Sports Authority Is Selling An Extended Warranty For Shoes

Sports Authority is pushing a new “Extended Coverage Plan” for footwear that runs for one year after Sports Authority’s 30-day warranty expires. The extended warranty, which costs between $4.99 and $15.99, supposedly even covers normal wear and tear. So how is this profitable?

Sports Authority associates tell us that most people simply forget they have the extended warranty, which we find hard to believe. When we asked what would happen if we requested a new pair after cutting the tongues off our shoes for an art project, we were told that “managers have been very lenient.”

Sports Authority associate Taylor Smith writes on his blog that the warranties are part of a new corporate effort to upsell extras:

i sell shoes and we have this “Operation Big Foot” thing that just started in February 2009… we are supposed to basically ANNOY the customer by trying to persuade them to purchase an “ECP” aka Extended Coverage Plan, Insoles, shoe cleaner, sneaker balls (deodorizer), heart rate monitors watches, socks and any other product that we offer.

It gets so redundant throughout the day but the up side is we get a little money for each thing we sell. Like if i were to sell you an insole that costs $19.99-29.99 each i would get $1. If i sell you an ECP and your shoes cost $79.99 your ECP would cost $9.99 and i would get $.50 but if your shoes cost over $100.01 then the ECP would cost $15.99, and i would get a buck!

The extended warranty is administered by the National Electronics Warranty Corporation, which has several complaints against it on RipOffReport.

We distrust most extended warranties. A warranty on shoes that including wear and tear seems to good to be true, which means that it probably is.

Consumer Portal [National Electronics Warranty Corporation]

Comments

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  1. Coles_Law says:

    Wait-many athletic shoes last less than a year. Something about this doesn’t make sense, and I’m having trouble finding their full terms and conditions.

  2. Quatre707 says:

    Just buy the shoes from Khol’s and return them when they fall apart 4 months down the road.

    • Hands says:

      @Quatre707: Mine don’t fall apart; I just wear them out after six months. Unfortunately, I buy four pair at a time and more when they’re on sale. Right now I have about five years worth of shoes patiently waiting for me.

    • JRam says:

      @Quatre707: SO it is you returning those shoes. We have people returning shoes that just “fall apart”. They are shoes that are abused. If you let your kids run through mud they are going to fall apart. An sadly we will take any thing back no matter the condition with receipt.

      • Pyrusticia says:

        @JRam: “If you let your kids run through mud they are going to fall apart.”

        …why? Running through mud (and snow, and grass, and dirt, etc) is part of being a kid. I did it. None of my shoes fell apart. If the shoes you sell fall apart upon contact with mud, that’s a problem with the shoe. It’s not ‘abuse’.

  3. PLATTWORX says:

    Sports Authority has been not exactly a star in retailing for a long time. The store near me sits with it’s back to a highway (smart design!) and barely ever has more than 5 car in the parking lot.

    I see they are trying to pad their bank book a little by tricking customers. Never wise. Any sales person that “ANNOYS” me gets no sale.

    I appreciate this story, I will avoid their store now!

    • OMG! Con Seannery! says:

      @PLATTWORX: Mine has what I like to call K-Mart Syndrome, albeit a mild case. When I go in, it seems dirty, dim, dated, and generally makes me feel like I walked into 1996. It gives me that feeling that something isn’t quite right, like you get in a house that just got burglarized. The place feels like it got robbed. The only thing setting it apart from K-Mart is the lack of the tight, narrow, almost lightless aisles and the creepily abandoned Little Cesar’s Pizza that makes you expect a rape/murder behind the dusty table stacks.

  4. Shoelace says:

    I’m sure the answer is in the small print. Perhaps they’ll give you fresh insoles for normal wear and a sewing kit for normal tear. More likely, they have a substantially different idea of what ‘normal wear and tear’ is than their customer, come warranty replacement time.

  5. Neurotic1 says:

    yeah, there’s gotta be a catch. I go through running shoes fast and need replacements after about 3months, as most runners, so this would be a money loser if it’s as stated.

