Curling is having a moment... Sporting goods stores aren't. With Amazon competition and a decline in youth team non-virtual sports, Dick's Sporting Goods stock is below where it was 12 years ago (and compadre The Sports Authority is RIP). But it showed it can still suit up and take the field, announcing quarterly sales rose 3.2%. But we're interested in its guns experiment.
The school shooting in Parkland, FL in Feb, 2018 was heartbreaking... Dick's CEO Ed Stack took action by banning assault rifles and raising the age to buy a gun at Dick's to 21. He's also deciding whether to ban firearms altogether at the sporting goods store (they're in the "hunting & shooting" section). Here are the two intense choices he's facing:
- Don't ban guns, and potentially face the negative PR of selling a weapon used in a mass shooting.
- Ban guns, and face the negative PR of being anti-2nd amendment.
This is claaaassic "A/B testing"... That's when you isolate one variable, then measure two groups to see which was best — one with it, one without it. In the fall, Dick's ended gun sales at 10 of its stores. This spring, it did it for 120 more. Now it's watching the performance of two groups:
- Group A: 600 stores still sell guns & ammo.
- Group B: 130 stores don't.
Management hasn't decided yet which group is performing better, but it knows the one variable that would drive the difference: guns. Soon it'll announce which way is better for its profits.