At the height of the pandemic, the home improvement sector boomed as consumers stuck at home took on DIY projects and invested in their living spaces. As life begins to take on an air of normalcy, DIY projects are no longer providing the foot traffic boost they once did. Nevertheless, demand for professional renovations is on the rise, which presents an opportunity for leaders in the home improvement category to sustain visit growth in the new normal - especially from the ever-critical professional contractor.
We dove into the foot traffic data for three key players in the home improvement space – The Home Depot, Lowe’s Home Improvement, and Tractor Supply Co. – to examine how recent trends are impacting their strategy and driving visits.
Home Depot and Lowe’s: Going Pro
The pandemic gave a massive boost to the home improvement category, which makes for a tough year-over-year (YoY) comparison that has persisted throughout 2022. But although visit levels are reverting to the norm, the sector still appears to be weathering inflation – and home improvement leaders are making moves to increase their appeal among key consumers.
With the DIY-driven surge over, Home Depot and Lowe’s are now finding success by offering services that cater specifically to professional contractors. Home Depot has opened several flatbed distribution centers that can fulfill large orders and deliver directly to a construction site. Similarly, Lowe’s is piloting a Pro Fulfillment Center in Charlotte, NC, which provides a large assortment of construction materials available for next-day delivery.
Both chains already have loyalty programs – Lowe’s MVPs Pro Rewards and Home Depot’s Pro Xtra Loyalty Program – that cater to the pro customer, and the companies are looking to ramp up their appeal to this critical consumer segment. Lowe’s kicked off the month of November – or PROvember – with extra perks and a guidebook for pro customers. Home Depot also launched the Path to Pro Network – a jobseeker marketplace designed to help skilled tradespeople connect with contractors looking to hire.
The going-pro strategy appears to be yielding results. In recent weeks, Home Depot and Lowe’s year-over-three-year (Yo3Y) visits approached or surpassed pre-pandemic levels. The week of October 24th, 2022, Home Depot’s Yo3Y visit gap was only 2.6% while Lowe’s Yo3Y visits were 5.1% below the equivalent week in 2019.
Tractor Supply: A Rising Star
Unlike Home Depot and Lowe’s, Tractor Supply. isn’t focused on chasing the pro customers. The chain – primarily positioned in rural and agricultural markets – has focused instead on expansion of the brand.
Tractor Supply opened hundreds of new locations in recent years and is on track to open 75-80 locations in 2022. Adding to its rapid expansion, Tractor Supply recently acquired Orscheln Farm and Home and plans to rebrand some 81 of those locations as Tractor Supply stores.
As Tractor Supply cements its stronghold in rural markets, it has gained a significant foot traffic boost from migration trends away from cities and the rise of farming hobbyists since the onset of the pandemic.
Compared to 2019, Tractor Supply has experienced tremendous visit growth with weekly Yo3Y visits up 33.1% the week of October 24th, 2022. The chain’s YoY data shows weekly visits remained close to or above 2021 levels which indicates the sustained foot traffic growth of Tractor Supply.
The Home (Improvement) Stretch
A pandemic-induced DIY boom dominated the home improvement storylines in 2020 and 2021. But as construction and professional remodeling make a comeback in 2022, the leading narrative centers around cornering the pro customer market.
The home improvement space remains particularly resilient to macroeconomic turbulence as the category leaders continue to show their ability to capitalize on perpetually shifting trends.
For updates and more data-driven retail insights, visit Placer.ai.