Supporting Gun Control Is Great for Business

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In the wake of the February 14th school shooting in Parkland, Florida, that left 17 students and staff dead, Dick’s Sporting Goods, the country’s largest and most resilient sporting goods company, announced it will stop selling guns to customers younger than 21. The company will also be halting the sale of assault rifles and high-capacity magazines, effective immediately.

In a widely released company statement, Dick’s chairman and CEO Edward Stack said that the decision came in the aftermath of the shooting and after watching students rally together for stronger gun control in the US.

“We at Dick’s Sporting Goods are deeply disturbed and saddened by the tragic events in Parkland,” Stack writes. “Our thoughts and prayers are with all of the victims and their loved ones. But thoughts and prayers are not enough.”

Back in 2012, Dick’s stopped selling assault-style rifles in its stores following the Sandy Hook Elementary School shooting in Newtown, Connecticut. A year later, though, Field & Stream, a subdivision of the company focused on hunting and the outdoors, began selling the weapons again at its 35 locations. On Good Morning America on Wednesday, Stack said all Dick’s brand subdivisions will permanently stop selling these type of guns.

While the shooting has left a searing impact on the whole country, it’s also left a mark on Stack, whose father started the company in 1948. In his statement, Stack writes that Nikolas Cruz, the shooter in Parkland, legally bought a shotgun from Dick’s in November 2017, and while it wasn’t the gun Cruz used in the shooting, “it could have been.” On GMA, Stack added that the company “did everything by the book. We did everything that the law required and still he was able to buy a gun. When we looked at that, we said, ‘The systems that are in place across the board just aren’t effective enough to keep us from selling someone a gun like that.’”

Dick’s, which has more than 700 stores across the country, isn’t the first major corporation to get involved in the latest debate on gun control. Following the Florida shooting, dozens of corporations announced they would be cutting ties with the National Rifle Association, including Enterprise, Hertz, MetLife, and Delta Airlines. (Companies like FedEx, Amazon, Cabela’s, and Bass Pro Shops, on the other hand, are still offering perks like discounts to NRA members).

Dick’s move, though, is clearly in line with the company’s customer demographic and business sensibility. Paul Kemp, one of the board members of the group Gun Owners for Responsible Ownership, or GOFRO, notes that while many proud gun owners might get upset at Dick’s, the company is sending a good message directly to its customer base.

“Dick’s market is oriented at America’s youth, so it’s not surprising that this shooting has impacted their corporate culture,” Kemp tells Racked. “Dick’s is a major partner in the school systems and with local youth sports around the country, and so this is a business decision that is good for their market. It’s a good message that they are sending to the large majority of their shoppers. They are listening to America’s youth.”

Kemp adds that “Dick’s isn’t going to stop selling firearms all together. But they are clearly speaking to a demographic.”

The company earned $7.9 billion in revenue in 2017, and as Forbes notes, its growing profits in a sector of retail that is struggling is largely thanks to the company’s involvement in youth sports. Since 2014, the Dick’s Sporting Goods Foundation has been funding over 180 youth athletic teams across the country via its Sports Matter program, and it’s committed over $50 million to the cause. In its 2016 annual report, Stack also talked about the company’s involvement with local communities, where it’s been “sponsoring thousands of teams in various sports at the local level.”

From a branding perspective, how can a company, which actively works with Little Leagues and school sports teams, simultaneously sell AR-15s? Up until now, Dick’s has seemingly been doing it with ease, but as Stack said on GMA, the company finally felt like “we need to do something.”

With this move, Dick’s is also carving itself out as the store of choice for gun owners who support gun control. On Facebook, GOFRO, for example, wrote, “THANK YOU, DICK’S Sporting Goods, for making the commitment to go beyond what’s legally required and for being a responsible gun dealer.” Kemp, of GOFRO, says he supports the move “fully, one hundred percent.” The debate surrounding gun ownership is often loud, emotional, and with extreme opinions ranging from pleas to stop selling guns completely to the strictest interpretations of the Second Amendment. Stack is providing nuance, as well as a platform for gun owners who support gun control.

“We support and respect the Second Amendment, and we recognize and appreciate that the vast majority of gun owners in this country are responsible, law-abiding citizens,” he writes in the company statement. “But we have to help solve the problem that’s in front of us. Gun violence is an epidemic that’s taking the lives of too many people, including the brightest hope for the future of America — our kids.”

Will this decision bolster sales at Dick’s? Investment firm Wedbush Securities reports that guns make up less than 10 percent of Dick’s annual sales, and analyst Christopher Svezia says the impact, as it pertains to dollar signs, will likely be limited. But for now, shoppers are waging a war on both sides. On Twitter, there are strong reactions, with people calling both for boycotts and to spend money at Dick’s.

That Dick’s even took a stance in the roaring debate of gun control is likely to have results. As Richard Kestenbaum, a partner at Triangle Capital, notes, a recent study by Sprout Social found that 65 percent of shoppers believe it’s important for companies to act on social and political issues, and liberal customers are more likely to put spending power into brands that speak up on social media. The study also reported that “the same holds true for stances with which they disagree; liberal respondents are more likely to boycott a company after it takes a stand that opposes their personal beliefs, as well as to publicly criticize that company.”

“I think it’s a good move for [Dick’s] business,” says Kestenbaum. “The benefit they get from aligning their interests with the safety of their consumers will inure to their benefit over time.”