Home Depot's Online Sales See 25 Percent Boost

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Home Depot's Online Sales See 25 Percent Boost

09/08/2015
Home Depot's sales for its 2015 second quarter were $24.8 billion, up 4.3% from last year, thanks in part to online sales growth. The company has been making moves to meet the new demand, including adding a new fulfillment center, which it expects to give 90% of its U.S. customers two-day or less parcel shipping.
 
"We had another quarter of strong growth in our digital assets with dotcom sales growing approximately 25%, led by online orders picked up in the store through Buy Online, Pick Up In Store (BOPUS) and Buy Online, Ship to Store (BOSS)," said aid Home Depot CEO Craig A. Menear. "At the same time, our operations team remains focused on improving the interconnected customer experience in the store."
 
The effort paid off, as Home Depot saw year-over-year improvement in customer satisfaction scores for its BOPUS and BOSS offerings in the second quarter. 

Meanwhile, its online channel represented 5% of sales in the second quarter. "Our dotcom team continues to expand our capabilities to solve our customers' needs through our online properties," said Menear.

In the second quarter, Home Depot improved its mobile experience, invested in content and made site improvements to "take friction out" for customers.

The company is also investing in its supply chain to support online growth, completing the build-out of a direct fulfillment center located in Troy Township, Ohio. The company plans to begin shipping product to customers out of this facility in the third quarter.

"This facility, along with our two other DFC's in California and Georgia, will give us the capability to reach 90% of our U.S. customers with two-day or less parcel shipping," said Menear.

Home Depot is in four markets with its Buy Online, Deliver From Store implementation. Virtually all of its stores are in the delivery business, but Home Depot is now enabling the buy online component. As part of that, the company seeks to enable tighter delivery windows.

"We're working to really perfect that and make that a flawless customer experience," said Mark Holifield, Executive VP-Supply Chain & Product Development.

"I would say that tighter time windows are harder to meet than all-day windows, so we want to be absolutely certain that we can meet those before we roll further, but we would expect to roll that through 2016."

In merchandising, Home Depot recently utilized its regional merchandising managers and planning and assortment tools to refine its assortment in cleaning. Based on customer demand and analytical data, the company has expanded its offering in the category. In addition to refreshes in subcategories like sponges, gloves, and brooms, the company expanded its air care and laundry offering and said it's very pleased with the results.