Dick’s Sporting Goods Investing in Technology Amid Uncertainty
DICK'S Sporting Goods CEO Edward W. Stack said while the retailer is slowing down its new store growth, it will continue to invest in technology.
"Although the business environment of 2020 remains uncertain, DICK'S Sporting Goods is in a position of strength,” said Stack. “We believe coming out of the current crisis, health and fitness will become even more important to the consumer. As the leader in the sporting goods retail sector, our relationships with key brands have never been stronger and we are in a great place to support this demand.”
The company has re-opened approximately 80% of its stores that were closed due to the coronavirus, as of May 30, 2020. However, Dick’s lost $1.21 a share on revenue of $1.33 billion, missing analysts’ forecast of an 83 cent per-share loss, with revenue of $1.3 billion, in its first quarter of 2020, which ended May 2.
Consolidated same store sales for the quarter decreased 29%, driven by the temporary store closures that started on March 18. However, e-commerce sales shot up 110%, including its new curbside pickup, compared to the first quarter of 2019.
As Dick’s closed stores, it executed its new curbside initiative within days, president Lauren Hobart said.
“Stores, e-commerce and technology teams quickly helped us pivot our business and ensure that we were able to provide our athletes with a safe and convenient way to pick up their orders, while reducing shipping and packaging expenses,” noted. “This is a great reflection of our culture and our nimble operating model, and a huge credit goes out to those teams.”
Curbside sales were up 1,000% since the service launched through the end of the quarter, when compared to BOPIS sales in the prior year. Curbside also accounted for over 40% of Dick’s total booming e-commerce sales during this time period.
“We believe this experience will continue to be a big opportunity for us as we move forward,” Hobart said.
Dick’s said curbside pickup and its e-commerce business continues to be very strong, even in the markets where the sporting goods retailer has reopened.
“As far as IT investments, we continue to invest in technology,” said Stack, which includes curbside pickup and footwear apps.
Some of Dick’s pushes for innovation will include the retailer looking at the entire customer experience, the entire customer journey, and how to provide more contactless experiences in the store when people are shopping.
“Whether that's our shoe runner app that we've tried right now where people can sort of self-help themselves, providing a ton of different opportunities there, mobile will be a big piece for us going forward,” Hobart said. “So, if anything, this has incredibly energized our innovation efforts and our technology teams behind the changing landscape.”