The Home Depot launched its "First for Pro" program during the first quarter and improved professional satisfaction with the home improvement big-box retailer, according to company officials during today's first quarter earnings conference call. The program, designed to draw in more professional sales with faster service and easier check-out, was first announced during last December's shareholder conference.
"In serving our pro customers, time is money," said executive vice president of U.S. stores Marvin Ellison. "We need to get them in and out fast."
The company also announced first quarter earnings for the three months ended May 1. During that time, the Atlanta-based company improved net earnings by 12%, compared with the same period last year, to $812 million despite a 0.2% decrease in sales to finish at $16.82 billion. Operating income for the quarter jumped 9% to $1.42 billion. While the initiative did raise professional customer satisfaction, the company has yet to see a full recovery of professional sales and big ticket items.
Average ticket cost increased by over 75 cents between first quarter 2010 and first quarter 2011 to $53.35. The company also saw customer transactions fall by 1.9%, compared with the opening quarter of 2010, to 317 million. Poor spring weather, especially in the Northeast and East Coast, was cited as the main reason for the decline in sales and transactions.
In order to better serve professional customers, as well as regular customers, the retailer has introduced new technology such as the "First Phone," which is a multipurpose hand-held device that employees can use to check-out customers, as well as an inventory tracker and source of information about products.
The Home Depot has sought in the past to reach out to the pro, most notably with HD Supply, a pro-oriented operation that included several dozen lumberyards in Florida and Georgia as well as a set of repair and remodel stores in the Los Angeles area. The Home Depot eventually spun off HD Supply under pressure from shareholders, who wanted The Home Depot to concentrate on its retail operations. It did, but ever since the spinoff of HD Supply, The Home Depot has continued to make "own the pro" one of its key objectives.
Ellison said that in developing the "First for Pro" program, the company went deeper into its analytics and reviewed the shopping habits of professionals at its stores. He said Home Depot officials reviewed when, at what locations, and in what departments professionals shopped in. They wanted to understand the professionals and better serve them, Ellison said.
Officials for the world's largest home improvement retail company also said they would focus on using analytics and information about customers, including professional customers, when advertising. One company official said The Home Depots wants to "know whether they are dealing with a roofer with five employees or a master electrician with no employees" so the company can focus its marketing accordingly.
The Home Depot operates more than 2,200 stores in the U.S., Mexico, China, and Canada.