Dive Brief:
- Dick’s Sporting Goods reported its second consecutive record year in 2021, with net sales last year surging 40.5% over 2019 and 28.3% against 2020 to reach $12.3 billion, according to a company press release.
- Comps were up 26.5% in 2021, including a 42% increase in brick and mortar and a 9% decrease in e-commerce. E-commerce is normalizing: Pandemic trends pushed the retailer to double its e-commerce sales the year before, with penetration hitting 30% in 2020, but e-commerce as a percent of sales was down to 21% in 2021.
- Thanks to strong sales and margins, Dick’s net income also soared, growing 325% over 2019 and 157% over last year, to $1.54 billion. On the back of two years of strong performance, however, expectations for 2022 are lower, with comps predicted to be down 4% to flat, and earnings per share about $2 to $4 less than 2021.
Dive Insight:
After five years of transformation work, Dick’s has posted two back-to-back record years and in the fourth quarter, its largest sales quarter in the company’s history.
“Virtually nothing about our business is the same as it was five years ago,” Executive Chairman Ed Stack said on a call with analysts, noting the retailer continues to take market share and evolve its business.
Its go-ahead strategy, however, is very similar to the past year. The company will continue to invest in in-store experience, including technology to improve in-store fulfillment and pickup capabilities, full-service footwear stations, more fleshed out soccer shops, golf simulators and batting cages at its stores. Executives have been “very pleased” with the store concepts Dick’s has been testing — House of Sport, Public Lands and off-price concept Going, Going, Gone all debuted last year — and they will continue to influence what Dick’s does in its core stores as well.
After fellow athletics retailer Foot Locker announced it would be receiving less product from Nike going forward, Dick’s CEO Lauren Hobart touted its relationship with Nike, saying it’s been “encouraged” by the results of tying the two companies’ loyalty programs together.
“Our relationship with Nike is at an all-time high,” Hobart said, saying it’s become an “incredibly strategic” partnership.
However, she also highlighted strong relationships with brands like Under Armour and Adidas, and noted that Nike made up 17% of its sales last year. By comparison, Nike made up 70% of Foot Locker’s purchases in 2021.
“We are having incredibly strategic discussions with every key brand partner we have in key categories and that’s across athletic apparel, athletic footwear [and] team sports,” Hobart said.
At the same time, the retailer is continuing to grow private labels to fill gaps in its assortment and plans to expand its private labels into new categories going forward. In 2021, private labels at Dick’s made up more than $1.7 billion in sales, and represented the company’s largest brands in categories including golf, team sports and fitness.
