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Presented by:
ARE SUNNY SKIES AHEAD FOR THE 2013 HOME IMPROVEMENT SEASON?
Laura KennedySenior Analyst
Doug HermansonEconomist
June 7, 2013
Home Improvement Webinar Series
© Copyright 2013 Kantar Retail
Agenda
• Macroeconomic Outlook: Government Tax and Spend Effects from the Certain to the Possible
–Payroll tax and the “sequester”–Entitlement cuts
• Kantar Retail ShopperScape®: How Shoppers Are Approaching the Spring Home Improvement Season
• Project Intentions• Where They’ll Shop, and Why• How They’ll Plan
2
© Copyright 2013 Kantar Retail
Payroll Taxes and The Sequester
• Discretionary home and softgoods categories
• Nondiscretionary products with a stronger value proposition may benefit
• Regional markets with little to offset negative impact
• Haves and Have Nots in different ways
3
Uncertainty may be the biggest threat to growth
Payroll Tax Increase and Sequester Budget Cuts: Relative to Income Gains
2013 Full-Year Impact in Billions of Dollars
* Estimated assuming 2.5% to 3.0% income growth based on job growth of 1% to 1.5%Source: U.S. Department of Commerce and Kantar Retail
Who is affected?
© Copyright 2013 Kantar Retail 4
$25,000 $50,000 $100,000Salary
-$500 -$1,000 -$2,000Salary reduction from the
payroll tax increase
Payroll Tax: Facts•Payroll tax was lowered two percentage points in 2011 as a temporary stimulus measure
•Payroll tax brought back to its previous rate on January 1, 2013
Payroll Tax: Facts•Payroll tax was lowered two percentage points in 2011 as a temporary stimulus measure
•Payroll tax brought back to its previous rate on January 1, 2013
© Copyright 2013 Kantar Retail
65% 66%61%
35% 34%39%
All Shoppers Home Improvement Shoppers
Hardware Store Shoppers
Yes No
Have you noticed a difference in your take-home pay since the payroll tax rate increased?
(among past-4 week shoppers who receive a paycheck, e.g., not retired or unemployed)
5
*Read as: 66% of home improvement shoppers said they have noticed a difference in their take-home pay since the payroll tax increase.No significant differences compared with all shoppers at the 95% confidence levelAll shoppers n = 2514; Home Improvement n = 1106; Hardware Store n = 333
Source: Kantar Retail ShopperScape® , February 2013
Two-thirds of Home Improvement Shoppers Have Noticed Lower Take-Home Pay as a Result of the Payroll Tax Rate Increase
© Copyright 2013 Kantar Retail
All ShoppersHome Improvement
Retailers Hardware Stores
Eat out at restaurants less often 32% 34% 31%Use more coupons 32% 36% 33%Cut back on small indulgences 30% 33% 31%Cut back on more "discretionary" products 30% 32% 27%Cut back on everyday expenses 27% 28% 25%Buy less expensive versions of products 24% 25% 26%Stock up when retailers have specials deals 23% 27% 28%Purchase fewer "big ticket" items 21% 26% 26%Do more shopping at retailers that have good sales 18% 22% 23%Do more shopping at dollar stores 13% 15% 17%Postponing home improvement project 13% 17% 16%Do more shopping at Walmart 10% 12% 12%Other 1% 1% 1%Do not plan to change behavior 35% 33% 34%
Do not plan to change behavior or are not affected by payroll taxes 72% 73% 69%
Shading indicate significantly greater percentage compared with all shoppers; border indicates significantly lower percentage (95% confidence level). Behaviors apply to all shopping, not necessarily home improvement
6Source: Kantar Retail ShopperScape® , February 2013
Significantly more likely
than all shoppers to postpone HI projects, as well as shop at Walmart
Significantly more likely
than all shoppers to postpone HI projects, as well as shop at Walmart
Some Shoppers Indicate They Will Postpone HI Projects as a Way to Cope with Tax Increase
Affect of Payroll Tax Increase on Shopping, Spending Behavior(among past-4 week shoppers who receive a paycheck, e.g., not retired or unemployed)
Note: changing
