1000 fishing flies and an ad that failed turned a furniture store family into a sporting goods store empire. Way to go Cabela’s.

Dave Young:

Welcome to the Empire Builders Podcast, teaching business owners the not-so-secret techniques that took famous businesses from mom and pop to major brands. Stephen Semple is a marketing consultant, story collector, and storyteller. I’m Stephen’s sidekick and business partner, Dave Young. Before we get into today’s episode, a word from our sponsor, which is, well, it’s us, but we’re highlighting ads we’ve written and produced for our clients. So, here’s one of those.

[No Bull RV Ad]

Stephen Semple:

Hey, David, we’re going to do something different here.

Dave Young:

Okay. I’m all ears.

Stephen Semple:

Because you have a special history with this company. So we’re going to talk about Cabela’s.

Dave Young:

Okay. Okay.

Stephen Semple:

Because of the fact that Cabela’s started in your little town in Nebraska.

Dave Young:

Kind of. Kind of.

Stephen Semple:

Kind of.

Dave Young:

Yeah.

Stephen Semple:

So we’re going to do this completely unrehearsed, Dave running with things, and I’ll fill in certain-

Dave Young:

You’re going to Google dates and names in the background?

Stephen Semple:

Yeah, that’s what we’re going to do. So let’s give that a roll. Cabela’s is an interesting story.

Dave Young:

It really is, and it still is a brand, right? It’s still around, but it’s owned by the Bass Pro Shop guy, Johnny, whatever his name is. I didn’t get to know him because that’s a Missouri thing. So Sidney, Nebraska-

Stephen Semple:

We don’t like talking about those people.

Dave Young:

Well, he came in and bought it up and saved the company. That’s part of the story. But Sidney, Nebraska was the home of Cabela’s, the family and the corporate headquarters for years and years. It started, though, in a town about 30 miles away, a town of Chappell, Nebraska.

Stephen Semple:

Right. Yes.

Dave Young:

1962.

Stephen Semple:

Well actually, you’re really good. According to what I have here is December, 1961, but 1962 is a month later.

Dave Young:

Yeah. ’62 is what was always on their logo.

Stephen Semple:

Okay, cool. Cool.

Dave Young:

And the shirts you could buy, like Cabela’s EST 1962, but yeah, December ’61. So Chappell, Nebraska, their dad is in the furniture business, and-

Stephen Semple:

I didn’t realize he was in the furniture business. Okay, cool.

Dave Young:

Yeah, and the story. As I recall, is that two of the sons, Dick and Jim, well, at least it was Dick that went to the furniture show with dad in Chicago, where you see all the furniture that you’re going to buy for your store and you make deals with the manufacturers and all that stuff arrives then over the course of the next year. Well, he found a company that he bought like a thousand Chinese-made fishing flies.

Stephen Semple:

Yeah.

Dave Young:

Little flies for fly fishing.

Stephen Semple:

Right. And what I have here is it cost him like 45 bucks.

Dave Young:

Oh, yeah. Yeah. Dirt cheap. Didn’t know what he was going to do with them, but he bought a thousand of them and brought them home. Takes out a little ad in a Wyoming hunters’ newspaper or newsletter. All right? And he-

Stephen Semple:

Sports Afield is the name of the-

Dave Young:

Sports Afield, and the ad, if… So yeah, gosh, now I feel like I’m doing this story and Stephen’s fact checking me, live. So this is, I think, from an ad writing perspective and a business making an offer, this is actually the pivotal moment in the genesis of the Cabela’s story is that they ran this ad in Sports Afield and nothing happened.

Stephen Semple:

Right. I think they got one response or something like that?

Dave Young:

Yeah, but it was the offer. The offer was buy, I think it was 12 hand-tied fishing flies for a dollar, free shipping.

Stephen Semple:

Right.

Dave Young:

Right? So send us a dollar, and in those days, people would just put a dollar in an envelope and send it off.

Stephen Semple:

Right. Yes.

Dave Young:

Right? And that didn’t really create desire in people’s hearts. They didn’t want to buy 12 fishing flies for a dollar. So they ran and nothing happened, maybe one order. They changed the offer to 12 free hand-tied fishing flies, send a dollar for postage and handling, and they sold all of them.

Stephen Semple:

Wow. Amazing. Hey?

Dave Young:

All right? The money is exactly the same, but when you put the value on the fishing flies at a dollar for 12, it makes them seem like they don’t have much value. When you change it to free, and you just need me to send you a dollar to mail them to me, like, “Oh, I don’t know what the value is-“

Stephen Semple:

But they’re free.

Dave Young:

“… but I get 12 of them for free. I get 12 of them for free.”

