Question: In a recent year, Evo, the Seattle-based snow and water sports equipment e-tailer, made Inc. magazine's list of the 500 fastest-growing private companies. Founder Bryce Phillips started the company in 2001 out of his garage as a way to support his expensive ski habit. He rounded up and sold closeout and used skis in hopes that other enthusiasts would be looking for a good deal on good stuff. Four years later, Phillips had added snowboards, skateboards, wakeboards, and all the apparel and accessories one could need. He amped up the Web site and opened an 8,000-square-foot retail store in the funky Freemont neighborhood for those who want to try before they buy. The Seattle store also offered all the fashions you would need to look awesome in the lodge or bar after a long day on the slopes. His original three employees now numbered around 40 and, in addition to the bargains, he added top-of-the-line new stuff, too. The success of Evo and Evogear.com has been incredible, but Phillips isn't going back on what got him there in the first place: good stuff at a great price, hassle-free.
The online shopper is a different kind of shopper, and the online retailer is different as well. The low overhead enjoyed by online retailers allows them to stock more inventory in a lower-rent warehouse. Larger orders translate into better discounts from the manufacturer or wholesaler. Evo is able to pass these savings on to the consumer. While the hard-core rider or skier is more likely to want the latest and greatest models every year, most are happy with replacing their equipment every few years with a gently used or last year's model at an average savings of 30 to 75 percent off the original price. Evo maintains buying relationships with all the best brands-Burton, K2, Quicksilver, Rossignol, Powell, and many more-but also looks to resorts and pro shops for used rental and demo gear. They even hit up their own brick-and-mortar store for last year's unsold merchandise. The big brands see Evo as a preferred customer and often give them first crack at their closeout and "sale" merchandise as well. This buying strategy puts Evo and Evogear.com right in front of both the pro and weekend warrior, while maintaining credibility with both.
One of the reasons Evo enjoys such great relationships with its customers is its famous price match policy. Shop around-if you find a lower price anywhere, Evo will beat it by 5 percent. Just send customer service an e-mail and as soon as they can verify the competitor's price, they'll lock in that lower price. Five percent might not sound like a lot, but as explained on Evo's Web site, if you see a product that lists on Evogear.com for $400 offered elsewhere for $350, Evo will sell it to you for $332.50. That $67.50 could pay for your lift ticket. What sets Evo's policy apart from many competitors is that the company will match any lower price (except eBay auctions), including promotions, rebates, and end-of-season blowout sales. The price guarantee doesn't stop with the competition. If Evo offers a lower price within 20 days of your purchase, they'll give you a store credit for the difference. If something goes on sale at a competitor within a week of your purchase, you get the difference, too. The way they see it, if you're that committed to finding a bargain, you deserve the break. It takes a little more effort on Evo's side, but "it's a small price to pay for a lifetime customer," says Molly Hawkins, affiliate program manager at Evo. "Maybe we'll sacrifice a little bit of margin, but in the end, hopefully, they'll be coming back for the rest of their life to buy their gear from us."
1. Do you believe Evo's pricing strategy for evogear.com meets the five pricing objectives outlined in the text? Provide examples for each objective.
2. Do you think the opening of the 8,000-square-foot brick-andmortar store in Seattle distracts from their pricing strategy or enhances it? Why? To learn more about the brick-and-mortar store, visit culture.evogear.com/category/seattle/