There are some major changes coming to the online retail world as well as the home improvement industry in 2018. Home Depot recently announced that is has acquired The Company Store, an e-commerce retailer of home goods and textiles. Experts believe this is a sign the home improvement giant may be going after Amazon’s e-commerce turf.
According to Retail Dive, Hanover Direct previously owned The Company Store, but plans to sell the online retailer to Home Depot were finalized on December 19.
The Company Store was founded in 1911 in Wisconsin; there are also five physical locations that will not be part of Home Depot’s acquisition.
“We are building the capability and investing to tailor our messages and scale,” said Kevin Hofmann, Home Depot’s president of e-commerce. “We’ve grown the online business by approximately $1 billion in each of the last four year… so these interconnected retail efforts continue to be a key growth engine for our overall business. And over the last few years, they’ve contributed approximately 20% of the company’s total growth.”
The entire U.S. e-commerce industry is rapidly growing, with revenue sitting at approximately $423.2 billion. And Home Depot wants to improve its digital presence as well, especially as more homeowners are looking to purchase items for home remolding projects. A recent survey found that nearly two-thirds of U.S. consumers are planning on renovating their homes.
Hofmann also states that Home Depot’s e-commerce sales as of late were at 6.4%, roughly double their closest competitor, Lowe’s.
“The Company Store is highly recognized and a staple in many households who are buying direct and have been for over 100 years,” said Jim Fosina, CEO of Fosina Marketing Group. “Consumers want more one-stop shop options in the verticals like home improvement by renovation, repair or decor that are available at multiple touch points, both direct and retail. Good move by both companies who clearly see the opportunity for their brands to reach broader into gender, channel and complementary products offerings and maybe even services. The Company Store’s long time database of direct to consumer customers will prove to be a highly valuable asset to the Home Depot in reaching more customers.”
Currently, 60% of Home Depot’s sales (in-store or online) are influenced by a digital visit. And the recent acquisition of The Company Store will only drive that number higher. Home Depot expects to surpass 1.8 billion digital visits in 2018, rivaling just about any competitor and its own transactions inside physical stores.
“Customers are moving online to begin the shopping experience in this space, and we will invest to connect our services business to the digital world,” added Craig Menear, CEO of Home Depot. “The front door of our store is no longer at the front door of our stores. It’s in the customer’s pocket. It’s on the job site. It’s in their home.”
