Dick’s Sporting Goods launching concept store as competition heats up with Nike and other big brands

Dick’s Sporting Goods Inc.
said Monday that it is launching a new concept store, Dick’s House of Sport, in Victor, NY on April 9.

Featuring a 17,000-square-foot outdoor turf field, a rock-climbing wall, batting cage, health-and-wellness section to help those recovering from injury, and more, the store has a focus on experiences.

A second House of Sport will open in Knoxville, TN later this year.

Experiential Dick’s Soccer Shops are coming to select locations starting April 5. The Soccer Shops will offer service from associates with sales expertise in the sport and its equipment, an upgraded cleat shop and more.

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Dick’s has redesigned its Golf Galaxy locations to provide custom fitting, hitting bays and access to advanced golf technologies.

And Dick’s is also adding two Warehouse Sale locations, offering deep discounts.

With its new stores, Dick’s will have 730 locations in 47 states.

The latest enhancements come as some of the biggest names in the athletic category are increasingly making moves to sell in-demand merchandise directly to consumers.

EMarketer estimates that direct-to-consumer e-commerce sales will reach nearly $175 billion by 2023, up from $76.7 billion in 2019.

Baird noted in a March 26 upgrade of Nike Inc.
that the next phase of the company’s “Consumer Direct Offense” strategy will include 150-to-200 small-format stores in the U.S. and Europe and technology investments that improve seamless transactions between stores and its digital channels.

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“Direct-to-consumer/digital also is margin accretive today and should drive further expansion especially at greater scale in the coming years,” analysts said.

Baird rates Nike stock as outperform with a $150 price target.

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And Adidas AG
just launched a new collaboration with rapper Bad Bunny that requires a download of the company’s Confirmed app to purchase. The app features collaborations with other big names like Pharrell and Prada.

In a Stifel athletic report for late February and early March, analysts found that product shipment delays had driven inventory shortages at a number of retailers. Meanwhile, demand spiked due to tax refunds and the NBA All-Star Game.

“Store inventories are severely depleted, popular product scarcity is palpable in conversations with store employees, and consumers are turning to digital channels for the best availability,” analysts said.

“This scarcity dynamic, we believe, is perpetuating both consumer appetite for in-demand styles and adoption of digital channels. App data suggests that this acceleration towards digital has favored Nike, with SNKRS app daily average users increasing 139% year-over-year.”

In its most recent earnings report on March 9, Dick’s said its capital allocation plan includes $275 million to $300 million in spending focused on stores, including the concept store, and technology investments.

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Stores fulfilled more than 70% of the retailer’s fourth-quarter online sales, and the company says it’s focused on the overall customer experience, whether digital or in-store.

Dick’s stock has jumped nearly 30% over the past three months, and has soared 263% over the last year.

The benchmark S&P 500 index
is up 53.1% over the past 12 months.

View more information: https://www.marketwatch.com/story/dicks-sporting-goods-launching-concept-store-as-competition-heats-up-with-nike-and-other-big-brands-11617636127

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