behavior is in the
minority
Note: changing
behavior is in the
minority
© Copyright 2013 Kantar Retail
Affect of Payroll Tax Increase on Shopping, Spending Behavior(among past-4 week shoppers who receive a paycheck, e.g., not retired or unemployed)
27%
1%
18%
33%
35%
35%
27%
29%
22%
15%
21%
32%
36%
25%
38%
1%
15%
31%
33%
31%
27%
22%
20%
10%
11%
24%
34%
25%
0% 5% 10% 15% 20% 25% 30% 35% 40%
Do not plan to change my shopping behavior
Other
Postpone a home improvement/decorating project
Cut back on more "discretionary" products
Eat out at restaurants less often
Cut back on small indulgences
Stock up when retailers have specials deals
Buy less expensive versions of products
Do more shopping at retailers that have good sales
Do more shopping at Walmart
Do more shopping at dollar stores
Cut back on everyday expenses
Use more coupons
Purchase fewer "big ticket" items
Haves
Have Nots
Arrows indicate significant difference between column percentages (95% confidence level). Behaviors apply to all shopping, not necessarily home improvement. Have and Have Not distinctions are based on income levels of respondents.Haves n = 406; Have-nots n = 259
“Have-Not” and “Haves” Indicate Similar Behavior Toward Home Improvement Spending
7Source: Kantar Retail ShopperScape® , February 2013
© Copyright 2013 Kantar Retail
What is it?•Triggered by the inability of congress to reach a budget deal that cuts long-term spending
•Short term: 85 billion dollars of U.S. government cuts from March 1, 2013 to September 30, 2013.
•Long-term: 1.1 trillion dollars in U.S. government spending cuts through 2021.
What is it?•Triggered by the inability of congress to reach a budget deal that cuts long-term spending
•Short term: 85 billion dollars of U.S. government cuts from March 1, 2013 to September 30, 2013.
•Long-term: 1.1 trillion dollars in U.S. government spending cuts through 2021.
The “Sequester”: The Facts
Source: Pew Research Center, U.S. Congressional Budget Office, and Kantar Retail 8
What programs are affected?•Directly: Half the cuts are from discretionary military spending and the other half are from discretionary non-defense spending
•Indirectly: To a lesser degree funding for education and private-sector manufacturing
•Does not affect mandatory programs such Medicaid, Social Security and SNAP, but more on that later……..
What programs are affected?•Directly: Half the cuts are from discretionary military spending and the other half are from discretionary non-defense spending
•Indirectly: To a lesser degree funding for education and private-sector manufacturing
•Does not affect mandatory programs such Medicaid, Social Security and SNAP, but more on that later……..
What is the affect on retail?What is the affect on retail?
© Copyright 2013 Kantar Retail
1/6 have government jobs; much smaller number of jobs affected indirectly
9
To what extent are you concerned that government budget cuts known as 'the sequester 'may negatively impact the job security
of employed members of your household?
Source: Kantar Retail ShopperScape®, April 2013
Threat: More are Concerned Than Ought to Be
52%38%
10%
Concerned
Not Concerned
Don't know/not sure
Home Improvement and Hardware Shoppers
© Copyright 2013 Kantar Retail
Those that are concerned are significantly more likely to spend less
10
To what extent are you concerned that government budget cuts known as 'the sequester 'may negatively impact the job security
of employed members of your household?
Source: Kantar Retail ShopperScape®, April 2013
Threat: More are Concerned Than Ought to Be
Home Improvement and Hardware Shoppers
Concerned
Not Concerned
Don't know/not sure
Signicantly more likely to spend less
© Copyright 2013 Kantar Retail
The Sequester—and Other Regional Effects
11
The growth threats are often focused, if not offset
* Ranging from about 1 of every 3 jobs in Washington D.C. to about 1 of every 5 jobs in Virginia.