  6. MonkeyMonk says:

    I’m a pretty avid platform tennis player and the rough surface of the courts eats completely through the soles of a normal pair of tennis shoes in about 3-4 months. I could see this warranty being a *very* good deal as long as Sports Authority plays square with the warranty-holder.

    • ryohazuki222 says:

      @MonkeyMonk: Try playing real tennis at a good level of competition.

      I used to wear normal shoes it in a few weeks. In a month, they were unplayable by any standard. When I started buying REAL tennis shoes…. they started lasting 1-2 months. With an additional few bonus weeks until being unplayable. It’s common in tennis that shoes come with sole durability guarantees. And most reputable shoes warranty the shoe from other types of screw ups.

      So you can spend anywhere from $50 up to $110 (for the premium top of the line models) for a shoe that will last you a handful of months guaranteed.

      They’re obviously still making money. This is hardly I new business model……

      • biswalt says:

        OMG! Con Seannery!: Why would you expect a murder in the little caesar’s, you can see in that! The place to expect the rape/murder is the narrow dimly lit aisles. They provide that sense of the alley that the criminal element feels so at home in.

  7. visualbowler says:

    I have a really hard trusting warranties anymore. The only one I ever buy now is warranties from Squaretrade and ive never had a problem.

  8. ajlei says:

    Man, reading the comments I had no idea shoes could wear out so quickly! I’ve had my Pumas for a year and a half and they’re still quite wearable. Although, I don’t do any serious exercise in them, maybe that’s why… anyway, this warranty sounds too good to be true.

    • biswalt says:

      I work for a very high end shoe store. Most athletic shoes are designed to wear out in about 6 months. The reason for this is most sneaker style shoes are made with Ethylene Vinyl Acetate, which is good because it’s a material that provides superior shock absorbition. But under normal wear and tear by a reasonably active person there will be about 6 months of use before either the rubber at the heel wears down, or the foam suffers so much compression that it doesn’t provide enough shock absobtion anymore.

      I predict one of two things. One, SA will make it incredibly hard to return products, ie. normal wear and tear is fine, but must have original box and receipt. Or two and more likely, this will be an incredibly costly endevour and will be short lived.

      The place wear I work, small but very high end shoe store will laugh their asses off about this. No way you can run a profitable shoe store or department with stuff like this. You’d perpetually be running out of shoes and never turning more than the 10 dollar warranty fee.

  9. Ronin-Democrat says:

    Ok consumerist DO SOMETHING.
    Buy a few pairs of sneakers let a dog maul one pair, water damage another and cook the third in an oven and see what happens when you return them.

  10. Ronin-Democrat says:

    Of course use undercover video in the above exercise.

  11. tom2133 says:

    The last time I went to buy some shoes, I went to the running store. After being ignored for 10 minutes, I walked over the the Sports Authority that is in the same shopping center and got some service right away.

    I didn’t get hounded for an extended warranty on my shoes. I did however receive some really good service from a sales person on some good running shoes. He encouraged some insoles (which really helped out) but he didn’t come on too strong.

    I think some Sports Authority stores are hit and miss service wise though. I think it depends on the sales culture that management has. The stores in my area used to be Gart Brothers locations, so I think that some of the old Gart Brothers sales standards and procedures are still evident even in some of the new stores that never had Gart Brothers on the building (district management, maybe?)

  12. bornonbord says:

    WTF? What will the guy from the wall street journal say?

    As stated in the article (and as a triathlete, I can attest to)
    Four months for a running shoe was ancient, they said. Some customers bought shoes every month.

    [consumerist.com]

  13. henwy says:

    LL Bean has a lifetime warranty on things they sell. My sister bought me a pair of shoes that I wore every day for well over a year and basically beat the hell out of. When it finally started falling apart, I thought about just sending them in for a new pair, but my sister balked. Her feeling was the shoes had been great quality and the company had more than fulfilled their obligation. There was no reason to take advantage of the warranty and it was better to just buy another pair, supporting them.