Stephen Semple:

Right.

Dave Young:

“All I got to do is help you ship them to me.” On the face of it, it’s crazy, right? It’s not logical.

Stephen Semple:

It’s not logical. It should make no difference. And here’s the thing I find that’s also really interesting about that. In the world today, it’s almost flipped. If I was going to guess today, if you were running that offer today, the free shipping would be more powerful than the free product because we’re all-

Dave Young:

Yeah. Maybe so.

Stephen Semple:

Right? The point is, on the surface, it’s exactly the same offer.

Dave Young:

Yeah, yeah. The same amount of money.

Stephen Semple:

It’s a buck.

Dave Young:

Yeah.

Stephen Semple:

It’s a buck.

Dave Young:

It’s a buck. It’s the same amount of money from the customer. It’s the same amount of money to the company. And when they changed the offer, everything changed. Now from there, they just started buying more sporting goods kinds of things and writing more offers. So in this little town of Chappell, Nebraska, about 1,000 people at the time probably, dad has the Cabela’s Furniture store. And by the way, to the best of my knowledge, that store is still there.

Stephen Semple:

The furniture store?

Dave Young:

Yeah.

Stephen Semple:

Wow.

Dave Young:

It was a third brother that ended up in the furniture business, took over dad’s business, and the other two brothers, Dick and Jim, set out to take over the world of sporting goods. They had basically used up all the store frontage in this little town of Chappell and were needing a bigger place because there just wasn’t any more room in that town for them or people to work for them. And so I’m not sure just exactly when, but in the 60s, later on in the 60s, they made a deal with the city of Sidney, a John Deere distributorship had gone under, right? I think they just probably got consolidated out. So there was this big three-story brick building that had been a John Deere parts distributor place, and it was just sitting empty and the city needed to do something. And so they made a deal with Cabela’s to move into that building. And that’s then, for the next several decades, where they ran Cabela’s and they ended up opening their first retail store in there. But they were primarily-

Stephen Semple:

They were catalogs, weren’t they?

Dave Young:

Until the internet hit, they were a catalog company. Yeah, absolutely.

Stephen Semple:

I was going to say, I thought they were a catalog company.

Dave Young:

I don’t know when the internet started, but before the internet started, they were printing more pages of catalogs than JCPenney.

Stephen Semple:

Is that right?

Dave Young:

Yeah.

Stephen Semple:

I had no idea.

Dave Young:

Of all kinds. You could get the Cabela’s Deep Sea fishing catalog, you could get their hunting catalog, you could get their guns and ammo and archery. They had all kinds of different catalogs for their different types of consumers that they sold to. And then every year, they had the master catalog, which was a big hardbound edition of everything they sold.

Stephen Semple:

Hardbound? Wow.

Dave Young:

And it was the size of a dictionary. It was big.

Stephen Semple:

Wow. Wow.

Dave Young:

And so they operated out of that building till… Oh, I would guess what became known as the destination stores that they started doing was opened in Sidney in the late 80s.

Stephen Semple:

Well, Cabela’s, the interesting thing is the Cabela’s stores are really quite the destination. They’ve got aquariums. I’ve heard of some that have shooting ranges and archery ranges in them.

Dave Young:

What they figured out is that people wanted an experience when they went to a store, right?

Stephen Semple:

Yeah.

Dave Young:

So their store in Sidney started that. As you wandered around in that store, and again, it was just a weird store that was cobbled into the front of this former distributorship building. So it had multi levels, there was a basement, there was a main floor, there were stairs that went up to another little part. Didn’t have near the square footage, but they also had things like this giant stuffed polar bear and lots of taxidermy even around that store.

And so they carried that theme through when they started building these destination stores. But I remember as a kid getting a picture taken with the big polar bear in the Cabela’s store, and that would end up being on the front of their catalog. So they became known for those kinds of things. But when I was a kid, Stephen, you could buy a basketball or some ice skates, a baseball bat and a glove. Back in those days, they had their catalog business, but for the town they were in, they were the sporting goods store. Right? They were the place you went to buy any kind of sporting goods.

Stephen Semple:

Right. And it’s really interesting when you think about making a place of destination because then it attracts people to the store. But there is this other idea, and I’ll never forget when I was working in the investment industry, there was a company that was going public here in Canada that had really modeled itself after Barnes & Noble. Here it was called Chapters, but they really were copying the Barnes & Noble methodology. And one of the things they talked about was studies had been done, and look, IKEA understands this. The longer you stay in the store, the more you purchase-

Dave Young:

Oh, sure.

Stephen Semple:

… the more likely you are to purchase. So this whole idea of entertaining people when they’re in the store is you actually want people hanging out. The longer they hang out, the more likely they are to buy something or buy something more.