Source: Kantar Retail analysis
Washington D.C.Wyoming
AlaskaNew Mexico
MississippiOklahoma
HawaiiWest Virginia
MontanaAlabamaMaryland
Virginia
Vulnerable States With Highest Share of Government Jobs*
Other Vulnerable States
Most vulnerable are these states
where recovery has lagged the
most
Most vulnerable are these states
where recovery has lagged the
most
MaineMissouriNevadaRhode Island
© Copyright 2013 Kantar Retail
Hawaii
CT
Rising Home Prices as Key Recovery Indicator
12
They create job and wealth gains that vary across states
• Home prices in 10 states back up above pre-recession peak
• More states seeing sizeable jump in home prices from recession low
.
States by Home Prices
Source: U.S. Bureau of Labor Statistics, Federal Housing Finance Agency, and Kantar Retail
*Measures current home prices (through Q1 2013) relative to pre-recession peak
Home Prices vs. Pre-Recession Peak*
Alaska
At or above pre-recession peakDown less than 10% from peakDown 10 to 24% from peakDown more than 25% from peak
Prices up 8.0% or more from lowHome prices remain near low
Home Prices vs. Recession Low Point**
**Measures current home prices (through Q1 2013) relative to recession low point
D.C
© Copyright 2013 Kantar Retail
Apr-12 Mar-13 Apr-13
(a) (b) (c)
Much/Somewhat Better Off 20% 23% a c 20%
Job security No Change from Last Year 61% b 59% 64% b
Somewhat/Much Worse Off 19% c 18% 16%
Much/Somewhat Better Off 31% 31% 31%
Household income level No Change from Last Year 45% 43% 46% b
Somewhat/Much Worse Off 25% 26% c 23%
Much/Somewhat Better Off 26% 31% a 29% a
Credit card debt level No Change from Last Year 58% b 53% 57% b
Somewhat/Much Worse Off 16% 15% 14%
Much/Somewhat Better Off 23% 27% a 25%
Monthly mortgage and car payments No Change from Last Year 65% b 61% 64% b
Somewhat/Much Worse Off 12% 12% 11%
Much/Somewhat Better Off 30% 35% a 33% a
Worth of investments No Change from Last Year 50% 49% 51%
Somewhat/Much Worse Off 20% b c 17% 15%
Much/Somewhat Better Off 22% 33% a 34% a
Value of my home No Change from Last Year 51% c 49% 48%
Somewhat/Much Worse Off 26% b c 18% 18%
Note: Superscript letters indicate a signif icant difference betw een time periods (90% confidence level)
Home Improvement/Hardware Store Shoppers' Perceived Household Financial Health Compared with Last Year
Financial Health of Home Improvement Shoppers is Holding Up
Source: Kantar Retail ShopperScape®, April 2012, March 2013 & April 2013
Feelings about investments, home
values have improved significantly from last from the same time
last year
Feelings about investments, home
values have improved significantly from last from the same time
last year
Scant signs that shoppers are feeling
worse off about incomes and job
security in the wake of government tax and spend effects
Scant signs that shoppers are feeling
worse off about incomes and job
security in the wake of government tax and spend effects
© Copyright 2013 Kantar Retail
161
209 206
165
2004-2007 2012 Q1 2013 Apr-13
Job Growth: Holding up in 2013
14
Strong Q1 followed by moderate April gains
Source: U.S. Department of Labor and Kantar Retail
Monthly U.S. Job GrowthAverage Month-to-Month Change in Jobs in Thousands
• Unemployment rate trends suggest Have Not job gains have picked up in recent months —construction and retail
• Economy added another 175,000 jobs in May
Pre-Recession
Trend
© Copyright 2013 Kantar Retail
40%
45%
50%
55%
60%
65%
70%
75%
80%
Suggests uncertainty having greater effect on “Haves” spending plans
15
Haves* (annual HH
income $60k+)
Have Nots (annual HH
income <$60k)
All Home Improvement
Shoppers
Have & Have Nots: Percent of Home ImprovementShoppers Planning to Spend
About the Same or More (three-month moving average)
Source: Kantar Retail ShopperScape®, January 2009–April 2013
*Read as: 75% of upper-income home improvement/hardware store shoppers surveyed in April 2013 indicated plans to spend about the same or more at retail in the coming month.Note: Refers to spending at retail in general, not necessarily at home improvement and hardware store retailers