    • perryw says:

      @henwy: Yes, the idea is that if the shoes wear out and you feel that they have served you well, then be happy. If, however, you feel that the shoes shouldn’t have worn out and are unhappy with that, then LL Bean will want you to return them. They don’t want you to have anything from them that you are not happy with. I haven’t had to use that on items from them, but I have with Lands End – took back some jeans that started fraying after a couple months (yes, I know some people pay extra for that!).

  14. Gilbert Tang, Jr. says:

    From a consumer standpoint, I am a huge, huge opponent of incentives for salespeople in concert with products such as these.

    • DogiiKurugaa says:

      @Gilbert: I am too, though if they were to institute a penalty for every customer complaint from being harassed about such things then it might be fair. Makes them know when to shut up when you say no and maybe actually give good suggestions instead of just trying to upsell for the sake of upselling.

      • dragonfire81 says:

        @DogiiKurugaa: I used to work at a store that expected to upsell like crazy WITHOUT incentives. Basically their idea was “upsell like you’re supposed to or find another job.”

        I would have preferred a commission.

  15. temporaryerror says:

    I’ve found that you can make a very effective “odor eater” for your shoes by filling a sock with fresh cat litter and tieing the open ends off. Then just leave it in your shoe overnight. Works great, and is practically free.

    • HogwartsAlum says:

      @temporaryerror:

      I need to do that with my skates. You can buy these little stuffed animals full of peppermint or something to stick in them, but they’re expensive.

      I’m going to try it with the suitcase I carry them in, too.

  16. balthisar says:

    Wow, those incentives are pretty crappy. You get 50¬¢ to a buck? You’d have to sell 100 of those per day to make it worth your self-respect, I’d think.

    And what’s the retail margin on sports shoes? All of the non-blingy shoes cost $100 bucks and up. Granted, the real margins go to the manufacturer, but really, what’s the retail margin?

    Next question, obviously, what’s the manufacturer’s margin? And what would it be without all of the advertising?

    • biswalt says:

      @balthisar: Shoes have a pretty low margin basically enough to cover the cost of ordering a replacement pair of shoes plus about $10 – $20 of “profit” to pay bills, employees, upkeep the store, and remainder is pure profit. Most cities have several shoe stores, shoe companies sell to many different retailers, so it’s not like a company can really claim a stake in a unique position given that nearly all athletic shoe stores will offer similar experiences and price points. Now dress shoes which are made in more limited runs and hence don’t ship out to as many distributors are able to keep a much better profit margin.

  17. hahamaximus says:

    A friend worked for Shoe Carnival and told me their return policy is almost as liberal as L.L. Bean.. provided you have a receipt. This was several years ago, don’t know if this still applies in the current economic climate, but might come in handy.

  18. henrygates says:

    Back when I was working for a big box electronics store and the warranty boom began, that’s how they treated the terms at first also. You could exchange it for any reason as long as you had the warranty. Then as people got used to the terms, the policies changed and you couldn’t get them exchange it for anything!

    Salesmen were specifically told to avoid telling the customer that there were more restrictions.

    • dragonfire81 says:

      @henrygates: Yeah I’ve had that before. My manager told me clearly that the warranty does not cover certain things but then I saw her sell one to a customer telling them that it “covered anything that could happen”.

  19. rpm773 says:

    What’s written in the grey inset is a great sampling of why I really don’t shop in retail stores that much anymore.

    • dragonfire81 says:

      @rpm773: Yeah but if you happen to need something really quick there’s little choice. You can’t always wait a day or two for something to ship.

  20. Anonymous says:

    They can do it because the most common shoe they probably sell are running shoes. Since many people plan to run, but less willing to actually DO the running regularly, the shoes end up sitting in the closet for most of the year and in perfect condition when the warranty expires.

  21. usmcmoran says:

    Sports Authority is usually hit or miss for me as well, I did buy a pair of sunglasses for 70 bucks and bought the warranty for 10. the glasses got scratched and I brought them back. They called the warranty place for me while I waited, gave me a new pair of glasses under the warranty plan no questions asked and let me buy the warranty again on the new glasses for 10 bucks. I am not big into warranties, esecially on things I often lose but this time it has worked out. I am in Iraq and the new pair is getting scratched up so I will be returning these when i get back.