Dave Young:

And so, I think for 20 years we’ve been… Now and then I’ll get asked to do a presentation on creating word of mouth, right? And the way you create word of mouth is…

Stay tuned. We’re going to wrap up this story and tell you how to apply this lesson to your business right after this.

[Empire Builders Ad]

Dave Young:

Let’s pick up our story where we left off. And trust me, you haven’t missed a thing.

And the way you create word-of-mouth is when Roy first started talking about it, he talked about three different techniques; architectural, kinetic, and generous. And really, I think if you break it down, they’re all three categories of what I would call magnanimity. And when Cabela’s built these destination stores, they knew what they were doing and they hit it on all three accounts. So let’s look at generosity first. They already had ingrained at that time, and I think they’ve stepped away from this now, but their mantra was basically a lifetime guarantee on everything you bought from them. And, “Nobody undersells Cabela’s,” was one of their slogans, but they had this guarantee that if it fails or you’re not happy with it, bring it back and we’ll replace it.

Their returns department was always pretty hopping, and they were just generous about it. I used to joke, I knew somebody that worked in the returns department. I used to joke like, if I came in and just pulled some pocket lint out of my pocket and said, “Yeah, I bought these socks 12 years ago and I’m not happy with them.” Like, yeah, they’d probably march you off to get some new socks. So it was that level of, “Hey, take the customer’s word. There’s always going to be a knucklehead that takes advantage of us, but for the most part, millions of people are going to be happy with what they bought from us.” Most businesses don’t understand that you build that knucklehead factor in, right? There are going to be people that take advantage of you. Don’t let that stop you from being generous.

Stephen Semple:

Yes.

Dave Young:

Because if you want to be known for generous, you’ve got to just take the knuckleheads into account. And if you don’t, they’re the ones that are going to spread the bad news that their whole promise isn’t really what it says it is.

Stephen Semple:

Or you get stuck putting all the fine detail in, which really-

Dave Young:

Yeah, you put all these loopholes in and say, “Oh, well, I’m sorry, but that’s obviously not the right kind of lint to be…”

Stephen Semple:

And it’s interesting. So when we talk about these things, a lot of these things are done to build trust, and you get trust by extending trust. And the moment you start putting all these disclaimers in to protect yourself from the customer, you’re basically saying to the customer, “I don’t trust you, but you should trust me.” And that’s what really weakens it. Yeah.

Dave Young:

Exactly. So you have a policy that just has generosity baked into it. And you’ll see that if there’s a restaurant that just has a policy of, “Hey, you know what? Dessert is on the house in our restaurant. That’s just what we do,” you can become known for being generous.

Stephen Semple:

Right. That’s interesting.

Dave Young:

The other two, that part of it was baked in before they built the destination store. But when they built the destination store, the other two pieces of the word of mouth puzzle are architectural and kinetic. So let’s look at architectural. Their first destination store and all the rest, at least the ones that weren’t… In some cases, they bought buildings that pre-existed and moved a store into them, but for the ones that they built from the ground up, they look like hunting lodges that were built in the heyday of Yellowstone.

Stephen Semple:

Yes. They sure do.

Dave Young:

If you’re in a flat state like Nebraska, you can see it from 10 miles away as you’re heading down the interstate highway. And when you get there, it’s like, “This looks magnificent.” And you drive up and there’s a pond and there’s always a bigger than life brass sculpture out front and a circular drive. You just feel like you’ve arrived somewhere and now it’s time to go in and see what this is all about. And so that architectural generosity continues on the inside. You could sell all this stuff in a store like a Walmart.

Stephen Semple:

You could. Yeah.

Dave Young:

Right? You could decorate it to just look like the inside of a Walmart, barren ceiling and fluorescent bulbs and flat, long linear aisles and stock it with the exact same things. You could sell that stuff.

Stephen Semple:

For sure.

Dave Young:

But that’s not what they decided to do. They wanted to create an architectural treat.

Stephen Semple:

Yeah. Yes.

Dave Young:

And so when you go into one of those Cabela’s stores, and especially the early times, it was walking down a trail in the woods.

Stephen Semple:

And look, and it put you in that frame of mind that’s way easier to imagine using the stuff.

Dave Young:

Architecturally wise, the inside of those buildings was like a cathedral to the outdoors.

Stephen Semple:

Right. Yes.

Dave Young:

Right? Huge roof. And then they would build a mountain inside of it full of taxidermy. And so, jokingly, my kids used to call it the Dead Zoo because you could see just about every kind of animal.

Stephen Semple:

Right.

