Behind Decathlon's 10 billion annual sales: a differentiated strategy centered on experience

There is a brand that adopts an "experience-centered differentiated business strategy" to transform tens of millions of fans in private domains into a potential growth base. This is Decathlon, which is committed to using experience to stimulate users' sports satisfaction and private domain operations to provide extended services after transactions, greatly improving conversion efficiency.

Influenced by Jia Ling, I have been working out recently.

During this process, I discovered something interesting: once people are ready to start a new sport, they tend to make impulse purchases and buy all the equipment first.

When it comes to buying sports equipment, we have to talk about this place: they can sell more than 10 billion a year and are jokingly called the paradise for straight men, the paradise for poor people, and the IKEA of the sports world.

The company is called Decathlon.

The latest news is that Zhang Xiaoyan, known as "lululemon China's No. 1 employee", has joined Decathlon China as CMO. It is estimated that they will have to work harder. Nine years ago, they proposed to open 500 stores, but now there are only more than 300 stores, which is a big gap.

But the discussion on Xiaohongshu has become more heated recently. In a sense, young users have become more receptive to it. We will have to wait and see whether it helps sales conversion.

My interest in Decathlon is not the price/performance ratio, but the experience.

The experience mentioned here is not just a trial. It requires scenes and atmosphere. The scene must be there, the space must be built, and the atmosphere must be created. In this way, experience first and then buy, and the conversion efficiency is higher.

I call this: a differentiated business strategy centered on experience.

The official has also expressed a similar view, which means: transforming from a traditional shopping mall to a "national sports field" with user needs as the core.

This time let’s talk about this topic, how to implement “experience-centered” approach.

1. Insist on using experience to stimulate users' sports satisfaction

To sort out, the needs of entry-level sports players are probably like this:

I want to buy equipment, but I don’t know what to buy or where to buy everything at once. What if the equipment is too expensive or unsuitable? How can I avoid pitfalls?

Decathlon solved this pain point with an "experience-centered" strategy.

How to build an experience scene?

1. Many SKUs

There are more than 30,000 products in total, and you can buy equipment for almost every sport you can get involved in.

For example, I have recently become particularly interested in fishing, but I don’t know what to buy or where to buy all the equipment, including fishing rods, sun hats, clothes, tables, chairs, etc. I can get all of these in one place at Decathlon, saving me money and time.

2. Display by scene

Table tennis, football, basketball and golf each have their own dedicated experience areas. Decathlon will build the usage scenarios for you based on the product it wants to sell.

For example, for archery, there are complete operating instructions, and for table tennis, there is a table where two people can play on the spot.

3. Give customers enough freedom

It creates a relaxed and happy atmosphere where you can play freely, such as table tennis, archery, golf, and basketball, until you are satisfied.

On the one hand, there are fewer service staff, which reduces operating costs and does not disturb users. On the other hand, a larger proportion of the space is cut out for the experience area.

Taking a 4,000-square-meter store as an example, the experience area should account for 15% of the space.

Using the above three points to build an experience scenario plays a decisive role in converting entry-level players.

According to their data, 70% of people who have experienced the product will choose to buy it, which is 5 times higher than those who have not experienced it.

Decathlon has found the key to its differentiated competitive advantage: the core of motivating purchases of sports products lies in the experience of satisfaction.

On the other hand, why do some offline stores perform poorly in terms of traffic and conversion?

The essence is that the experience is not good.

I have been to many stores selling cosmetics. When customers walk in, the salespersons will immediately follow up with questions or even force them to place orders, which puts great psychological pressure on customers.

A better option is to give customers the opportunity to freely try out various new cosmetics. The whole process should be easy and enjoyable, and if they feel the effects are good, they will naturally place an order.

A relaxed, free and happy experience is the key point for offline sales conversion.

Why set up a free experience scene?

Increase user stay time.

The longer the user stays, the higher the consumption conversion rate. This is the same logic as the short video platform using content to retain users. The algorithm will give you more traffic if the user stays longer on the video.

For example, IKEA has enough home scenes that people can spend hours shopping there. When they get tired, they can have a meal. There are also Sam's Club food tastings and so on.

2. Private domain operations provide extended services after transactions

Let’s review user needs: Many times, people want to exercise, but cannot find a partner, no one to accompany them or guide them, and the exercise is put aside for a long time.

Decathlon has done one thing: providing users with a team-building platform through private domain operations.

Each of his stores has a QR code, allowing users to enter different communities based on their favorite sports.

For example, I have recently become very interested in frisbee, but I cannot find teammates. These communities will regularly hold frisbee events, and I can directly sign up to participate.

The group will also regularly release relevant professional knowledge.

For example, how to run without hurting your knees, what you should pay attention to when fishing, how to choose a site for outdoor camping, etc. When there are promotions or new products, you will be notified in the community as soon as possible.

Why does Decathlon put so much effort into building a private community?

Essentially, it is to increase the repurchase rate. Human nature is lazy, and exercise and fitness are against human nature.

Many people buy equipment on impulse but never use it. Decathlon will organize activities to invite you to participate and provide post-purchase services.

The more frequently users participate, the greater the probability of repurchase .

Decathlon is equivalent to extending the experience scene from stores to sports fields. It uses private domain communities to interact with users from offline to online, improve stickiness and brand awareness, and stimulate purchasing desire.

This is valuable, judging from the following data:

In December 2023, 75% of Decathlon's sales came from members, and the repurchase rate of old customers was 70%. The number of private domain fans exceeded 10 million, and the average customer price in the private domain was 3 times higher than that of ordinary members.

Decathlon has transformed private communities into countless sports clubs, hosting tens of thousands of events a year with hundreds of thousands of participants across the country.

These tens of millions of fans in private domains are the basic foundation for Decathlon's potential growth.

Finally, let’s summarize Decathlon’s approach:

Experience scene construction → user on-site experience → user purchases goods → user enters private domain community → participates in community activities → continues to repurchase

Business growth comes from differentiated operating strategies. High repurchase rates and high average customer spending can bring greater growth.

Author: Han Xu

Source: WeChat public account "HanXu (ID: kenengyouxihanxu)"