HASTINGS 40th ANNIVERSARY: Change for the good

SEPT. 29 | HASTINGS 40th ANNIVERSARY: Constant change. That has been Hastings Entertainment’s secret to longevity in a business that has seen competitors from the legendary Tower Records to the all but forgotten MediaPlay fail.

Hastings’ competitors and those in the book and video industries describe the multi-media retailer, one of the few still around, as an ever-changing retailer that knows its customer well and is always ready to mix things up to stay in pace with customers’ changing wants.

One of the keys to the company’s success is that it thinks big and views the big chains—from Wal-Mart to Borders to Best Buy—as their competitors, says Bob Geistman, senior VP of sales and marketing for book and DVD wholesaler Ingram Entertainment, who has worked with Hastings chief John Marmaduke through DVD trade group Entertainment Merchants Assn.

“They take that attitude that they’re much bigger than they are, not from an ego standpoint, but from a standpoint that that’s who they’re competing with,” Geistman says. “They demand from vendors a lot of equity.”

Those larger retailers declined to comment on Hastings, some citing policies against talking about competitors. Independent retailers that compete against the chain credit Hastings with being a sharp retailer that knows its customer base.

Video Buyers Group president Ted Engen says his group and its retail members watch what Hastings does, noting that the retailer tends to be a leader in the areas it operates. VBG’s Total Entertainment Centers compete against Hastings in some locations; both stores rent and sell DVDs and videogames.

“They make pretty good, sound business decisions,” Engen says. “That’s why we watch them pretty closely. They do a lot of footwork and a lot of research before they make a move. Usually, if they make a move, it’s pretty calculated.”

Retailers who know Marmaduke and his team call them smart and business savvy.

“He is positively one of the brightest guys I’ve ever had the pleasure of working with,” says Chuck van der Lee, CEO of Canadian video chain Rogers Video. “He’s visionary, good with numbers, articulate, has a good sense of humor. He’s a big-picture guy.”

As their stores don’t compete, van der Lee and Marmaduke share tips on strategy. One of the areas Rogers has learned from Hastings is its handling of previously viewed movies. The Canadian chain also is considering following Hastings into the book business. Van der Lee and a team of Rogers VPs will head to Hastings headquarters in October to trade other strategies.

Suppliers cite Hastings’ customer knowledge as one of the reasons it has outlasted competitors in books, music, movies and variations of the three.

“Hastings has adapted quickly and intelligently to a constantly changing marketplace with great success,” Lionsgate executive VP of sales and distribution Jed Grossman says. “By catering to many different demographics with their wide selection of movies, magazines, games, books and music, Hastings has remained relevant and strong as they have evolved into a multi-media destination.”

20th Century Fox Home Entertainment senior VP of sales Don Jeffries attributes the chain’s success to its “laser focus on its customers.” According to Jeffries, “The team at Hastings understands that their customers don’t have to come in to their stores, so they create an environment where [customers] want to come in to a Hastings store.”

Ingram’s Geistman says that to keep customers coming back, Hastings constantly reviews the product it carries, making sure the stores are on top of the trend of the moment. They not only change their product mix, they also modify how they merchandise DVDs, books, music and whatever else they’re carrying.

“A consumer that comes into a store, after the first few trips, they get blind to everything,” Geistman says. “The first time they see something, they may say, 'that’s cool;’ by the third or fourth time they see it, they don’t notice it. Hastings is good at constantly changing their store design so that it always remains fresh.”

They’re also good promoters, creating events around new movie and book releases.

“The products they support aren’t just commodities to them; they’re opportunities to create excitement,” says Jeffries.

Hastings stores are located in smaller markets, often with a more conservative customer base, which the retailer is known for catering to, both in terms of price and product mix.

For example, its Round Rock, Texas, store in the Austin suburbs tends to carry more Christian book titles than downtown Austin book haven Book People, that store’s CEO Steve Bercu says.

Half Price Books, another longtime Texas-based book, DVD and CD chain, in business for 35 years, competes with Hastings in College City, Texas, where the two have stores down the street from each other. So, is longevity a Texas thing?

“Texas is a hard market to break into,” Half Price executive VP Kathy Doyle Thomas says. “But because of the size of the market, you can have a lot of growth and expansion in the state.”

Thomas credits Hastings with having great merchandise and friendly employees.