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THE HOME DEPOT

The Home Depot


Brand Audit

Saul Mendiola
Professor Haworth
MKT 3320.001
12/16/14

THE HOME DEPOT

I.

Brand Inventory.

A. Company:
The Home Depot was founded in 1978 by Bernie Marcus and Arthur
Blank. Along with investment banker Ken Langone and merchandising
guru Pat Farrah, the founders vision of one-stop shopping for the do-ityourselfer came to realization when they opened the first two Home
Depot stores on June 22, 1979, in Atlanta, Georgia. The first stores, at
around 60,000 square feet each, were big warehouses that dwarfed
the competition and stocked 25,000 SKUs, much more than the
average hardware store at that time. Empty boxes piled high on the
shelves gave the illusion of even more product. As of 2014, The Home
Depot has more than 2,200 convenient locations throughout the United
States (including the territories of Puerto Rico and the Virgin Islands),
Canada, China and Mexico. Stores average 105,000 square feet with
approximately 23,000 additional square feet of outside garden area.
The Home Depot, Inc. is the worlds largest home improvement retailer
based on Net Sales for the fiscal year ended February 2, 2014 ("fiscal
2013")

Financial Statements*

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In August of 2014, Home Depot announced that longtime CEO Frank


Blake will step down on November 1. He was to be replaced by Craig
Menear, the companys then U.S. retail president. Menear oversaw the
companys

supply

chain

network,

global

sourcing

and

vendor

management, as well as its marketing and digital business. Since


joining Home Depot in 1997 Menear has served in various high level
merchandising roles including, most recently, executive vice president
of merchandising.

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Frank Blake.

Craig Menear.

B. Category and Competition: The Home Depot competes mainly


based on customer service, price, store location and appearance, and
quality, availability and assortment of merchandise. In each market it
serves, there are a number of other home improvement stores (Lowes
is considered to be the companys major competitor), electrical,
plumbing and building materials supply houses and lumber yards. With
respect to some products and services, it also competes with specialty
design stores, showrooms, discount stores, local, regional and national
hardware stores, mail order firms, warehouse clubs, independent
building supply stores and, to a lesser extent, other retailers, as well as
with installers of home improvement products.

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It is good to mention that the companys business is subject to


seasonal influences. Generally, the highest volume of sales occurs in
the second fiscal quarter (June-August) and the lowest volume occurs
during the fourth fiscal quarter (December-February). This can be
attributed to weather conditions in the areas that allow homeowners
and contractors to work on their home improvements and new
constructions.
The Home Depot maintains a global sourcing program to obtain highquality and innovative products directly from manufacturers around the
world. It has three sourcing offices located in the Chinese cities of
Shanghai, Shenzhen and Dalian, as well as sourcing offices in Gurgaon,
India; Rome, Italy; Monterrey, Mexico and Toronto, Canada.

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C. Products Within Category for the Brand:

Home Depot stores inventory consists of up to 40,000 different kinds of


building materials, home improvement supplies, appliances and lawn
and garden products for all project needs. Selections may vary from
store to store because The Home Depot stores are always stocked with
merchandise that is localized to match area's specific market needs. In
February 2012, In need of an opening price-point private-label brand
that could extend across multiple categories, The Home Depot
introduced the HDX brand. Keeping a close connection to the retailer's
rich brand name and iconic orange color, the HDX brand was designed
and built on a foundation of Trusted Value, delivering premium
products at an affordable price. The launch included a video to educate
store associates and bran guidelines to ensure consistency across a

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wide

range

of

products.

D. Brand Analysis for the Brand: According to Forbes, The Home


Depot is ranked#43 in the list of the most valuable brands in 2014.
Home Depots new growth strategy is tied to E-commerce growth, with
mobile technology, orange apron-clad associates at Home Depot stores
are able to help customers find and buy items by offering them a
broader array of merchandise through access to the retailers
extensive online inventory.

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E. Consumer Profile the Brand: The Home Depot stores serve three
primary customer groups, and they have different customer service
approaches to meet their particular needs:
Do-It-Yourself ("DIY") Customers. These customers are typically home
owners

who

purchase

products and complete their


own

projects

installations.

and

Because

of

them, Home Depot offers a


variety

of

clinics

and

workshops both to impart this


knowledge and to build an emotional connection with our DIY
customers.

