Fresh off a stellar performance during the COVID-19 pandemic, Dick’s Sporting Goods is preparing to get off the playing field and head for the hills.
The company is launching a new outdoors-focused concept called Public Lands, in development for several years by Dick’s executive chairman Ed Stack, and will open its first two stores in a few months; one in Pittsburgh and the other in Columbus.
The Public Lands stores, occupying two former Field & Stream spaces, will be 50,000 square feet in size—about the same as a Dick’s Sporting Goods store. And they will feature specialized shops dedicated to different activities such as camping, biking, and hiking.
They will have a heavier focus than Dick’s on footwear and clothing that suits the activity in question—but that also looks good and is potentially at a higher price point. Employees won’t be called store workers or associates; they will be known as “guides.”
For many of today’s outdoors enthusiasts, the gear and clothing are as much about lifestyle and a look they can wear in everyday life—as exemplified by city dwellers wearing insulated vests—as they are about the activities themselves.
“We’ve got the opportunity to give them the ability to showcase their lifestyle on a day-in, day-out basis whether they’re on a trail, skiing, or going out to dinner on Friday night,” Stack told Fortune in an exclusive interview.
The opening Dick’s sees in an already well-served $100 billion outdoor gear market is the space between the hard-core outdoors person able to survive days alone in the wilderness, and the very casual suburbanite who likes to go on walks. That is fueled by people’s growing interest, certainly after the pandemic, in hiking and biking locally, not just when they can go to a national park on holiday.
“The white space is being absolutely legit in terms of technical functionality, but also having an unapologetically style-forward aesthetic,” says Todd Spaletto, the former North Face and Wolverine Worldwide executive Dick’s hired in December to head the Public Lands effort. That means the running, skiing, and cycling sections (see rendering below) will feature the equipment but also the increasingly pricey clothing that goes with those sports.
Public Lands will feature national names like Brooks, Patagonia and The North Face (with which Stack broached the Public Lands idea several years ago) and will cater to a customer base gravitating increasingly toward higher-end, pricier gear now, whether it is Yeti coolers, Snow Peak camping cookware, bike jerseys, and running shirts that can easily top $100. About one-third of sales are expected to come from hard goods like bikes, tents, and camping cookware, and the rest from footwear and clothing.
Even though the pandemic delayed the launch of the stores, the COVID-19 outbreak unleashed a heightened interest in the outdoors that Dick’s wants to leverage. Research from the Outdoor Industry Association released this spring found that post-pandemic, new outdoor participants were more likely to be female, young, and live near cities—demographics coveted by any retailer—than was the case pre-COVID. What’s more, three-quarters of new outdoor enthusiasts said they wanted to continue their outdoors activities post-pandemic.
But it’s not just macro trends that make Dick’s executives think there is consumer appetite for a new outdoors retailer. REI, the popular outdoors chain and Public Lands’ most obvious rival, is hurting after revenue fell 12% in 2020 to $2.75 billion, hurt by lengthy store closures and supply-chain problems. (The financial strain prompted REI last year to sell off its fancy new headquarters near Seattle before it had even moved in.) And a few years ago, some outdoors-focused retailers like Gander Mountain shrank while in bankruptcy protection and others liquidated altogether.
Still, outdoors enthusiasts tend to be a loyal bunch, so the onus will be on Public Lands to explain to them why they should switch. And REI, a cooperative that pays members a dividend proportionate to their annual spending at the store, has set a high bar for dazzling customers. REI’s store near downtown Denver, for instance, is a former 100,000-square-foot power plant that features a multistory indoor climbing rock and lets potential buyers try out a kayak in the South Platte River right outside the store.
At the same time, Dick’s is no slouch at retail theater, one of the many reasons it has outlasted rivals like the now liquidated Sports Authority and Modell’s chains. In April, Dick’s opened its flagship House of Sport store in Victor, N.Y., a 100,000-square-foot emporium twice the size of an average Dick’s store, featuring not only a rock-climbing wall and a racetrack, but also golf driving bays, a putting green, and a health-and-wellness juice shop, with shop-in-shops for popular brands like Yeti and Vans. Even an average Dick’s has touches such as a batting cage (which replaced the former firearms area) that has made the stores a draw.
That has helped Dick’s soar in recent years: In 2020, same-store sales at the company rose 9.9%, a momentum that has continued into early 2021, putting Dick’s on pace to easily hit the $10 billion in sales mark this year for the first time. Dick’s won’t estimate how many Public Lands stores the market could ultimately support, but given the shrinking importance of Field & Stream, with its emphasis on hunting gear, the new chain could be an important source of growth down the line.
Winning over the hard-core enthusiast
Given its name, credibility as an advocate for the protection of public lands will be as crucial for Public Lands as it has been for REI and brands like The North Face and Patagonia. The latter a few years ago famously sued former President Trump over a plan to halve a national monument in Utah. Public Lands will team up with Patagonia on a conservation program.
While Public Lands will be a new face in outdoors retailing, Stack says that Dick’s longtime advocacy on big issues will help; an example is its decision a few years ago to largely remove firearms from its assortment amid a spike in mass shootings. Dick’s has also supported youth sports for decades financially and with gear.
“I think we have great credibility based on what we’ve done in the past around youth sports and how we’ve invested in keeping the conversation going from a firearms standpoint,” says Stack. And the very name Public Lands is designed to serve as a daily internal reminder of those pledges. “If you pick the name Public Lands you better live up to that moniker. This name puts a lot of pressure on us to do what we say we’re going to do,” he says.
Dick’s plans to donate a certain percentage of Public Lands’ annual revenue to nonprofits and has joined groups like the Conservation Alliance, with other moves to be announced when the stores open.
Of course advocacy is all fine and good. But for Public Lands to win customers, it will have to find its niche not only vis-à-vis rivals like REI and Gander Outdoors, but also its sister chain, Dick’s, which operates 728 stores and with which there will be a 20% overlap in merchandise.
Stack, who stepped down as CEO in February after 36 years but kept the role of chief merchant because he is such a gearhead, says Public Lands understands that very well. So its bikes section, for example, will have higher-end bikes than Dick’s or REI do, like Cannondale, and offer services like repair and sell clothing for the more hard-core cyclist. At the camping shop, Public Lands will try to cater to the kind of person who will go to the backcountry, as well as the casual camper who might want a camping-friendly sound system to entertain friends around a campfire.
Running is also an extremely busy area in sports retail and a big category for Dick’s. So to stand out, Public Lands will emphasize off-road running in terms of shoes including fast-growing brands like Hoka and Altra, along with clothes and accessories.
Ultimately, Public Lands’ success will hinge on successfully bridging the needs of both kinds of customers, says Spaletto.
“Why you’re seeing this boom in the outdoors [market] is not because they necessarily want to go backcountry skiing in Alaska, but because they want to go for a hike on a trail versus going for a walk on concrete,” he says.
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