Dave Young:

Beautifully done, right? I remember when they built the mountain at the store in Sidney, I think the guys that made the mountain, that created it were the same people that do all the mountains and fake things at Disneyland, right? They hired those guys to come out.

Stephen Semple:

Yeah, I was going to say, I bet you they hired those guys. Now, there was a third thing that you said.

Dave Young:

Kinetic.

Stephen Semple:

Kinetic.

Dave Young:

So kinetic is movement, especially the architectural and the kinetic aspect. No place does those two things better than Las Vegas.

Stephen Semple:

Right.

Dave Young:

Right?

Stephen Semple:

Yes.

Dave Young:

Starting with the volcano at the Mirage, was it the Mirage? Yeah. And then continuing on with the fountains and all the things that you see-

Stephen Semple:

At the Bellagio. Yeah.

Dave Young:

At the Bellagio. So, this mountain wasn’t just a mountain, it had a stream in it.

Stephen Semple:

Right.

Dave Young:

And so there’s water flowing and they made sure that there were places in the stores that you could actually touch and feel the sporting equipment. Some of the stores have shooting ranges, some have just other places, games, there’s a little shooting gallery in some of the stores. I think the one they built down here in Buda had that. So things that move, things that architecturally take your breath away, and generosity.

Oh, the other generous thing was, and this started in Sidney well before they had their big store, they would do a sidewalk sale every year. So remember, they’re sending out millions of catalogs and they’ve got a return policy that’s super generous. So they’re always going to get things returned to them. What happens to that stuff? What happens to the mountains of stuff that get returned? They store it all up-

Stephen Semple:

Oh, and then they do-

Dave Young:

And once a weekend in the summertime, they have the Cabela’s Sidewalk Sale. And in Sidney, Nebraska, it was an event.

Stephen Semple:

Right. So they’re selling all the stuff that’s been returned.

Dave Young:

Yeah, they set up a giant tent. It always just blew our minds because even in the days before the destination store, people would drive from everywhere and camp in line. This was before you could camp to buy tickets to a concert. People were getting their place in line a week in advance and they would watch the Cabela’s employees stock the tent. There were people that would sit in their tent or on their lawn chairs with binoculars.

Stephen Semple:

So they knew which tent that they wanted to go to.

Dave Young:

Watching the Cabela’s people stock it, and they’d know which tent they were going to go to get… And so there were huge bargains, huge. It would be a free for all. When they started letting people into the tent on that Saturday morning, it was just madness. And they moved that out to the store and then they also created a thing, their Bargain Cave in the store. So I think mostly the Bargain Cave was things that got returned to the store, not things that got returned to the catalog place, but there were always great deals to be had. They would mark things down, let’s just get this out of the store kind of prices.

Stephen Semple:

So the thing I don’t want to lose sight of this is the one that to me is really super interesting, is going back to that first offer, because it would’ve been very easy, it could have been very, very, very easy to go, “Okay, they’re not selling for a dollar. Let me try 50 cents.” Not, “I’m just going to change the way the dollar changes hands.” That shows a real testing of offer because what I find a lot of times is the offer doesn’t work, we’re really quick to go, “Well, that’s a bad idea.” Not just changing how I word it, changing how the offer is put together can have a huge, huge, huge impact. And offers are weird. They really require testing and massaging and sometimes going back at it and recognizing that, yeah, does it make sense? Does it not make sense changing the dollar from this category to this category has an impact? But it does. And so that’s my hats off to them in terms of having the boldness to just go back at the market and just change it.

Dave Young:

Well, and you think about the millions of products and millions of catalog, pieces of copy that they had to write. There were some great copywriters in that company and I tell people, “Look, I’m the only guy in Sidney, Nebraska that never worked for them,” but huge respect for how the company was built.

And another episode would be what happened to… So to fund the growth and to build these big destination stores, they went public. And that eventually is what led to the downfall of them as a company. They’re still a brand, but as a company, they don’t really exist anymore.

Stephen Semple:

We could certainly explore that. But the amazing thing is that whole idea of this really creating the experience, attracting people, but that first copywriting experience, look, that shaped their copywriting through their entire catalog, that experience.

Dave Young:

Yeah. It’s all about the offer. All about the offer.

Stephen Semple:

All about the offer. Yeah. That’s cool. Thanks for sharing this story, Dave.

Dave Young:

Yeah, I love talking about Cabela’s.

Stephen Semple:

Yeah. It’s an amazing, amazing, amazing history there. Thanks, David.

Dave Young:

Thanks for listening to the podcast. Please share us, subscribe on your favorite podcast app, and leave us a big fat juicy five star rating and review at Apple Podcasts. And if you’d like to schedule your own 90-minute Empire Building session, you can do it at empirebuildingprogram.com.