Need a flat screen television, Xbox or treadmill? Don’t go to Homedepot.com.
There was a time, however, when the Atlanta-based retailer sold online all manner of things that couldn’t be hit with a hammer. Dinnerware by Pfaltzgraff, Ping-Pong tables, erupting volcano pool floats and twin-sized beds, to name a few.
“We strayed from what we should be,” said Hal Lawton, the 35-year-old president of Home Depot’s online operations. “We weren’t even selling patio sets online. We look at it now and think it’s crazy.”
Lawton is taking the Web site in a new direction. Move over table settings and electronics; here come 40 kinds of DeWalt drills.
As for patios, he expects to sell a lot of Martha Stewart Living outdoor sets because Homedepot.com is offering free shipping for orders of $249 or more.
Improving the Web site is an important new strategy for the No. 1 home improvement retailer.
Up to 50 percent of shoppers browse the Web before making a purchase, said Sucharita Mulpuru, a principal analyst of e-business with Forrester Research.
Web sales have grown to about 7 percent of total retail sales, she said, and that could grow to 20 percent in the next two decades.
Retailers like Home Depot can expect to make 2 percent to 10 percent of revenue from Web sales, she said.
Home Depot wouldn’t want to miss that opportunity. Revenue at the company dropped more than 7 percent to $66.2 billion in 2009 as the company continued to suffer from the housing downturn.
Analyst Mulpuru said that Home Depot’s site has been a mess, especially given the energy devoted to it over time. The number of items on the site and an old technology platform may have been part of the problem, she said.
“They had really bad product detail pages, search results and comparison functionality for many years,” Mulpuru said. “Hopefully they’ll fix that.”
Lawton is dedicated to simplifying the Web site, adding better search functions and making it a top source of information.
On the old Web site, it was hard to find the paint, let alone lists of painting supplies needed to do the job and guides on how to do it yourself.
Not on the new site. An “auto-fill” search function leads shoppers to how-to videos for more than 300 projects, how-to guides for more than 500 products, and thousands of product suggestions.
Lawton said Home Depot needed to make the site a source of information for the do-it-yourselfer, just like its stores. A video on the site about how to paint a room is short, detailed and streamed easily using the Firefox Web browser.
Lawton said Homedepot.com now has more than 100,000 items on it, compared with the average Home Depot store, which has 30,000 to 40,000.
His goal is to have about 300,000 products online. So if stores carry 10 types of DeWalt drills, the Web site would have 40 that meet specific needs, he said.
Other Web improvements that have rolled out or will soon:
- Returns or exchanges of online purchases will be taken at any store.
- Customers can post product reviews (like at Overstock.com or Amazon.com).
- Free shipping for orders of $249 or more and a shipping cost calculator.
- A design "visualizer" to see how a tile, paint or floor color would look in a room.
- Gift cards accepted for online purchases.
- A new iPhone application.
- A simplified mobile phone site to locate stores and find products.
- PayPal for online checkout.
Lawton said that the sins of Homedepot.com past can be blamed on best practices at the time.
It was unclear in the late 1990s and early 2000s how big the Internet would become, he said. Back then it was standard for some large retailers, such as Kmart and Barnes and Noble, to have Web sites that were not connected to their bricks-and-mortar stores.
“Up until a few years ago, it was a separate stovepipe,” at Home Depot, he said. “The Web site was not connected to stores and had a different merchandising team.” That led to a competition with stores for sales.
It also led to a lot of the goofy products being sold online.
Enter CEO Frank Blake, who in 2007 took the reins of the sprawling company and started narrowing its focus.
Within a few days of becoming CEO, Blake took the merchandising organization for Homedepot.com and embedded it with the store team, Lawton said.
So now when a customer buys a product on the Web it is credited to the nearest store.
Home Depot would not say how much it is spending on technology upgrades. However, in its most recent annual report the company said it spent $183.5 million on technology capital expenditures in fiscal 2009.
