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Tuesday, November 13, 2007

Roger Adams Remodels Home Depot Brand

How might you remodel the Home Depot brand?

That's what Home Depot's Chief Marketing Officer, Roger Adams, addressed at the Association of National Advertisers annual meeting in October.

I found the presentation fascinating. Adams made sense; the programs he described combined the knowhow expertise that Home Depot has been known for with a focus on the different needs of women, Hispanic and African American consumers. I left thinking that maybe Home Depot was back on track. And, yet, Roger Adams - in position for approximately one year - left the week after this presentation. [See Home Depot's Dilemma: How Much Can A CMO Fix? by Sarah Mahoney on 10/19/2007.]

According to Adams, Home Depot is the 8th largest employer in the US with 350k associates. Its growth has been fueled by price, selection, and service. The original premise was based on the simple idea of making pro brands available to all without price discrimination. Associates were hired from the trades to bring specific knowledge and experience to customer interactions.

Home Depot creates an emotional connection to its brand through the notion of "I did it." It's about giving consumers the confidence to try a project; helping them develop a sense of personal ownership and empowerment because they actually did the project themselves. Experienced associates represent a teaching base to communicate and engage consumers across a rational/emotional continuum that recognizes that the home represents an individual's identity, and the most expensive and expressive badge of color, individual style and personality.

Adams says that price is not a key driver for consumers. Rather, it is a matter of how satisfied they are with the fun factor of the store, whether the store is friendly, how knowledgeable associates are and how well organized the store is.

Women Consumers
The market has changed considerably. From a consumer perspective, female decision makers account for 2/3 of the business. They aren't just looking for decor related items. Rising home ownership means that they want to know how to do and fix things themselves -- learning at their own pace.

Through the "Do-It-Herself" workshops, Home Depot has successfully engaged and empowered women. To date, over 200,000 women have participated across the country, and the momentum continues. It has resulted in a huge base of loyal consumers who get the word out. Home Depot does not promote the workshops via mass media.

Interestingly, the workshops are online driven, with customers developing topics. The online site offers additional web-based training, podcasts and registration for in-store events.

Hispanic Growth
Home Depot has also seen a growth in Hispanic customers. As first time homeowners, they have a high comfort in DIY and require more product information, the right assortment to choose from that is relevant to the hispanic culture. Home Depot engages with them via projects and context and has been successful creating an emotional connection by letting them tell their own story [Adams showed an advertising clip showing a Hispanic family speaking in both Spanish and English].

African American Growth
African Americans are ready for home improvement. Although intimidated by some projects, more women are purchasing homes. They want knowledge more than any other segment. Home Depot engages them with fun know-how.

For example, it has successfully connected via Urban radio and Steve Harvey [see Steve Harvey going against the grain. ‘King of Comedy’ brings civility, God, and big ratings, to morning radio] who does a lot of home improvements himself. In one year, Home Depot saw its awareness improve considerably.

Online, Steve Harvey offers how-to workshops.

In addition to the Steve Harvey celebrity seminars, Home Depot offers Ed Begley, Jr. seminars promoting its "Eco Options" product ideas. These cut across categories, using a classification system similar to Energy Star.

Despite the market being down, Home Depot is focusing on the customer again, investing in store labor and paying closer attention to customer service. Master trade specialists are returning, and associates have taken to the "orange juiced associates program". As a result, morale is up, attrition is down, and customer scores are up.

Engage the Community
Community activities represent a strong part of the Home Depot DNA, according to Adams. The NFL Neighborhood MVP Program, for example, creates a local connection, involving NFL fans, to do good in urban communities.

Home Depot is learning that, to engage the customer, it must forge an emotional connection through giving away knowhow, and being honest. It can inspire customers to do more, by understanding their dreams, and helping them fulfill those dreams. An effective way of conveying that commitment is by letting consumers tell their story, and filming that in a documentary approach. [For example, Reginald's Story.] This puts the consumer in control of mass communications. [View all stories!]

This Advertising Age interview from 10/09/2007 took place right before Roger Adams' presentation took place: Home Depot CMO: We Need to 'Start All Over' Q&A: Roger Adams Wants Retailer to Refocus Efforts on Service, Other Basics by Mya Frazier.

I guess we'll have to wait a bit longer for Home Depot to get back on track.

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Anonymous said...

Home Depot faces a strategic challenge. Rough analog - Home Depot is the Wal-Mart of big-box DIY, and Lowe's the Target. DIY's however have more money than do Wal-Mart shppers - they own homes/residences (who is going to do major DIY improvements in a rental?) Lowe's appeals to the higher incomed segment - and will long term, past any "housing crisis" of the moment. It is no wonder that Home Depot is continually looking over its shoulder..There are solutions of course. That's the business we are in as consultants - targeting, positioning, branding...

CB Whittemore said...

Robert, you make very interesting points, that I hadn't fully considered. I prefer Lowe's because of its better retail experience; I've always felt uncomfortable in Home Depot which appeals to hard-core building and construction types. I've not thought of the differences in socio-economic terms.... Thanks for commenting and sharing your perspective.

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Reminder: Please, no self-promotional or SPAM comments. Don't bother if you're simply trying to build inauthentic link juice. Finally, don't be anonymous: it's too hard to have a conversation. Thanks, CB

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