed to fit 7,000 different model codes of product inside — a blizzard of shoes for seemingly every outdoor activity, yoga mats, snow and water sports, and a full-on bike shop.

We were introduced to retail team members who told us they had been to national championships in running, swimming, triathlon and cycling, as Decathlon recognizes that having staff who know and use their product is key to selling it.

Much like an Apple store, cash registers aren’t visible, with most sales happening at mobile check-out counters. Every product is RFID tagged to make it easy to find products, facilitate easy check-outs, and help manage inventory.

If a product is out of stock in the store, same or next day replenishment is offered or it is shipped free to the consumer.

The bike area in Emeryville

Befitting the status of the world’s largest bicycle retailer it is not surprising to see 4,400 square feet set aside at the front of the store to sell Decathlon’s B’Twin, Van Rysel, Triban, Oxelo, Aptonia, and Kalenji bicycle and triathlon brands. Merchandising, while clean and straightforward for the bike area, was nothing remarkable or trendsetting in a market with some very sophisticated independent bicycle dealers; what was especially noteworthy were the retail prices on soft goods. Bib shorts for $40. Cycling gloves for $5. Full-featured rain capes costing $20 and $25 helmets. All appeared to be of excellent quality. While parts, tools, and accessories under Decathlon’s various brands were available, they weren’t lower-priced or better-made than counterparts widely available online (example: house-brand 10-speed chains were $25). Inner tubes were a bargain, though: House-brand 700×25-30mm Presta tubes retail for $3 online and $3.99 in store.

More than 200 bikes ranging from $50 kid’s striders to $4,000 full-carbon road bikes were on sale with a notable focus on kids bikes. Pricing was attractive but about on par with equivalent offerings from direct-to-consumer brands like Canyon and Fezzari — perhaps reflecting the relatively low-margins complete bicycles now see in the U.S.

One new focus is the Van Rysel brand of high-end apparel, bikes, shoes, and helmets, launched earlier this year with higher price points. Decathlon believes markets are increasingly “niching” into smaller and smaller segments and that it must adapt its products and marketing to this new reality. Expect the French retailer to roughly double the number of its in-house brands in the next few years.

Noteworthy is a storewide focus on triathlon, which Decathlon believes is underserved in U.S. retailers. The store doesn’t yet carry triathlon bikes but its attractively-priced house brand tri-bars, wetsuits, shoes, and apparel are specifically targeted at multisport.

Surprisingly missing were e-bikes, which the brand sells in some other markets and which are awaiting U.S. compliance. Until its own e-bikes are available in the U.S., Decathlon will be selling e-bikes from Pure Cycles.

How does Decathlon offer a $40 bib short?

We asked an experienced bicycle-clothing product manager familiar with sourcing in Europe and Asia how Decathlon can come to market with a $39.99 retail-priced bib short. Looking at the short, he explained that Decathlon’s huge scale, direct purchases of fabric and chamois, and no middlemen or distributors make it possible. “I’m actually surprised at the quality,” he said. “Heck, I’d ride these.” When looking at the more expensive $60 Van Rysel house-brand bib shorts, he told us that it had the look and quality typically found in the U.S. at $150.

Kid focus

Also noteworthy is the amount of space devoted to children’s sports. Roughly 25% of the retail space and 35% of the product in the store are dedicated to minors; for example, there are far more kids bikes, helmets, and clothing than typically found in an independent bike shop. Decathlon says parents like both the low prices and technical nature of its products, which have many of the same features of its adult lines. One obvious age-old strategy is that by introducing young consumers to its brands, it will keep them as they grow older. Decathlon has also committed to marketing outreach at local schools; it drove its cool 1970s vintage Citroën van to one elementary school in Oakland and distributed 800 athletic balls to a throng of screaming students.

What’s next for Decathlon?

If the Emeryville store meets certain sales targets, the next step is additional locations in the San Francisco Bay Area, and then other large sporting goods markets, such as New York and Los Angeles. Online sales already make up more than half of the brand’s sales and are expected to continue to grow.

To some, Decathlon’s entry in a market has a downside, as specialty retailers in bike, run, and snowsports are often displaced. For example, in France Decathlon’s impact on the decline of independent bicycle shops has been well documented, with independent bike dealers holding less than 10% of the overall bike market. And consumers in new markets such as the U.S. may take some time to get used to house-brands they haven’t heard of — or trust.

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