Nike sportswear can be seen on mannequins displayed at a Dick’s Sporting Goods store in Daly City, California.
David Paul Morris | Bloomberg | Getty Images
Nike and Dick’s Sporting Goods are stepping up efforts to work together at a time when a number of sportswear brands, including Nike, are less dependent on wholesale partners.
As a first step, Nike’s loyalty program will be linked to Dick’s membership offer to allow customers to purchase exclusive Nike shoes and clothing from Dick’s website, the companies said on Wednesday.
The partnership will evolve over time to include in-person training events at Dick’s sites. And both hinted at another perk that could come up: allowing Nike customers to drop off their returns or pick up their orders online at Dick’s stores.
For Nike, the move reinforces the sneaker giant’s commitment to Dick’s amid an industry upheaval.
Nike, along with peers such as Under Armor and Adidas, has proactively pulled merchandise out of wholesale channels, including low-cost stores and other shoe retailers, in an effort to sell more products directly. to customers at higher prices. It’s also an effort to build closer relationships with consumers and to better understand exactly what products they want.
Nike does not break down sales through specific wholesale partners, such as Dick’s, Foot Locker, or Nordstrom. According to its most recent annual report, wholesale revenues accounted for 61% of total Nike sales in fiscal 2021, down from 65% the year before. The remaining transactions were made at Nike stores or on its website, which represents a growing part of the sneakermaker’s business.
But Nike is still betting on key business partners.
âWe have a very diverse set of consumers at Nike, and we need to be able to serve this diverse group of consumers,â said Sarah Mensah, vice president and general manager of Nike’s North America division. “We really think he’s the future of retail … and that’s really what the partnership means – to take it to the next level.”
Meanwhile, Dick’s has stepped up its investments in its own private labels. In March, she launched her own men’s sports line called VRST. This joined her biggest private label in terms of sales, a feminine brand called Calia. Dick’s reported $ 1.3 billion in sales of its internal brands in 2020, with total sales of $ 9.58 billion.
But she still has a strong connection to Nike, a brand she has worked with for about half a century. According to Dick’s latest annual report, Nike was the company’s largest supplier in 2020, accounting for around 19% of merchandise purchases.
âYou’ve seen the brands that have been very loud to come out of some distributions that don’t bring their brand to life in the best way,â said Dick’s general manager Lauren Hobart. “But Nike and our other partners recognize that you have to have a physical footprint.”
According to Hobart, the merger will also give Dick’s access to more of Nike’s popular lifestyle sneakers, not just athletic shoes. The company hopes to be viewed by consumers as a destination for the latest equipment by anticipating âdropsâ of new products each month.
âIt’s going to unlock a whole new level for us,â she said. âThis will continue to strengthen the brand relevance as Dick’s offers some of the best shoes on the market. â¦ We are now in partnership with Nike on this long term roadmap. “
At its newly opened House of Sport location in the Rochester suburb of Victor, New York, Dick’s gave Nike a huge amount of space to showcase its products. This location, along with another House of Sport store in Knoxville, Tennessee, is where Dick’s plans to host some of his first in-person events for Nike members.
Dick’s shares have risen about 120% year-to-date. Nike is up about 18%.