Do-It-For-Me ("DIFM") Customers. These customers are typically


home owners who purchase
materials
parties

to

and

hire

complete

third
the

project or installation. Home


Depot offers a variety of
installation

services

targeted at DIFM customers


who purchase products and installation of those products from the
stores, online or in their homes through in-home consultations.
Installation programs include many categories, such as flooring,
cabinets, countertops, water heaters, and sheds. In addition, Home
Depot provide professional installation in a number of categories sold
through in-home sales programs, such as roofing, siding, windows,
kitchen and bath refacing, furnaces, and central air systems.

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Professional Customers. These customers are primarily professional


remodelers,

general

contractors, repairmen, small


business

owners

and

tradesmen. Home Depot offer

variety of special programs to

these

customers, including delivery


and

will-call

dedicated

staff,

services,
expanded

credit programs, designated parking spaces close to store entrances


and bulk pricing programs for both online and in-store purchases. The
company introduced Pro Xtra, a new loyalty program that provides
professional customers with discounts on useful business services,
exclusive product offers and a purchase tracking tool to enable receipt
lookup online and job tracking of purchases across all forms of
payment.

F. Advertising/Marketing Communications for the Brand:

The

Home Depot offers a low price guarantee to beat anyone's advertised


specials. And if for some reason you can't find it in the stores, they
offer 250,000 other products that they can special order for its
customers. The slogan "More saving. More doing." was introduced by
The Home Depot in March 18, 2009, replacing "You can do it. We can
help." which had been used since 2003.
The Home Depot claims to be The world leading home improvement
store who provide great customer service and have respect for all
people. This positioning statement reinstates the fact that Home
Improvement is the store to go to for any of your home improvement
needs. It also states that it has respect for all people, including women!

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Many people have this assumption that Home Depot is not the home
improvement store to go to if you are a woman, whereas Lowes would
be the best store for women. The goal is to position the store as a
welcoming place for both men and women. Home Depot released the
Lets do this campaign to motivate
homeowners to take on do-it-yourself
projects around their homes. To drive
home the message, The Home Depot
needed something to tie the message
together.

What

one

item

could

represent the projects homeowners


have? The answer: a bucket.

G. Media for the Brand: The Home Depot business has one of the most
recognized brands in North America. As a result, The Home Depot
trademark has significant value and is an important factor in the
marketing of their products, e-commerce, stores and business. Home
Depot is considered to be one of the efficient advertisers. This year so
far, the company has spent $25.1 million in advertising resulting in a
6.9% share, or roughly $3.6 million.
H. Promotions for the Brand: In 2008 Home Depot marketed its New
Low Prices campaign which featured rebates and
discounted prices on over thousands of products.
Home Depot also offers discounted prices via its
online Savings Center where it cuts up to 20% off
products such as play sets, kitchen faucets, and
professional saws.

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The company has established special
buys prices on appliances offering 25%
discounts on products such as Washer &
Dryer sets, and 20% off on Water & Ice Refrigerators.
Home depot also offers a 10% discount on a first purchase when
opening a new credit card account, as well as no interest if paid in full
within 6, 12, or 24 months depending on the amount spent with a
minimum payments required.
Home Depot and longtime competitor Lowes are known to offer a 10%
discount to military members and their families, and in many cases
veterans and retirees any day of the year.
I. Internet and New Media for the Brand:

Home Depot recently

redesigned its web site, which has led to increased site visits and
higher conversion and customer satisfaction rates. Visits to the site
are up 20% year over year and conversion rates are up 30%. The
Search engine optimization also has been improved, with Home Depot
creating unique meta-data for content pages and product pages, In
addition, the retailer implemented auto-fill for its search box, resulting
in significant improvement in site satisfaction rates and conversions.
The home also has a strong social media presence such as Facebook,
in which it has approximately 1.7 million likes, they also provode their
visitor with promotions and links to photos and videos about its
products and services. On twitter, the executives team are prolific
twitters. Their approach seems to be right out the playbook: interact,
engage and inform. Home Depot loves YouTube, the retailer posts
various how-to videos for the visitors and has approximately 75,000
subscribers.

