An\u00a0April UBS report\u00a0estimates that 80,000 US retail locations\u2014or close to 10 percent of total stores in the country\u2014will shutter by 2026, while e-commerce sales will rise to 27 percent of total retail purchases.<\/p>\r\n
But those numbers don\u2019t tell the whole story. Data-savvy retail companies are blending the two modes of shopping into an\u00a0omnichannel strategy\u00a0that can spark business advantage. Rather than framing online and physical sales as a zero-sum contest, leading executives recognize that stores and e-commerce can actually boost each other\u2014a phenomenon known as\u00a0the halo effect.<\/p>\r\n
The largest sporting goods retailer in the US has taken this approach and emerged from the coronavirus pandemic stronger than ever. Bucking what some might think of as conventional wisdom in the era of one-click shopping, DICK\u2019S Sporting Goods is adding to its network of brick-and-mortar stores to complement a growing online presence. Whether customers are browsing aisles of basketballs, lacrosse sticks, and running shoes, or swinging by for curbside pick-up of online orders, DICK\u2019S strategically placed locations act as important customer engagement points in a thriving omnichannel network.<\/p>\r\n
<\/p>\r\n
The company\u2019s real estate division supports that network by relying on a geographic information system (GIS) to guide\u00a0market development\u00a0and retail optimization. Using the business insight generated by GIS\u2014known as\u00a0location intelligence\u2014the company\u2019s real estate directors forecast customer demand in new trade areas and analyze the concentration and spacing of stores in developed markets.<\/p>\r\n
For instance, the team cross-references census-based data on sporting goods expenditures against its own\u00a0loyalty data\u00a0on online sales to spot areas of high customer demand, signaling strong potential for a DICK\u2019S store.<\/p>\r\n
DICK\u2019S analysts also used location intelligence to plan the geographic footprint of an unprecedented venture: an experiential concept store called House of Sport, opened this March in Victor, New York, with another to open in Knoxville, Tennessee in June. The sprawling New York location is the company\u2019s\u00a0biggest store ever\u00a0at 100,000 square feet, equipped with an outdoor track, a putting green, and an indoor rock climbing wall.<\/p>\r\n
Over the past year, the company\u2019s holistic approach to brick-and-mortar stores and digital channels has been instrumental in serving customers. DICK\u2019S e-commerce sales surpassed $2.8 billion in 2020, a 100 percent increase. The strongest growth came from in-store and curbside pickup, as BOPIS sales increased more than 350% over the previous year.<\/p>\r\n
With more than 850 stores across the country, DICK\u2019S Sporting Goods was well-positioned to cater to consumers replacing gym memberships with home exercise equipment due to pandemic restrictions, or jumping into outdoor sports to accommodate social distancing. Acting as mini-distribution centers, the stores helped the company fulfill online orders quickly and efficiently. Since these brick-and-mortar sites had been selected for their accessibility to consumers, they helped cut down on delivery times for online purchases.<\/p>\r\n
The company was, in part, able to capitalize on such trends because it had already established a thriving network of physical stores in trade areas assessed annually by GIS analysts<\/p>\r\n
\u201cThe heavy lift of data here is massive,\u201d says Jack Holden, a GIS specialist and market research analyst at DICK\u2019S. \u201cWe\u2019re trying to get the result right, trying to get the right site, and help people understand the data to inform very important decisions.\u201d<\/p>\r\n
<\/p>\r\n
Five or so years ago, DICK\u2019S analysts wondered whether the relationship between physical stores and online shopping might ultimately be a cannibalistic one. \u201cThe traditional thinking then, mostly outside the organization, was that brick-and-mortar was going to be really hurt by\u00a0 e-commerce, and that we might not need as many stores,\u201d says Bill Grassel, director of real estate market research and strategy at DICK\u2019S Sporting Goods.<\/p>\r\n
One of the benefits of location intelligence is that it checks assumptions against facts on the ground\u2014and this particular assumption ended up being wrong. \u201cA lot of the\u00a0spatial analysis\u00a0that we\u2019ve been able to do has said [that] when we add new stores, we actually see our entire omnichannel sales go up,\u201d Grassel says. \u201cUnless we had been able to analyze those customer behaviors at that level, we might have assumed, if we open a store, we\u2019re going to hurt our e-commerce sales and vice versa,\u201d he continues. \u201cBut we really found more of a symbiotic relationship between the two.\u201d<\/p>\r\n
In addition to guiding the expansion of the retail network, GIS-based insight also helps DICK\u2019S respond to unexpected occurrences.<\/p>\r\n
The onset of the COVID-19 pandemic was one such occurrence. The danger of the virus and the need to gather and share information quickly made maps and dashboards a natural fit.<\/p>\r\n
\u201cAs devastating as this whole pandemic has been, opportunities arise out of trying to answer some questions about a very serious subject,\u201d Holden says. In addition to directing colleagues to good sources of data on the pandemic and helping them create maps of their own, Holden produced dashboards showing where DICK\u2019S stores were open, where stores were closed due to shutdowns, and the location of points of interest like testing sites. \u201cWe saw that come to life in a map,\u201d Tirimacco says.<\/p>\r\n
The use of GIS to chart COVID-19\u2019s effects showed colleagues how location data could be used in analytics at DICK\u2019S, Holden says. After map-based presentations, he and the team often field requests from coworkers asking if they can access the online GIS platform. \u201cIt\u2019s neat to get more people involved and try and educate people a little bit in the geospatial world,\u201d he says.<\/p>\r\n
As markets recover, many consumers are anxious to get out of the house and engage in a little in-person retail therapy, making a fluid omnichannel approach a retail advantage. Thanks to its store-centered, location-smart strategy, DICK\u2019S Sporting Goods will be ready with its doors open and its e-commerce channels thriving\u2014serving customers however they choose to engage.<\/p>\r\n
<\/p>\r\n
<\/p>\r\n
<\/p>\r\n
An\u00a0April UBS report\u00a0estimates that 80,000 US retail locations\u2014or close to 10 percent of total stores in the country\u2014will shutter by 2026, while e-commerce sales will rise to 27 percent of total retail purchases. But those numbers don\u2019t tell the whole story. Data-savvy retail companies are…<\/p>\n","protected":false},"author":1,"featured_media":3191,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"inline_featured_image":false,"footnotes":""},"categories":[89],"tags":[],"class_list":["post-7796","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-blog-en"],"yoast_head":"\n