“Have” Households Gaining after Leading Falloff; “Have Nots” More Resilient, but Leveling Off
© Copyright 2013 Kantar Retail
-2%
26%
-4%
42%
1%
39%
-2%
36%
-8%
60%
-3%
75%
Defict Debt
16
• Even planned budget cuts (i.e., “sequester”) will mean persisting deficits, elevated debt levels
• Points to need for additional measures to put government on a sustainable path
U.S. Government Debt and Budget Deficit*As Share of Gross Domestic Product
Source: U.S. Congressional Budget Office and Kantar Retail
U.S. Government Spending: The ProblemPersisting budget deficits and accumulating debt
1997–20011982–19961970s 2002–2007 2008–2012 2013–2020F
Deficit worsened past 4 years, hitting bottom at -10% of GDP in 2009
Accumulated government debt is projected to stay elevated through 2020
*Projections through 2020 include “sequester” budget cuts triggered on March 1, unless Congress approves alternative budget plan
After 2020, projected to worsen again
toward 4% deficits
© Copyright 2013 Kantar Retail
38%
45% 47%
55%57%
61%
1972 1982 1992 2002 2012 2020F
17
• Under current CBO projections, these programs will approach 2/3 of all government spending after 2020
• Will mean reversal of government spending priorities of 40 years ago
Share of Government Spending: Entitlement & Other “Mandatory” Programs
Source: U.S. Congressional Budget Office and Kantar Retail
Ultimate Targets: Entitlement ProgramsSocial Security, Medicare, health care spending, etc. …
© Copyright 2013 Kantar Retail
38%
45% 47%
55%57%
61%
1972 1982 1992 2002 2012 2020F
18
• A serious effort to control spending would mean unpopular choices:
– New constraints on Social Security eligibility and benefits?
– Active restraint of health care costs via Medicare, Medicaid, health care exchanges?
Share of Government Spending: Entitlement & Other “Mandatory” Programs
Source: U.S. Congressional Budget Office and Kantar Retail
Biggest Drivers: Social Security & MedicareHealth care reform programs will add to entitlement growth
Social Security & MedicareMedicaid & Health Care Reform ProgramsIncome programs including SNAPOther programs (e.g., for Federal Workers, Military, Veterans, etc.)
© Copyright 2013 Kantar Retail
66% 67% 69% 72% 72% 74%
1971 1981 1991 2001 2011 2020FC
34% 33% 31% 28% 28% 26%
1971 1981 1991 2001 2011 2020FC
Government Cuts Will Hit “Have Nots” Hardest
19
Their share of income is falling even with government aid
60% households 40% of households
“Have Nots” “Haves”
Falling Share of All Income Sources Rising Share of All Income Sources
~25% income < $62,000 Per Year
~75% of income> $62,000 Per Year Household IncomePay
chec
k
Paych
eck
$
Source: U.S. Department of Commerce, Congressional Budget Office, and Kantar Retail analysis
© Copyright 2013 Kantar Retail
66% 67% 69% 72% 72% 74%
1971 1981 1991 2001 2011 2020FC
34% 33% 31% 28% 28% 26%
1971 1981 1991 2001 2011 2020FC
Government Aid = About 1/3 of Have Not Income
20
Grown significantly in 40 years, especially last few years
60% households 40% of households
“Have Nots” “Haves”
~25% income < $62,000 Per Year
~75% of income> $62,000 Per Year Household IncomePay
chec
k
Paych
eck
$
Source: U.S. Department of Commerce, and Kantar Retail analysis 3%97% 8%92%
Government Entitlement, Assistance Programs
20%
80%
35%
65%
Growing Reliance on Government
Falling Share of All Income Sources
© Copyright 2013 Kantar Retail
Key Takeaways: Macroeconomic Outlook• Payroll tax increase may dampen or delay, but not derail most
purchases
• Uncertainty is the biggest threat from the “Sequester”
• If there is a noticeable impact from the “Sequester” it will be regional, especially among states lagging the recovery
• Haves’ spending plans are more affected by budget uncertainty
• Have Nots are more focused on month-to-month job gains/losses
