The Marathon Man
John Stanton takes the Running Room on an uphill climb in the U.S.
JASON KIRBY | August 6, 2007 |
The owner and president of the Running Room is about 20 minutes into a run along the seawall of Vancouver's Stanley Park when he makes a startling statement. John Stanton, the man who has come to epitomize healthy living and active lifestyles, links his success to the world's largest fast-food chain. "I McDonaldized running," he says. Runners may not approve of some of the greasier items on Mickey D's menu, Stanton adds, but no one can beat them on process and standardization. Now, as the Running Room runs out of room to grow in this country, Stanton must turn his focus to the supersized market of the United States, where so many Canadian retailers before him have been chewed and spit out.
If the secret to McDonald's domination was its addictive french fry, at the Running Room it's the 10 and 1. Stanton, 59, didn't invent the technique of running in 10 minute intervals, broken up by a one-minute walk, but he ingrained it in the hundreds of thousands of new runners who have enrolled in the store's clinics. As such, he took running out of the exclusive realm of the hard-core athlete and brought it to the plump masses. Runners of all stripes turn up at his stores several times a week for group runs, and in between lectures on the art of breathing and treating shin splints. They fork out gobs of cash for shoes, apparel, and a mind-boggling array of gadgets, from heart rate monitors to GPS-enabled watches.
The model has made Running Room one of Canada's fastest growing homespun retailers. "They've found a niche where serious runners are concerned," says John Williams, a retail analyst in Toronto.
It's tempting to think of Stanton's success as a sprint, but it has all the elements of a marathon. In the early 1980s, Stanton was a vice-president for a national grocery chain. When his youngest son, Jason, wanted to enter a three-kilometre fun run, he asked his father to go along with him. Stanton weighed close to 240 lb. at the time and was a heavy smoker, but figured it would be a cinch. Clad in cut-off jeans, leather shoes and black socks, he made it to the end, but barely. Stanton started running every day, quit smoking, and before long shed 60 lb. The businessman in him twigged to an opportunity. There was very little in the way of running gear available, so he opened the first Running Room in 1984, in a room of his Edmonton home, selling shirts and providing advice to new runners.
The company now operates 90 stores, mostly in Canada, nearly double from 2002. All told, the chain rings up between $75 million and $100 million a year in sales. No exact financial numbers are available though, because unlike so many other Canadian retailers, Stanton has shunned the stock markets. Instead he owns the company outright with his two sons John and Jason, who split day-to-day management duties. That's left the swift-footed patriarch to build the brand, in his own image. His face is plastered on promotional materials. He's on the road up to 300 days a year visiting stores and showing up at marathons across the country to pump up runners like some athletic evangelist.
But while all those things have made Running Room a success in Canada, Stanton admits the market up here is mostly saturated. The company has made a push into the U.S. in and around Minneapolis, but growth there has been slow. The mammoth U.S. market has been a graveyard of ambition for a long line of Canadian retailers who were bigger and better funded than Stanton. Think Canadian Tire, La Senza and Le Chateau. "Canadian retailers have grossly underestimated the competitiveness of the American market," says Williams. "Americans are take-no-prisoners type retailers."
Stanton is acutely aware of the dangers, and he admits Running Room's formula faces a gnarly uphill climb in the U.S. market. For one thing, Canadian runners seem to enjoy the camaraderie of group runs, which helps transform them into return customers. Americans are more apt to crank up their iPods and try to outgun each other.
Still, he's not ready to give up or to cash out. Almost weekly, Stanton says, bankers offer to take Running Room public to crank up his expansion plans, or to buy him out entirely. But the runner vows to stick to his steady pace. "The danger in going public," he says, "is you'll lose that culture that made you successful in the first place." Especially when you've got a culture that manages to marry the principles of hawking burgers and selling shoes to fitness freaks.