It’s highly probable that Leon Leonwood Bean would have ended his days as a partner in a small town men’s haberdashery were it not for his sore feet.
Born and bred in the Oxford hills of Maine, woody trails were no novelty to him. In fact, on a break from managing his brother’s store in Freeport, ME, and hiking those trails in 1911, “L.L.” decided he was tired of wearing shoes that hurt his feet. Back at the store, according to his 1960 autobiography, “I took a pair of shoe rubbers from the stock on the shelves and had a shoemaker cut out a pair of seven and a half-inch tops. The local cobbler stitched the whole thing together.”
The new hunting boots worked so well that Leon praised them to a friend, who ordered a pair. That friend’s praise caused Leon to order up a hundred pair for sale during the winter of 1912. The boots were both lightweight at 31 ounces, as well as waterproof. There was just one small problem: “The rubber was not strong enough to hold the ‘stitched on’ tops,” Bean recalled. Ninety of the first one hundred pairs of boots were returned as defective.
Most of us would view a product return rate of 90% as an unmitigated disaster and would run like hell to get out of that business. But “Crazy” Leon Bean gave every customer returning these defective boots a full cash refund — not store credit, not a make good — cash. Then he not only jumped back into the same business, he upped the shoe order!
And, truth be told, he had to up the order to solve the problem that was causing all the returns. “I borrowed $400 from my brother, Otho, and went to Boston to have the U.S. Rubber Company make a light rubber with a low heel, strong enough for attaching to leather tops. The kind of last I wanted was so expensive the company wanted a much larger order than I could afford. I went home and raised more money, and not too easily convinced [the family] that my shoe would be a winner.”
By the fall of 1912, L.L. Bean was selling the new “Maine hunting shoe” as a sideline to the family clothing store. His real genius was in how he publicized his new product. Beginning in 1903, the state of Maine required out-of-state hunters to purchase licenses. Bean managed to acquire this list from the state, thereby initiating one of the most efficient, if not the first, targeted direct mail programs. Maine followed up the out-of-state hunting license requirement with one for fishing licenses in 1917; hunting licenses for in-state residents became required in 1919. L.L. Bean followed right behind the state legislators with his mail-order catalogs, figuring quite correctly that behind every hunting and fishing license was a sportsman just like him — with sore feet.
Congress helped Bean immeasurably when it established domestic parcel post service in 1912. Surprisingly, the U.S. was the last industrialized nation to adopt this service. Previously, freight agents like Wells Fargo or Railway Express had handled mail order. It’s important to note that sending money through the mail still involved a tremendous leap of faith by consumers. While other companies like Sears & Roebuck and Montgomery Ward took a wait-and-see attitude toward the new service, Bean saw its possibilities and took immediate advantage of it.
By 1919, Bean’s mail-order operation had become so big that he moved his operation to a larger building in Freeport. Rather than build a luxurious new store on the ground floor of the new building, he put retail on the second floor and rented the first floor to the U.S. Post Office. He even gave some space to the USPS on the second floor, so that all his employees had to do to post a new order was to cross the aisle, thereby saving a fortune in transportation and warehousing.
If you think that’s Yankee ingenuity, you haven’t heard the half of it. Shortly after moving, Leon’s brother, Guy, was appointed postmaster of Freeport, with his office — you guessed it — right under his brother’s store. (Years later, Guy Bean would become the only postmaster in U.S. history to turn down federal funding for a new post office. Rather than move the post office to new digs, L.L. paid $25,000 out of his own pocket to improve the old one, thereby keeping it right where it was.)
For decades, the Bean store was the most unlikely center of a retail empire. Customers had to walk up an exposed outdoor staircase to get to the store, and then navigate a maze of desks and cubbyholes to get to the goods. But there was a method to Leon’s madness: why build a retail palace when 99% of the business was mail order. Plus, L.L. always felt that satisfaction was determined by his customers. If they didn’t like the store they’d tell him and he’d change it. They didn’t tell him, so he didn’t change it.
In those days, word of mouth was critical to a new business, particularly one so dependent on mail order, and especially one specializing in shoes. Bean’s extraordinary business ethics brought him new customers in droves, spurred on by word of mouth on his “incredible guarantee,” which has essentially stayed the same since it first appeared in the 1916 catalog:
NOTICE
I do not consider a sale complete until goods are worn out and the customer still satisfied. We will thank anyone to return goods that are not perfectly satisfactory. Should the person reading this notice know of anyone who is not satisfied with our goods, I will consider it a favor to be notified. Above all things, we wish to avoid having a dissatisfied customer.
One day, Bean was in the store when baseball great Ted Williams came in to return a fishing reel with which he wasn’t happy. “Will you have some of your men adjust this reel?” Williams asked. “Yes I’ll adjust it for you,” Bean responded, as he proceeded to throw the offending reel into a box in the corner. “Get him a new one,” he ordered a nearby clerk. Employees were adamant that Bean’s reaction would have been the same for any consumer.
The fact is L.L. Bean was genuinely surprised when any of his products failed, and went to great ends to ensure deficient products were corrected. To this day, returns are carefully monitored to determine if there are any emerging trends in customer comments about a particular item’s quality or fit.
When he died in 1967, L.L. Bean’s company employed 200 people and did $4 million dollars in sales. Since then, primarily under the stewardship of his grandson, Leon Gorman, L.L. Bean has grown to employ 3,800 full-time employees who generate $1.2 billion in sales.
“Crazy” Leon’s promise of a lifetime guarantee on all products redefined America’s notion of customer service. “Returns have stayed remarkably consistent over the years,” says Rich Donaldson, a Bean spokesman. “The real ‘ah-ha’ is that the majority of our customers are good, honest people who have both an emotional and intellectual relationship with our company.”
What an absolutely crazy way to run a business!
Rod Taylor is senior VP for promotion for CoActive, a marketing agency based in Cincinnati. He can be reached at [email protected].
Guarantees at a Glance
Spray n’ Wash
Texize introduced an aerosol spray designed to pre-treat laundry stains in 1968. Spray n’ Wash got off to a slow start until someone in marketing got the bright idea of promoting an incredible guarantee: If the product failed to remove a stain on any shirt, they’d pay for a new one. The product exploded off the shelf behind this new reason to believe and established the laundry pre-treatment category.
Brooks Brothers
This New York-based clothing chain, founded in 1818, also advertises an unconditional money- back guarantee, which explains why at least five generations of my family have shopped there. I once went to return a belt with a monogrammed sterling silver belt buckle that I’d received as a gift, expecting to have to fight World War III. I almost fell over when the clerk instantly asked me if I wanted cash or credit.
Nordstrom
Founded as a shoe store in 1901 in Seattle, Nordstrom’s has evolved to be one of the top clothing retailers in America, thanks in part to legendary customer service. The company likes to brag about the customer who retured two snow tires to one of their stores for a full and cheerful refund — while driving shoes are probably the closest thing Nordstrom’s has ever carried to automotive equipment!
Craftsman Tools
Sears guarantees its Craftsman line of tools for life, and has since 1927. I’ve never understood why anyone would buy tools from any other retailer. “If any craftsman guaranteed-forever hand tool fails to provide complete satisfaction, return it for free repair or replacement.” It’s rather surprising how rarely you get a chance to use this guarantee. The tools wear like hardened steel — because they are.
Network
