Retailer sees itself as an embodiment of national values that must also keep up with the times, strategist says
Publishing date:
Oct 17, 2022 • 18 hours ago • 5 minute read • 56 Comments
Canadian Tire signage at a store in Oakville, Ont. Photo by Peter J. Thompson/National Post The stampede of sponsors running away from Hockey Canada last week was a vivid display of the value corporations place on hockey, the most popular of the country’s two national sports.
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As the negative press surrounding Hockey Canada’s handling of sexual assault allegations mounted, the list of famous companies seeking to create distance grew longer and longer: Bank of Nova Scotia, Canada’s third-biggest bank; Telus Corp., the country’s third-biggest telecommunications provider; Restaurant Brands International Inc.’s Tim Hortons, the ubiquitous coffee and doughnut chain; Imperial Oil Ltd.’s gasoline retailer Esso; Empire Co. Ltd.’s Sobeys, one of the country’s biggest grocers; and General Motors Co.’s Chevrolet all were among the chorus of admonishers.
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However, one big-name sponsor sang louder than the others. While most companies hedged their bets on Hockey Canada by “pausing” funding, or insisting that their sponsorship dollars could be used only to support women’s teams, Canadian Tire Corp., the century-old purveyor of skates and hockey sticks, stood out by making a clean break, declaring that it was severing all ties with Hockey Canada.
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“In our view, Hockey Canada continues to resist meaningful change and we can no longer confidently move forward together,” senior vice-president of communications Jane Shaw said in a statement on Oct. 6.
Canadian Tire chief executive Greg Hicks could have stuck with the pack by hitting the pause button, wait for the storm to blow over and then resume working with Hockey Canada, the organization responsible for assembling the national teams that attract millions of viewers whenever they play televised games.
A woman exits a Canadian Tire store in Toronto. Photo by Peter J. Thompson/National Post But that’s not what he did. The decision to take a harder line offered a glimpse at how one of Canada’s biggest retailers has evolved beyond its stereotype as a store for guys, said Lisa Hutcheson, a retail consultant and strategist. A company that is “part of the cultural fabric of Canada” appears to have taken that responsibility seriously, accepting that if it sees itself an embodiment of national values, then it must also keep up with the times, Hutcheson said.
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“They’ve been making a real effort to move beyond that stereotype of the guy that shops for tires and some sporting goods and they’ve really been focusing on looking at how to attract the female customer,” Hutcheson said. “With a brand purpose of ‘making life in Canada better,’ that directly conflicts with supporting an organization that has some not-so-good stuff going on right now.”
Heritage business Canadian Tire arguably had more at stake than other big sponsors of Hockey Canada, given its deeply intertwined relationship with the sport, said Bruce Winder, a retail analyst and author. “Canadian Tire and hockey are synonymous,” Winder said. “When you think of Canadian Tire, you think of hockey and vice versa.”
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Article content Canadian Tire began selling sports equipment in 1935, and it went full-steam into hockey in the 2010s.
When former CEO Michael Medline bought high-end equipment retailer Pro Hockey Life for $85 million in 2012, he described hockey as a “heritage business” that would support his strategy to become “the authority in sports in Canada from a retail perspective.”
A year prior, Medline had purchased Foranzi Group Ltd., owner of the SportChek and Atmosphere sporting goods chains. And in 2010, it had signed a five-year deal with the National Hockey League to be the league’s official sporting goods retailer and an official partner of the All-Star games and Stanley Cup playoffs. The company also launched the Canadian Tire Hockey School, a series of camps led by NHL athletes for younger players.
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Article content Participants in the Canadian Tire Hockey School in Ottawa, in 2010. Photo by Darren Brown/Ottawa Sun files In 2013, it partnered with the national Olympic and Paralympic committees. That same year, Canadian Tire purchased the naming rights to the Ottawa Senators’ arena.
All those ties to hockey meant Canadian Tire risked becoming tarnished by the fallout from the Hockey Canada controversy, said Winder. At the same time it cut ties with Hockey Canada, Canadian Tire announced that it would back Respect Group Inc., the group co-founded by former professional player Sheldon Kennedy to prevent bullying, abuse, harassment and discrimination.
“Canadian Tire had to get out there first and condemn it because (hockey) is such an important part of their business and their DNA,” Winder said. “If they didn’t, then they would risk losing that whole franchise.”
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Article content ‘Making a stand’ Canadian Tire’s stock price has plunged 29 per cent since it peaked in May 2021, adding pressure on Hicks to get things right. The company managed to increase sales in its most recent quarter, but profits slid amid the fastest inflation in four decades and a shift in consumer spending habits to online shopping from browsing physical stores.
Canadian Tire permanently cuts ties with Hockey Canada over sexual assault allegations Heavyweight sponsors distance themselves from Hockey Canada amid sexual assault scandal ‘They didn’t game it out:’ CCM Hockey’s debacle over its Russian players shows there’s no hiding from politics So, in deciding how to respond to the Hockey Canada fallout, the company also likely considered the sport’s growing popularity among girls and women. In 2020, there were nearly 102,000 female players, a 30-per-cent increase from 2008, according to Hockey Canada data, while the participation of boys and men has plateaued.
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It’s particularly important for the retailer to maintain its status as a steward of Canadian values and a positive relationship with the sport with which most Canadians identify because that identity is what differentiates the company from competitors such as Walmart Inc. and Amazon.com Inc., Winder said. And since it’s trying to expand its consumer base to include more women — offering furniture, decor and household items — an organization that doesn’t appear to side with women who’ve experienced sexual violence is practically radioactive, he added.
Recently, the company has centred its purpose around “making life better in Canada,” and unveiled more than $3 billion in investment to improve its online and in-store business. It’s done relatively well through the pandemic, posting year-over-year growth in 2020 and 2021, and Hutcheson said the company did not want to allow the scandal to dent its growth.
“(Canadian Tire is) making a stand to say this doesn’t align with who we are and who we want to be associated with,” Hutcheson said. “It makes crystal clear what their brand is about.”
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