September 25, 2013, 11:43 AM

Dick’s Sporting Goods is swinging for the e-commerce sales fences

The chain retailer aims to reach $1 billion in web sales by 2017.

Lead Photo

Edward Stack, CEO

It’s giving itself just over three years to pull it off, but Dick’s Sporting Goods Inc. is aiming to become a $1 billion web merchant.

Along the way, Dick’s Sporting Goods also is looking to bring all of its e-commerce technology in-house and leverage its stores even more to grow online, CEO Edward Stack told Wall Street analysts last week at the company’s annual investor’s day event. “We will internally control and grow our e-commerce business to in excess of $1 billion by 2017, and we'll grow the Dick’s Sporting Goods footprint to over 800 stores by 2017. This is an ambitious goal, yet we believe it's really achievable,” Stack told analysts.

Dick’s, No. 94 in the 2013 Internet Retailer Top 500, grew its web sales 46% in 2012 to around $278 million and in the second quarter of 2013 posted an increase in e-commerce sales of about 9.3% to $86 million. The retailer didn’t provide a year-to-date update. “We'll invest heavily in what we still believe is the future of retailing through an e-commerce and omnichannel platform,” Stack said.

In order to nearly triple its annual e-commerce sales by 2017, Dick’s is working to bring all of its technology in-house. Dick’s has been a long-standing client of eBay Enterprises, formerly known as GSI Commerce, which eBay acquired in 2011. But late last year Dick’s announced in a regulatory filing it was cutting its agreement with eBay for e-commerce technology services by seven years, from 2024 to 2017.

At its investor’s day meeting, Dick’s executives said the deal will help the sporting goods retailer control costs and focus even more on new ways to grow its web business.

“Our final strategy to improve the profitability of this business is to take our e-commerce capabilities in-house to internally control our e-commerce business,” executive vice president of inventory, supply chain and e-commerce Michele Willoughby told analysts. “Aside from the profitability impacts of doing this, there are additional benefits. We will have the controls to differentiate our brands and online experiences, we will have easier access to our data, and more easily use these cross channels to build more engaging customer experiences.”

With more internal control over e-commerce technology, Dick’s also will be able to react faster to customer needs and market changes, Willoughby told analysts. “We will have the control over development cycles, which will allow us to test and iterate at a significantly faster pace; and finally, we will be able to quickly stand up new verticals to capitalize on market opportunities,” Willoughby said. “This will be a meaningful investment over the next four years with key investments in technology, the organization for our future and supply chain infrastructure."

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