Dick’s Sporting Goods officials are optimistic about the all-important holiday season as it presents a larger opportunity to extend customer engagement and brand loyalty.
That’s because it’s been a busy year for Dick’s in the acquisition department.
On July 20, 2016, Dick’s completed its purchase of The Sports Authority’s (TSA) intellectual property assets and the right to acquire 31 store leases. Dick’s officials have determined to retain 22 of these leases for conversion. What’s more, Dick’s officials will leverage the TSA customer information it purchased during the fourth quarter of 2016.
More recently, on Nov. 2, 2016, Dick’s completed its purchase of certain assets of Golfsmith International Holdings, including its intellectual property and rights to acquire store leases, together with inventory for 30 stores. The purchase was made in connection with Golfsmith’s Chapter 11 filing.
The purchase price was approximately $43 million, of which $32 million is related to inventory. Dick’s officials have said they will offer employment to at least 500 current Golfsmith employees.
Bringing together these companies in a cohesive, integrated fashion in time to make a splash during the holiday season is the challenge.
Clutch CEO Ned Moore talked to Loyalty360 earlier this year about the challenges of customer loyalty.
“Across many industries, the concept of loyalty has largely been relegated to a transaction in lieu of a longstanding commitment from the customer,” Moore explained. “The ‘buy three, get the fourth free’ approach doesn’t earn trust, develop commitment, or result in genuine loyalty. Many brands are realizing this, along with the idea that embracing discounts as the backbone of their engagements doesn’t result in loyalty and often ends up diminishing customer relationships, eroding margin, and even attracting the wrong type of customer.”
Moore added that he has seen a paradigm shift among many companies and industries that are embracing the concept that loyalty is driven by the entire holistic customer experience they deliver.
“The key to this is the consistency and relevancy of customer engagements everywhere and time that the customer wants to interact with us,” he said. “This requires a complete understanding of our customers and exactly what they are doing with us.”
During Dick’s recent third-quarter earnings call, CEO Edward Stack said the company is “making progress” on the recently acquired TSA customer information and it will be directly marketing to these customers during this holiday season.
“This marks a terrific opportunity for us as we continue to build our position as America’s No. 1 golf retailer and focus on capturing a significant amount of market share as the industry consolidates,” Stack explained. “Looking to next year, we expect this acquisition to be accretive to our earnings. Digital is a big priority and this business continues to accelerate. We have made significant investments in our e-commerce business and remain on track to re-launch dicks.com on our own web platform in the first quarter of next year.”
Looking at the fourth quarter, Stack added: “We are confident that our assortment and marketing will help us to continue to capture this displaced market share this holiday season.”