Dick’s Sporting Goods Is Using First Party Data to Drive Customer Loyalty

Retailers of sporting goods have had somewhat of a mixed bag of fortunes during the global COVID-19 crisis.

On one hand, sales of home fitness equipment and items such as running shoes have continued to sell well as people stuck at home during lockdown restrictions sought to keep fit and healthy. However, with sporting events shut down and sports centers forced to close their doors, sales of gear such as balls, rackets, bats, and clubs have all taken a hit.

However, now we are starting to emerge from the worst days of the pandemic, sporting goods retailers are searching for ways to bring people back out into the sunshine and start enjoying some of America’s favorite pastimes once again.

Dick’s Sporting Goods

As America’s largest sporting goods retailer, Dick’s Sporting Goods is uniquely placed to take advantage of this push. With over 850 stores nationwide, the Coraopolis, Pennsylvania based omnichannel brand has been going back to the drawing board to get Americans up and at ‘em once again.

One major issue being faced by many online brands today, is Google’s announcement that it will phase out support for third-party cookies on its browser service over the next couple of years. This means retailers which rely on Google’s algorithms to target customers with laser-focused advertising need to evolve or die.

Thankfully, Dick’s Sporting Goods is ahead of the curve on this front have already amassed a first party database of over 145 million customers. This has been made possible through a combination of the brand’s innovative loyalty program, its website, and tech acquisitions such as GameChanger – a live scoring app that delivers data-driven coaching insights, live play-by-play updates, and instant game recap stories for 165,000 amateur baseball and softball teams.

Dick’s Sporting Goods now plans to use this data to build detailed and personalized customer profiles for all members of its popular loyalty scheme. These profiles will be based on every touchpoint those customers have with the brand, including their ecommerce, mobile app, email, and in-store activity. These profiles will then be used to improve marketing and content personalization across those same channels and use powerful artificial intelligence software to give relevant product recommendations with the goal of boosting average order sizes.

 "Frankly, we have not done much in terms of personalization in the past," said SVP of Strategy, Ecommerce, and Analytics at Dick’s Sporting Goods, Steve Miller. "We tried some in-house efforts and spent some money on consulting, but it was fairly limited. Gold ScoreCard members will disproportionately benefit from the new improvements. We can offer more tailor-made perks and see the results from those incentives sooner."

Loyalty Through Personalization

Personalization is going to continue to be a driving force in the world of ecommerce. We know from research that retail customers are normally happy to hand over their data if it means receiving a more personalized service from the brands they choose to shop with.

"With a better grasp on individual shoppers, Dick’s will be able to surface improved product recommendations for online customers," added Miller. "For instance, it will be able to show tennis gear to those who have previously purchased tennis rackets. It can also surface articles for golfers from publishing partner Golf Digest."

Perhaps the most exciting part of this first party data driven strategy is the use of AI technology to create a virtual stylist which can help customers put together combinations of products it thinks will complement one another. For instance, if a customer is shopping for a new pair of shoes, the algorithm can search Dick’s catalogue for shorts, a hat, and a t-shirt to go with them.

Dick’s is also training its AI technology to be able to match products to the current seasons and understand complimentary color combinations, further boosting its ability to make salient and attractive recommendations and build exciting collections.

"We can target promotions to customers, and we’re building out our ability to run promotions regionally or locally as well," Dick’s Sporting Goods Executive VP and CFO, Lee Belitsky said in September at a retail event hosted by Goldman Sachs. "In addition, the development of our digital capabilities and personalization, we’re really building out our data science capabilities which will continue to reduce promotions going forward."

Final Thoughts

As Google phases out its support for third party cookies, omnichannel and ecommerce retailers are going to have to increasingly rely on first party data to create targeted and personalized experiences for their customers.

Thanks to its previous activity, Dick’s Sporting Goods has found itself in a great position to get ahead of the game in this regard and is coming out swinging to recover from the COVID-19 pandemic.

You can hear Dick’s Sporting Goods Distinguished UX Designer, Denise Hardman, and Distinguished Product Manager, Erika Green, speak at eTail Boston 2022, taking place in August at The Sheraton, Boston.

Download the agenda today for more information and insights.