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J. Other Pertinent Information:


On

September,

2014,

Home

Depot announced that hackers


exposed 56 million credit and
debit cards during its monthslong

security

company

also

breach.
stated

it

The
had

eliminated the malware behind the attack from its payment systems.
Card readers that encountered the malware, which Home Depot said
was a custom strain its security team had never seen before, were
removed from service. The company The Company offered identity
protection services to any customer that has used a card in its stores
since April.

K. Brand Value Discussion: The name Home Depot uses a unique


trademark, which identifies what the company offers and distinguishes
it from other product category entries. Also Home Depot has some

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exclusive brands that its major competitor
Lowes doesnt have. The colors that the
Home

Depot

background

uses

with

are

big

Orange

white

in

letters

the
that

describes the name of the company. Home


Depots name is very eye catching and easy
to remember for consumers. Nowadays, its
hard to think of home improvement without thinking of The Home
Depot. The Companys growth, coupled with the trusting relationship
they have develop with each customer, has resulted in The Home
Depot becoming a powerful brand.

II.

Brand Exploratory:
A. In order to quantify and explore the depth and breadth of The Home
Depot brand awareness, a short survey was conducted by a few
random individuals. The questionnaire was as follows:
1. Do you know what Home Depot is and what they sell?
2. How often do you visit The Home Depot?
3. How was your shopping experience?
4. What comes to mind when you see/hear The Home Depot?
5. Ho w is the Home Depot brand exposed to you? If any.
We had ten participants responding to the survey, 50% of those being
women between ages 20-50. And 50 % were men between ages 20-55.
Results:
Based on the results from question 1, all of the respondents stated that
they are aware Home Depot is retail store that sells products for home
improvement.

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For questions 2, it was concluded that man visit Home Depot more
often, with an average of 3 to 5 times a week. This can be attributed to
the fact that most of them own a home and take trips to the store for
their daily home maintained. Some of them were also regular visitors
given that they work with contractors and remodelers. On the hand,
women had an average of 2 to 3 visits per month, it was interesting to
see a big difference among the different groups. Women also
considered themselves as seasonal shoppers, meaning they only go
to Home Depot on specific occasions such as, summer and Christmas.
Question 3, all of the respondents said their shopping experience was
pleasant, they were assisted by one or more of the sales associates in
the store. There was only one person (male) who said he had a bad
experience with the Home Depot, he was unhappy about the amount
time it took for him to receive his special
ordered fridge.
For question 4, all participants provided a few
words

describing

their

thoughts

when

the

hear/see The Home Depot. Some of the


specific responses included: Work, Lumber, Dirt,
Concrete, Remodel, Garden and Paint. All of
these words fall under the category of home
improvement.
Lastly, for questions 5, all participants stated that the Home Depot
brand is exposed to them through social and traditional media. They
said they have seen various commercial on TV, as well as ads for
special buys online.
B. Although it was a small sample of data, we can conclude the Home
Depot brand is well known among men and women of ages 20 to 50

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year old. The brand does a great job at exposing its business in social
and traditional media.
However, it appears that Home Depot key customers are professional
contractors (particularly men), who bring a bigger portion of the net
sales. In order for the company to attract more female clientele, the
company might need to be retake and be more aggressive on their
existing Do-It-Herself workshops, which will empower women to take
their home improvement project plans from dreams to done.

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Citations

Berger, David. "The Home Improvement Retail Industry." Business and


News RSS. BidnesEtc, 6 Mar. 2014. Web. 10 Dec. 2014.
<http://www.bidnessetc.com/business/the-home-improvement-retail-

industry-analysis
Gaston, Dave. "The Home Depot HDX." MSI A Marketing
Communications Company. Home Depot Private Label, 21 June 2013.
Web. 13 Dec. 2014. http://agencymsi.com/work/the-home-depot-hdx-

private-labels
Media, Forbes. "Home Depot." Forbes. Forbes Magazine, 5 Mar. 2013.

Web. 10 Dec. 2014. http://www.forbes.com/companies/home-depot/


The Home Depot - Home." The Home Depot - Home. Home Depot, 6

July 2013. Web. 13 Dec. 2014. https://corporate.homedepot.com


Cummings, Kellie. "Home Depot's Sloppy Mistakes Tarnish Its Once
Bold Brand." The Huffington Post. TheHuffingtonPost.com, 25 Sept.
2014. Web. 16 Dec. 2014. <http://www.huffingtonpost.com/kelliecummings/home-depots-sloppy-mistakes_b_5867068.html

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