Omnichannel Athletes Make Sports and Fitness Spending a Top Priority

While consumers may be cutting back on discretionary expenses, they aren’t holding back when it comes to health and wellness — a trend that has continued since the start of the pandemic and a behavior Dick’s Sporting Goods says it is benefiting from.

“We’ve seen a shift in consumer behavior where they are prioritizing athletic endeavor sports, health and active lifestyle, and they’re prioritizing Dick’s in order to meet those needs,” Dick’s Sporting Goods CEO Lauren Hobart said on a call with analysts.

Hobart also noted that the retailer is seeing its consumers prioritize fitness even more than they did pre-pandemic. Shoppers are now starting to see sports and fitness products “more as necessities than discretionary,” she said.

Dick’s continued to gain market share at an accelerating pace, with considerable growth in its largest and most important categories, which include footwear, athletic apparel and team sports products. The sporting goods retailer wrapped up the fourth quarter with record quarterly sales of $3.6 billion, which was higher than the $3.45 billion analysts had expected. Meanwhile, same-store sales rose by 5.3%, more than twice analysts’ projections.

That said, the company reported a net income of $236 million, which was 32% lower than its results from the year before.

During the quarter, the company focused on building brand loyalty by leveraging data and making investments in technology to improve its omnichannel experiences. These efforts helped it better meet the changing needs of its customers while increasing sales.

“We continue to see growth in our omnichannel athletes who spend more with us and shop more frequently than single-channel athletes,” Hobart said.

The company also benefited from offering a wider assortment of products — an effort it believes will be a business driver for the foreseeable future.

Another strategy that has proven valuable for the Coraopolis, Pa.-based company has been its focus on delivering new in-store experiences like HitTrax and TrackMan, which aim to give customers confidence in their purchases.

Looking ahead, the company is hoping to build on its 2022 momentum by continuing to prioritize customers’ evolving needs and investing in its omnichannel experiences. It plans to offer a range of price points for its products, keeping in mind the needs of entry-level to enthusiast-level customers.

The move to cater to its athletes’ evolving preferences will be critical to Dick’s continued growth, as according to the PYMNTS 2023 Global Digital Shopping Index, 46% of global in-store shoppers have turned to their smartphones to enhance their most recent in-store shopping journey.

Furthermore, as in-person experiences come to the forefront of demand for consumers, the company will also be leveraging its existing physical presences but also expand to offer a contextual commerce experience in its physical retail location. The retailer is planning to open 20 Dick’s House of Sport concept stores, which offer experiences such as rock-climbing walls, batting cages and golf putting greens, according to CFO Navdeep Gupta.

The company’s shares closed 11% higher on Tuesday (March 7).