  22. KenComputerGuy says:

    This makes total sense actually. Most people really *do* forget that they have extended warranties, or warranties at all, or they decide it’s too much hassle to exercise their warranty rights. In a lot of cases they’re right – it really is too much hassle – but with 3rd-party-administered extended warranties, the economics changes. 99% of the time, upsell warranties are pure profit for the retailer. It’s only 1% of the time that they meet a guy like me, who is GUARANTEED to know and exercise his warranty rights! :-)

  23. snowburnt says:

    I noticed this yesterday and it wasn’t the sports authority. I went to Finish Line and my wife went to Lady Foot Locker, both stores were much pushier than before about accessories. both had buy one get one socks that they insist you try on, both forced you to try their insoles (which made things worse), both shoved paperwork in your face for reward cards.

    I hadn’t been to the mall in a few months, but all the stores we went to seemed like this, very pushy, we got offered a credit card a baby gap…this was normal, but when we refused the sales person went on for another 5 minutes about how much money we will be saving on a daily, monthly and yearly basis based on how much we just spent.

  24. thrashanddestroy says:

    Wait, people still buy shoes from anyone other than Zappos? That’s SO 2002!

    • johnfrombrooklyn says:

      @thrashanddestroy: Why would anyone buy shoes online without trying them on first? Unless you’re just buying a model that you already own so you can buy the same model and the same size. I try on 10-15 pairs of running shoes before I pick the one for me. I’m certainly not going to do that online.

      • thrashanddestroy says:

        @johnfrombrooklyn: Well, I typically know the exact size I wear in several different brands. On the off chance that I don’t own a pair of said brand I’m looking to purchase online, I just hit up a brick and mortar and try those suckers on.

        Easy peasy.

  25. Nick Reuter says:

    So this works for me. I bought the warranty, training for a marathon, blew through my shoes, and then got a new pair. I replace shoes every 4-6 months so this was pretty much a no-brainer.

  26. synergy says:

    Sports Authority, in general, sucks.

  27. bizzz says:

    As I recall, Nordstroms used to have a very liberal return policy for shoes. Not sure if they still do, but there were many stories of people bringing back well worn shoes years after purchase for either a full refund or store credit. I don’t even thing a receipt was required.

    They seemed to get a lot of good rep from the policy, and it didn’t cost anything above the price of the shoes.

  28. BreadBoy says:

    Funny, I bought a new pair of NewBalance shoes @ Sports Authority yesterday, and noticed the extended warranty information on the counter. I thought it was strange, plus I am very skeptical of extended warranty plans. I declined it.

  29. West Coast Secessionist says:

    I used to sell NEW warranties at a major department store, for jewelry, and we never had a warranty repair get denied by the warranty administrator. I always recommended it because it was worth a few extra bucks to know that your jewelry, if it became damaged or worn, would be repaired or replaced for free. My “attach rate” for this was over 30%.

    The “worst” thing that ever happened to our customers would be that the warranty company would “Buy out” the item — meaning the customer gets back the full purchase price they paid for the piece. This sometimes happened when the customer got a really good deal on a piece and the damage was severe. On the other hand, sometimes folks who didn’t buy the care plan would return after 90 days and find out that repairs could be quite costly.

    So I don’t think NEW is evil or a ripoff.

    If I were buying sneakers, I don’t think I’d bother with it, but that’s just me. It might work out well for people who are hard on shoes.

  30. Anonymous says:

    I’ve worked at Sports Authority for about 5 years now in the footwear department and i even though i hate to pressure customers to buy these extended coverages, overall it’s a good deal, I sometimes tell my customers straight up that if you wanted to you could cut the eyelets of the shoes when you want a new pair and they will send you a check. Even if the company that backs the warranty refuses to send you a check all you need to do is bring them into the store and a Manager will ALWAYS allow you to exchange them if you bought the coverage plan.