• In the long-term, spending of “boomers” and lower-income households possibly hurt by future cuts to entitlements
Source: Kantar Retail analysis 21
© Copyright 2013 Kantar Retail
Agenda
• Macroeconomic Outlook: Government Tax and Spend Effects from the Certain to the Possible
–Payroll tax and the “sequester”–Entitlement cuts
• Kantar Retail ShopperScape®: How Shoppers Are Approaching the Spring Home Improvement Season
• Project intentions• Where they’ll shop• How they’ll plan• How retailers are reacting
22
© Copyright 2013 Kantar RetailSource: Kantar Retail ShopperScape®, April 2013 23“Lowe’s shoppers” are past-four-week Lowe’s shoppers; significant differences are at a 95% confidence level
Home Improvement Shoppers More Likely to Have Long-Term Relationships with Homes
Shoppers’ Descriptions of Their
Relationships with Their Homes or
Where They Live (among all shoppers)
Shoppers’ Descriptions of Their
Relationships with Their Homes or
Where They Live (among all shoppers)
51% of home improvement
shoppers; Gen Y, Gen X, and “Have Nots” less likely
51% of home improvement
shoppers; Gen Y, Gen X, and “Have Nots” less likely
Gen Y, Gen X making new-household changesGen Y, Gen X making
new-household changes
Home improvement/hardware
store shoppers more likely
Home improvement/hardware
store shoppers more likely
HI shoppers less likely; Gen Y, Gen X, and Have
Nots more likely
HI shoppers less likely; Gen Y, Gen X, and Have
Nots more likely
47% of home improvement shoppers
47% of home improvement shoppers
© Copyright 2013 Kantar Retail
Only Slightly Higher Project Intentions in 2013Is government uncertainty further delaying spending?
Source: Kantar Retail ShopperScape®, April 2013 24
This year, Gen X and “Have” shoppers (incomes
$60K+) are more likely than all shoppers to plan
projects
This year, Gen X and “Have” shoppers (incomes
$60K+) are more likely than all shoppers to plan
projects
Last year the warm winter resulted in
shoppers spending before traditional
spring months
Last year the warm winter resulted in
shoppers spending before traditional
spring months
© Copyright 2013 Kantar Retail
But Men Could Drive SpendingSignificantly more men than women plan projects, and higher shares of men plan projects than in 2012
Source: Kantar Retail ShopperScape®, April 2013 25
Likelihood of Initiating a Home Improvement Project in the Next Six Months
(Among all shoppers)
Bolded and underlined percentages are significantly greater than female and 2012 percentages at a 95% confidence
© Copyright 2013 Kantar Retail
Outdoor Project Plans Still Rank HighestSignificantly fewer shoppers plan large-ticket projects like a new kitchen or roof
Source: Kantar Retail ShopperScape®, April 2013 26
Bolded and underlined percentages are significantly greater than 2012 percentages at a 95% confidence
© Copyright 2013 Kantar Retail
Still, Shoppers Are Gradually Shifting Away from the Cheapest Projects
Source: Kantar Retail ShopperScape®, April 2013 27
Bolded and underlined percentages are significantly greater than 2011 percentages at a 95% confidence
© Copyright 2013 Kantar Retail
A Discretionary Spending Option: Retailers Push Outdoor Entertaining
Source: Kantar Retail store visits, Lowe’s circular 28
© Copyright 2013 Kantar Retail
But Price Remains a Focus
Source: Kantar Retail store visits 29
“It does take a while depending on the traffic hitting that category for the customer to
encounter those values, to encounter the new ranges and market assorting impacts.” –Greg
Bridgeford, Lowe’s Chief Customer officer
“It does take a while depending on the traffic hitting that category for the customer to
encounter those values, to encounter the new ranges and market assorting impacts.” –Greg
Bridgeford, Lowe’s Chief Customer officer
© Copyright 2013 Kantar Retail
Remember the Options: Value Discounters Offer Convenience, Price, Low Commitment
30Source: Kantar Retail store visits
What are HI retailers’ comparative value propositions, price
justifications?
