for Between the Lines
| November 19, 2019 — 16:28 GMT (16:28 GMT)
| Topic: Digital Transformation
Home Depot said that its One Home Depot digital transformation project is delivering returns slower than expected and will cut into sales growth.
As a refresher, Home Depot last year outlined an ambitious strategy to meld its supply chain, digital footprint and physical store experience. Analytics and data would be the glue of this digital transformation.
In a graphic, here’s the retailer’s One Home Depot strategy.
We have foundational IT work streams supporting many of our strategic initiatives that will significantly enhance our ability to serve our customers in an interconnected way. Much of this IT work requires unwinding our legacy systems, and that has proven to be more complex than originally anticipated.
Take the B2B website experience, for example. Our investments in a personalized B2B website experience is a significant component of the unique value proposition we are creating for our pros. As you would expect, the most engaged customer cohort is 135,000 pros that we on-boarded at the beginning of the year, and we are seeing meaningful lift in spend as these customers become more familiar with the new experience. The rollout of the B2B site experience itself is on track, but underlying IT work must be completed before turning on additional elements of personalization and functionality for our larger pro customers.
Pro sales outpaced do it yourself demand in the third quarter. Ticket and transactions grew in the quarter. The Home Depot one site has seen traffic growth and better conversion rates due to fulfillment options and the omnichannel experience. Online sales were up 22% in the third quarter and “we also continue to leverage our digital platforms to drive incremental growth from adjacent categories like HD Home, Cool and Workwear and are seeing good traction across all of these categories.”More than 50% of online orders were picked up in stores.
“As we approach the end of the second year of our transformative One Home Depot investments, we have even more conviction today that we are making the right long-term investments for the business to extend our competitive advantage in the marketplace. As with any transformation, the work we are doing is complex, and I’m proud of the way our team is consistently up for the challenge,” said Menear.
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Digital Transformation: A CXOs Guide
for Between the Lines
| November 19, 2019 — 16:28 GMT (16:28 GMT)
| Topic: Digital Transformation