    So in these hard economic times, it’s always nice to have a new pair of shoes every year for only 5 dollars.

  31. Anonymous says:

    I have been at The Sports Authority for awhile now and work in the footwear section, this ecp is a good idea for people who run or train a lot. We make sure the customer knows that they should always contact the NEW company first, but if anything goes wrong we always will take them back in the store as long as they have their receipt. The only complaint I have had is that the NEW company will sometimes ask for you to send the shoes to them, and most customers feel it is to much of a pain, if that happens they come back in and get a new pair from us regardless. Don’t always knock on coverage plans because companies are willing to work with the customers always.

  32. RossK says:

    I work at Sports Authority. Yes the offer seems to be too good to be true, but it really works. I bought the warranty on my girlfriend’s tennis shoes. I called NEW because she wore through them quickly, and I got a new pair of shoes. Its really not a bad idea. The idea was not some massive money making scheme, but to drive sales in footwear and help customer service. I can tell you, I know people who only sell because of the incentive, but more times than not, we’re only selling to help the customer out. I mean most of us buy the warranties too. Plus, it’s true. $.50 more is not a whole lot. We just want to help the customer out. Thats our main goal.

  33. IntheKnow says:

    What they say is covered in the body of the booklet “sole separation, seam rips and fabric discoloration and broken fasteners “are things that if you read the exclusions, “excessive wear, wear holes, lacerations, damage caused by exposure to water, sole separation, color bleeding” are ALL EXCLUSIONS in the fine print! Who’s kidding who? How can you not avoid exposure to water at some point! If it doesn’t cover excessive wear or wear holes, then WHAT!
    This is all meant to deceive – and not based on some mind-blowing consumer research concluding that this type of service was in some demand.

    Granted, customers may get satisfied otherwise and regardless of what the booklet says. The expectation is that you forget you purchased this.

    • Runner Guy says:

      I have spent several hours searching the internet trying to find complaints from people who bought one of these plans, made a claim, and were denied. I have not found a single one. However, I have found numerous reports of people making claims and receiving a gift card – as promised.

      If this was such a bad deal or complete ripoff as some are stating here, where are the complaints? If you or anyone else has evidence of people being denied when they make a claim, please present it.

  34. Runner Guy says:

    OK, from my research it appears people have been able to use this plan to return the shoes for almost any reason. Has anyone ever been denied and told their problem wasn’t covered? I have read about people who have returned shoes as many as 6 times already using this plan. Dick’s Sporting Goods sells almost the exact same plan as well and I can’t find any complaints about people’s claims being denied from either sports chain anywhere on the internet even though between the two chains they’ve probably sold at least a half million of these plans.

    It seems if a person buys some decent running shoes ($80-$130) plus the plan, plus shipping to return the shoes to the warranty company, and is able to simply return the shoes when they wear out every time for the cost of a new plan and shipping – that eventually the original cost will be spread out over many pairs and make the average cost quite low. People who can think long term like this are apparently being rewarded with a great deal – or they were if the plans are no longer available.

    I doubt TSA or Dick’s loses anything on this deal. More than likely they are just selling a 3rd party plan and that’s where they make their money. The loser would be NEW, who provides the actual coverage. TSA probably gets 60-80% of the sale price selling something that costs them nothing. That’s why they push their employees to sell this. This is free money to the sports chains. NEW is on the line for the refunds and they hope people forgot they bought the plan or that people mistakenly think their problems are excluded. Look at the coverage. Fabric discoloration is something that happens to almost every shoe. Wear it in the dirt a few times and it’s discolored.

    The only way this would be a bad deal is if NEW is/was denying lots of claims. Nothing I’ve read here or anywhere on the internet indicates that to be true. It may be a bit of a hassle to ship the shoe and wait for the gift card, but long term the customer seems to be getting a great deal.

  35. tom k says:

    While my wife was in another part of the store, a Chula Vista, CA Sports Authority cashier persuaded my 12-yr-old son to buy an extended warranty on a soccer ball. Disgusting to take advantage of a kid with birthday money.