What are HI retailers’ comparative value propositions, price
justifications?
At the same time, THD and Lowe’s sell more
cheap toolsets…
At the same time, THD and Lowe’s sell more
cheap toolsets…
© Copyright 2013 Kantar Retail
Shoppers Consider Home Depot the Price LeaderHome Depot viewed as the price leader versus Lowe’s
Source: Kantar Retail ShopperScape®, April 2013 31
Retailer Viewed as Price Leader for Home Improvement Products (among shoppers who purchase home improvement products)
Significantly greater shares of home
improvement purchasers name Home Depot as
the price leader vs. Lowe’s
Significantly greater shares of home
improvement purchasers name Home Depot as
the price leader vs. Lowe’s
Gen Y and Gen X
overindex on Amazon as
the price leader
Gen Y and Gen X
overindex on Amazon as
the price leader
“Haves” shoppers are also more likely than all shoppers to
see HD as price leader
“Haves” shoppers are also more likely than all shoppers to
see HD as price leader
Lowe’s shoppers are past-four-week shoppers. Underlined and bold percentage is significantly greater than percentage of home improvement shoppers who believe Lowe’s is the price leader, at 95% confidence
© Copyright 2013 Kantar Retail
Up-Market Shoppers More Likely to Use Credit for Upcoming Projects
All Shoppers
Have-nots (< $60,000)
Haves ($60,000+)
Pay up front with cash/debit/check 65% 66% 63%Credit card not affiliated with a retailer 15% 12% 18%Retailer credit card (e.g., Lowe's or Home Depot credit card) 9% 8% 10%Use retailer's financing offer (e.g., delay payments, no interest until 2014, etc.) 5% 4% 6%Finance project through a contractor 3% 2% 4%Get a home equity loan 3% 2% 3%Get a loan from a bank/financial institution that is NOT a home equity loan 2% 2% 3%Get a loan from a family member/friend 2% 2% 1%Don't know 10% 12% 8%Prefer not to answer 2% 3% 1%
Credit availability still hampering lower-income shoppers
Source: Kantar Retail ShopperScape®, April 2013 32
Bolded and underlined percentages are significantly greater than all shoppers at a 95% confidence; outlinedpercentages are significantly lower
© Copyright 2013 Kantar Retail
Meanwhile, Shoppers Are More Willing to Pay Others to Do the Work—But Is It Plateauing?
Source: Kantar Retail ShopperScape®, April 2010-2013 33
Approaches to Their Next Home Improvement Project
Among shoppers who are likely to initiate a project in the next six months
© Copyright 2013 Kantar Retail
Gen Y Still Views Retailers as a Trusted Source for Home Improvement
34
Approaches to Their Next Home Improvement Project
Among shoppers who are likely to initiate a project in the next six months
Source: Kantar Retail ShopperScape®, April 2013
Bolded and underlined percentages are significantly greater than all shoppers at a 95% confidence
© Copyright 2013 Kantar Retail
Ikea: A New Model for Home Improvement?
