Nike, Dick’s Cross-Channel Strategies Increase Sales

As retail sales overall plummet, some sporting goods brands and retailers are showing that health and wellness is anything but arbitrary.

Seamless integration of online tools and technology coupled with savvy in-store selling is proving remarkably successful for sporting goods brands that strike the right innovative balance. These cross-channel approaches to selling sporting goods and apparel align with already established consumer behaviors, as noted in the PYMNTS report, 12 Months of the ConnectedEconomy™.

The above data shows that consumers are relatively likely to shop both online and in-store at 88% and 64%, respectively. Therefore, in order for brands and retailers to get the most out of their potential customer base, it seems clear that cross-channel strategies are essential. For the sporting goods and apparel sector, some of these approaches have been more successful than others.

One retailer that has gotten it “right” so far has been Dick’s Sporting Goods, as evidenced by its 6.5% increase in sales in the third quarter of 2022. Ed Stack, the company’s CEO, attributes this growth directly to the “best-in-class, omnichannel ecosystem.”

Dick’s digital transformation was multifaceted, yet each cross-channel offering rolled out with remarkable speed. Since last September, the retailer has been working with DoorDash, allowing its customers to opt for same-day delivery by ordering through the DoorDash platform. Weeks later, Dick’s announced a partnership with Peleton to open 100 branded store-in-stores with the affiliated training company.

Dick’s growth has continued to climb since, with same-store sales up 5.3% in the fourth quarter of 2022, beating analysts’ forecasts. Led by purchases of footwear, athletic apparel and team sport products, Dick’s ended the quarter with record sales of $3.6 billion.

Nike is another well-known name that has found success with a hybrid approach that includes a direct-to-consumer (D2C) sales strategy. After the company’s stock fell by half in 2021 and 2022, drastic changes were needed if the 50-year-old brand was to have any chance of survival.

Nike focused on its D2C and go-to-market launches and continued to advance its plans for digital innovation, distribution changes and new retail concepts. The fruits of those efforts were rewarded this past December, however, when Nike’s digital business grew 34% in the second quarter of 2022.

The company attributed this growth to “investing in discounts” and using these promotions to attract new members and increase sales, along with its other D2C strategies. As with Dick’s Sporting Goods, Nike’s success continued into the following quarter, as the company reported third-quarter sales were expected to be $12.4 billion, up 14% year over year and ahead of guidance. Notably, digital sales for the Nike brand are up 20% year over year.

Some retailers like Foot Locker appear to have had more moderate but steady success with their cross-channel sales efforts. Targeting customers seeking a fun shopping experience drove the company’s sneaker sales and delivered better-than-expected results in the third quarter of 2022. Total sales increased 3.3% year-on-year at constant exchange rates and comparable-store sales increased 0.8% over the same period. While this growth wasn’t nearly as dramatic as at Dick’s or Nike, this growth came at a time when overall retail sales have been falling, meaning that 0.8% represents a significant outperformance.

The company has also been exploring the D2C space, partnering with Fanatics last August. Under the deal, Foot Locker will be responsible for front-end operations and Fanatics will fulfill those orders across a range of licensed merchandise in sports leagues such as the MLB and NFL.

The growth of these three brands shows that applying the right strategies in the right markets at the right time can help even the most vulnerable businesses in tough economic times.