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Home Depot and Lowe's succeed at omnichannel

Why US Consumers Shop
Why US Consumers Shop

BI Intelligence

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Home improvement retail chains Home Depot and Lowe’s have stood out in recent years for their successful implementations of omnichannel strategies, Digital Commerce 360 reports.

Both retailers have launched a wide range of omnichannel initiatives, including mobile apps for their in-store associates, click-and-collect options, and tools that help digital shoppers find products in their stores.

These initiatives have turned the chains’ brick-and-mortars into key components of their e-commerce fulfillment operations, which helps them keep their delivery costs low. Home Depot reported earlier this year that 45% of its online orders are picked up in-store, while Lowe’s says its in-store pickup option is used for about 60% of its e-commerce sales. Additionally, Lowe’s reports that about 40% of shoppers picking up online purchases in-store make an additional purchase during their visit.

Inventory management has been a critical factor for both retailers’ omnichannel success. Executives at both companies credit some of their success to making in-store inventory visible to customers through their websites, allowing shoppers to check if the product they’re looking for is available at a given store location. Customers visiting Home Depot or Lowe’s are typically trying to make their purchase and get out of the store quickly to get started on their project, and this visibility is useful in facilitating quick store visits. This could be a useful advantage for other retailers as well — one of the top reasons that young shoppers still go to stores is the immediate fulfillment of their purchase. As these shoppers grow up and achieve greater buying power, tools that help speed up store visits will become increasingly important.

E-commerce has been on the rise in the last several years, thanks in large part to titans in the industry such as Amazon and Alibaba. E-commerce will truly become the future of retail, as nearly all of the growth in the retail sector now takes place in the digital space.

BI Intelligence, Business Insider's premium research service, forecasts that U.S. consumers will spend $385 billion online in 2016. Moreover, BI Intelligence predicts that number will grow to $632 billion in 2020.

This is hardly surprising considering e-commerce's healthy growth. Though the U.S. retail average growth rate in the first half of 2016 was just 2% for total retail, it was 16% for e-commerce.

The number of online shoppers has grown by nearly 20 million from 2015 to 2016. And these 224 million shoppers are spending more, as the total amount spent online grew from $61 billion in the first quarter of 2015 to $68 billion in Q1 2016. Finally, these customers are transacting more frequently, as the number of online transactions has risen by 115 million from 2015 to 2016.

But all of this shopping online creates its own set of challenges, both for consumers and the companies that are trying to get their products onto shoppers' screens and into their shopping carts. In short, you need a plan.

And to create your ultimate e-commerce battle plan, you need the right intel.

BI Intelligence is here to help.

Our team of industry experts has you covered on topics such as:

  • Shopping cart abandonment

  • Marketing effectiveness

  • Merchandise returns

  • Customer satisfaction

  • Social media monetization

  • Mobile payments

  • Accommodating shoppers at the 11th hour

  • And much more

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