Dive Brief:
- Dick’s is joining the paid loyalty fray with ScoreCard+, an annual rewards program that offers free shipping, access to exclusive promotions, a 20% discount on in-store services and experiences, and more benefits for an annual fee of $99.
- The sporting goods retailer plans to dole out $100 in rewards each year to ScoreCard+ members, in increments of $25 every quarter, the company announced Wednesday. Shoppers who sign up for the program can also receive one free service or experience per year, up to $100, and earn 3 times the points on one purchase per year.
- The program is roughly the same price as Walmart+ and Target Circle 360, which offer a plethora of benefits, including free shipping and exclusive discounts. Amazon’s Prime membership program, by comparison, is $139.
Dive Insight:
Dick’s is hoping to turn its existing 30 million loyalty members into a more lucrative revenue stream with the launch of a paid membership tier.
Those customers already account for more than 75% of Dick’s sales, the company said in a press release, and now they will have an expanded tier option to sign up for. Anyone who signs up in July will also receive $100 toward Dick’s owned brands.
Paid programs are relatively rare in the sportswear industry. Outdoor retailer REI's membership program is one exception, though others in the space have also tried — and backed away from — such programs.
Athleisure brand Lululemon once also had a paid membership tier, which was piloted at $128 in 2018. A later offering, Lululemon Studio, was $39 per month and granted access to classes through the retailer’s Mirror fitness technology — and, after Mirror was discontinued, Peloton. Lululemon’s current membership offering is three tiers, depending on how much a shopper spends with the brand.
Dick’s isn’t abandoning its free loyalty program; the retailer is enhancing benefits there as well. The free ScoreCard membership now allows shoppers to trade in 150 points for a $5 reward, versus waiting to accrue 300 points for a $10 reward. Shoppers can also earn and redeem points through Dick’s services, such as glove steaming and bike repairs, or at experiences like its climbing walls.
“Our enhanced ScoreCard and new ScoreCard+ programs recognize the deep relationships we have with our athletes and rewards them not just for purchases, but for all the ways in which they interact with us today,” Emily Silver, chief marketing, e-commerce and athlete experience officer at Dick’s, said in a statement. “We look forward to continuing to build and enhance the program with additional meaningful benefits over time.”
As Dick’s revamps its loyalty structure, the retailer relaunched its credit card in May and now allows cardholders to earn 10% back in rewards on qualifying purchases. An AI adviser debuted later on that month, with an eye toward product recommendations and athletic training tips.
The retailer has also been investing in its media network, which pairs brand partners like On and Under Armour with advertising opportunities. CEO Lauren Hobart said in May that the retailer was “very excited” about the media network, which allows Dick’s partners to advertise to its shoppers in its experiential House of Sport locations and through digital channels, calling it a “high-growth asset.”
“Our visual team, our marketing team have done a fantastic job,” CFO Navdeep Gupta said of the media network, adding that they have created a program that is “measurable and quantifiable” and allows Dick’s to report metrics back to brands. “That's what the brands are really excited about as they think about the Dick’s Media Network.”
Dick’s has continued to thrive in recent quarters, even with the noise introduced by its Foot Locker acquisition last year. The core Dick’s business notched 6% net sales growth in Q1 and the retailer continues to experiment with new store experiences, including a rotating pop-up for its private label brands in the Hamptons this summer and a shop-in-shop deal that brings Lids to 100 stores.
