Dr. Regina Henkel
Author:
Dr. Regina Henkel

Digitalization of specialty sports retail in the sports business: Class instead of mass

How Successful Multichannel Retailers Hold Their Ground on the Market

Specialty sports retail has no chance against the global players? Not true. With their individual strategies, Keller Sports and Kickz show how you can successfully hold your ground against the outsized competition.

2018 eröffnete Kickz seinen neuen Store in Hamburg. Wenn neue Sneaker in den Laden kommen, campieren die Fans vor der Tür.
In 2018 Kickz opened its new store in Hamburg. When new sneakers come into the shop, the fans camp outside the door.

Around 40 percent of sales in the sports retail sector are already generated online. For a long time, at the expense above all of stationary retail. But the realization that e-commerce and stationary retail go well together has now established itself. They even complement each other perfectly.

Retailers like Keller Sports and Kickz, both of whom are very successful using multichannel concepts, prove this. As part of the ISPO Digitize Summit, Marcus Trute, Director of Keller Sports, and Christian Grosse, CEO of Kickz, spoke about which strategies work and how to stay relevant in a business that is increasingly concentrating on the major players.

Kickz works in a niche with a clear target group

When Kickz’s first streetwear store opened in Munich in 1993, the Internet was still in its infancy. But Christian Gross was certain that an online store was just the right thing for his small, international target group. “Multichannel was important for us from day one,” says Grosse.

That’s why ‘Kickz.com’ was on the facades of the stores from the beginning, and the stores were always used as a warehouse as well. Today, online sales make up “significantly more than half,” says Grosse, at a total of 15 stores in Germany. There are separate online stores for the DACH region, the US, France, the UK, Sweden, Finland, Denmark, Norway, the Netherlands, and Belgium. Kickz has been owned by Zalando since 2017.

Kickz with K1x: Own brands as a success factor

Two years after opening their first store, the Kickz team created their own sneakers brand, K1x. Grosse: “It made sense for us, because we could, and because we ourselves were part of the scene and knew the lifestyle exactly. And of course it was great founding a brand and having a sales channel for it right away.”

To be able to produce economically, K1x needed other retailers like Footlocker and Snipes. But they were suspicious and not easy to convince. After all, Kickz as a store was a competitor, even if the K1x brand would sell well. “It was difficult, but ultimately the pressure was so high they couldn’t get around it,” explains Grosse.

Keller Sports: The premium segment didn’t exist yet

Keller Sports was founded in 2005 with the idea of establishing an online store for the premium segment. “We still didn’t see any premium retailers in the sports sector back then, there were only retailers for the mass market,” Marcus Trute explains. Sure, there was Engelhorn Sport and Sport Conrad, “but they came from the stationary business and still weren’t relevant online yet.” The increasing verticalization in the sports business also made it clear that, in the future, retail would generally have problems staying relevant for brands and getting the best products.

“That’s why we looked intensively at the brands and looked for ways to improve our position,” says Trute. The results are multifaceted: A high-quality online shop was designed with an elaborate product presentation. A premium membership with exclusive deals gets customers loyal to the store, which has now also gotten a stationary offshoot for exclusive product launches and brand events.

With a self-developed app, customers can collect points for sporting activities and redeem them in the store - challenges are meant to motivate users to ongoing participation. The latest coup: Under the name Keller X, the retailer launched an lifestyle store in July, thus expanding its target group.

“That’s why we looked intensively at the brands and looked for ways to improve our position,” says Trute. The results are multifaceted: A high-quality online shop was designed with an elaborate product presentation. A premium membership with exclusive deals gets customers loyal to the store, which has now also gotten a stationary offshoot for exclusive product launches and brand events.

With a self-developed app, customers can collect points for sporting activities and redeem them in the store - challenges are meant to motivate users to ongoing participation. The latest coup: Under the name Keller X, the retailer launched an lifestyle store in July, thus expanding its target group.

Der Keller Sports Brand Experience Store hier ganz im Zeichen von Nike Women: Auf dem Bild wird die neue Nike Metallic Sheen Collection präsentiert.
The Keller Sports Brand Experience Store here is all about Nike Women: The picture shows the new Nike Metallic Sheen Collection.

The customer is the focus of sports retailers

For both retailers, the direct line to the customer is the key to success. “What won’t work,” says Grosse, “is differentiating yourself through prices or buying Adwords.” Staying lastingly relevant for the target group is a challenge, especially when they are young. Kickz is investing a lot of manpower in content creation to charge up the products and connect them with the right lifestyle. Digital tools for data generation are of little help. Grosse: “Our customers are too young and they’re changing too quickly. More data on customer behavior wouldn’t get us any further.”

At Keller Sports, on the other hand, the evaluation of customer interests was the decisive factor for the product range design. Running and tennis were set from the beginning; what other categories could be added were determined by a customer survey. The surprising result: Soccer did not get a majority.

Kickz and Keller Sports artificially running short

Exclusivity plays a key role in the competition for the favor of discerning customers – this is true both retailers. But online stores in particular have problems implementing them. That’s why Kickz and Keller Sports found ways to artificially make their products run short. Keller Sports’ stationary store only opens for special events, and concentrates on a very select few products. Trute: “The square meter turnover doesn’t matter.”

What counts instead is the community effect and the exclusive staging of product and brand. If Kickz has sneakerheads camping in front of the store to get limited sneaker editions, it’s clear to Kickz that these products have no business in the online store. “In this respect, the multichannel idea is already developing again and is moving away from total availability,” says Grosse.

Dr. Regina Henkel
Author:
Dr. Regina Henkel
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