35Source: Kantar Retail store visits
Plus: cheap toolsPlus: cheap tools
Installation servicesInstallation services Appliances et al. Ikea-branded
Appliances et al. Ikea-branded
© Copyright 2013 Kantar Retail
More Variety: More Consumers Plan to Shop Lawn and Garden Retailers This Year
Source: Kantar Retail ShopperScape®, April 2013 36
54.9%55.4%
Where Shoppers Are Likely to Shop for Materials for Their Next Home Improvement Project
(Among shoppers planning a project and planning to buy their own materials)
Boomers and “Haves” (incomes $60,000+) more likely to shop Home Depot
Boomers and “Haves” (incomes $60,000+) more likely to shop Home Depot
Bolded and underlined percentages are significantly greater than 2012 at a 95% confidence
© Copyright 2013 Kantar Retail
Gen Y Is More Likely to Shop Online and at Smaller Boxes; Less Likely at HD or LOW
Source: Kantar Retail ShopperScape®, April 2013 37
54.9%55.4%
Where Shoppers Are Likely to Shop for Materials for Their Next Home Improvement Project
(Among shoppers planning a project and planning to buy their own materials)
Bolded and underlined percentages are significantly greater than 2012 at a 95% confidence
© Copyright 2013 Kantar Retail
“Have Nots” More Likely to Shop Ace, True Value, and Hardware Stores
Source: Kantar Retail ShopperScape®, April 2013 38
54.9%55.4%
Where Shoppers Are Likely to Shop for Materials for Their Next Home Improvement Project
(Among shoppers planning a project and planning to buy their own materials)
Bolded and underlined percentages are significantly greater than 2012 at a 95% confidence
© Copyright 2013 Kantar Retail
Big-Box Garden Centers Feature More Solutions, Guidance—Targeting the Specialists?
Source: Kantar Retail store visits 39
Mostly branded displays…but some
retailer guidance
Mostly branded displays…but some
retailer guidance
Gardening “kits” cater to novices as well as smaller residences
Gardening “kits” cater to novices as well as smaller residences
© Copyright 2013 Kantar Retail
Traditional and Digital Means of Trip Preparation Both Increase in 2013
40Source: Kantar Retail ShopperScape®, April 2013
Methods of Preparation Before a Trip to a Home Improvement Retailer
(All or most of the time, among home improvement store and
hardware store shoppers)
Methods of Preparation Before a Trip to a Home Improvement Retailer
(All or most of the time, among home improvement store and
hardware store shoppers)
Bolded and underlined percentages are significantly greater than 2012 at a 95% confidence
© Copyright 2013 Kantar Retail
Gen Y, Gen X Far More Likely to Use Digital Tools
41Source: Kantar Retail ShopperScape®, April 2013
Methods of Preparation Before a Trip to a Home Improvement Retailer
(All or most of the time, among home improvement store and
hardware store shoppers)
Methods of Preparation Before a Trip to a Home Improvement Retailer
(All or most of the time, among home improvement store and
hardware store shoppers)
© Copyright 2013 Kantar Retail
Digital Integration In-Store Is Still Slow…Lowe’s focuses on QR codes and MS codes, especially in garden
Source: Kantar Retail store visits 42
© Copyright 2013 Kantar Retail 43
Home Depot Makes the Big Box Smaller with Mobile Store Maps and Item Locator
Source: Home Depot’s iPhone app
© Copyright 2013 Kantar Retail
Lowe’s Reaches Out with Weekly Localized and Personalized Spring Tip Emails
Source: Home Depot circular, Lowe’s emails, Kantar Retail research and analysis 44
Also features “spring video series”
Also features “spring video series”
Tailors projects to type of home, location—though weather doesn’t always
coincide with project suggestion
Tailors projects to type of home, location—though weather doesn’t always
coincide with project suggestion
© Copyright 2013 Kantar Retail
Key Takeaways: Spring Projects 2013• The strengthened housing market isn’t enough. Gen X and
upper-incomers are more likely to start projects soon, but by and large shoppers remain conservative with their home improvement project plans.
• Brands can help shoppers stretch their budgets. Retailers and shoppers are prioritizing solutions and guidance as value-adds in a tight environment. Find a place in a low-cost discretionary solution to help drive sales and baskets.
• The balance between value and price will be crucial. Even as shoppers remain thoughtful about their home improvement spending, retailers that can provide “something extra”—including better digital tools—will drive traffic and bigger tickets.
Source: Kantar Retail analysis 45
© Copyright 2013 Kantar Retail
501 Boylston StreetSuite 6101Boston, MA02116
F +1 630 245 5647
www.KantarRetailiq.com
Two Easton OvalSuite 500Columbus, Ohio43219
F +1 630 245 5647
www.KantarRetailiq.com
Laura Kennedy
Senior Analyst
T +1 617 912 2851
Doug Hermanson
Economist
T +1 614 355 4044