RCG Corporation, the owner of The Athlete’s Foot chain, announced a record half‐year profit today and chief executive, Hilton Brett, is putting it down to the retailer’s “customer-centric” strategy.
RCG lifted consolidated net profit after tax 9.2% from $4.61 million to $5.03 million, while earnings before interest tax and depreciation increased 4.7% from $6.77 million to $7.1 million.
Brett told SmartCompany RCG is targeting full-year earnings growth of 15% and has achieved this growth through emphasis on customer service.
“Everything we do in that business is customer-centric,” he says.
“We don’t ignore the threat of online, but our business is a high service model.”
Brett says The Athlete’s Foot creates a point of difference through its highly trained staff and franchised business model.
The retailer also does extensive work with the medical community, including chiropractors and podiatrists.
Brett says this approach protects The Athlete’s Foot from the problem of “show-rooming” where customers go into retailers to try on goods and then buy them elsewhere.
“There is a little bit of that but not really,” he says.
“The sales process from the consumer perspective takes about 20 minutes; it is very seldom that the consumer does not buy.”
The Athlete’s Foot consumers are “slightly older” with a “strong referral base” enabling the retailer to combat show-rooming.
But Brett says The Athlete’s Foot is still trying to lure consumers through a multi-channel approach.
“We are engaging with our consumers online as they are doing a lot more research online and our website traffic has gone up substantially,” he says.
RCG’s half-year results were also given a boost by the company’s wholesale business, which includes the acquisition of Saucony, four partnership store acquisitions and the rollout of five new Merrell stores.
“We have had strong growth out of Merrell, good growth out of our CAT business and there has been the acquisition of the Saucony brand,” he says.
Cara Waters is the editor of SmartCompany. Cara was previously a senior reporter at the Financial Times website FT Adviser in London and has also worked for The Sunday Times.
