In retail, companies with strong e-commerce platforms fared much better than those lacking a strong online presence. Dick’s Sporting goods was one of the relative winners in brick and mortar retail. Dick’s made investments in its online platform pre-COVID that allowed the firm to roll out a curbside pick up a few days after the company closed all of its stores. Sales were still down 30% year-over-year in the quarter, but it could have been worse. Kohl’s reported sales down 45% for the quarter.
The Coronavirus crisis should be a wakeup call to all brick and mortar retailers. Being able to sell in multiple channels is no longer a luxury. It is a necessity. Allowing customers to search local store inventory and then go touch and feel the products before they are purchased is an advantage brick and mortar retailers have over e-commerce only platforms.
That advantage should be accentuated.
Since taking its e-commerce operations in-house several years ago, Dick’s Sporting Goods has been able to more quickly respond to online shopping trends.
Case in point, the company said during its first quarter earnings on Tuesday that online sales were up 110% year-over-year, thanks in large part to the rollout of a curbside pickup service in response to store closures. Dick’s Sporting Goods closed all of its stores on March 18, and said it was able to roll out curbside pickup just days later. While net sales for the quarter were $1.33 billion, down 30.6% year-over-year, the damage could have been worse. Foot Locker and Kohl’s reported during their first quarter earnings that net sales were down 43.4%, and 44% year-over-year respectively.
Dick’s Sporting Goods has benefitted from some from its products — like weights, running apparel and other at-home fitness equipment — being in high demand. But the company also benefitted from investments it has previously made in its e-commerce business, like improving search and checkout speed, as well as logistics investments to ensure that it could get product more quickly to customers. During the third quarter of last year, for example, the company opened two fulfillment centers during the third quarter of last year.