Lowe's is approaching its pro-focused business journey in phases. The first phase, which began after CEO and president Marvin Ellison pinpointed service to professional customers as a priority in the fourth quarter of 2018, involves installing the fundamentals to build a foundation of loyalty with pro businesses.
Building the pro side of the business is like a football game, according to Lowe’s senior vice president of pro sales and services Fred Stokes. Lowe’s must take small wins in its pro business before it can throw the ball down the field later in the game. After completing the installation of many of the pro-focused fundamentals, the home improvement retailer will now test several pro initiatives in the back half of the year, entering the second phase of its pro journey.
“We can’t play this [pro] game unless we come out with a pro loyalty program,” Stokes said. “We’re going to test and learn [with the pro loyalty program], we’re going to test and learn with certain merchandising events, we’re going to test and learn with a CRM tool, we’re going to educate our people, [and] we’re going to come out with a learning and development type initiative.”
In addition to testing new pro initiatives, Stokes said the home improvement retailer will also create a “level of stickiness” with the fundamentals it has put in place. Stokes said the retailer will continue to work toward making the pro feel like a valued customer.
Installing a foundation to build with the pro customer involved focusing on developing several core areas, according to Stokes. This first involved solving out-of-stock issues and investing in job-lot quantity to provide pros with sufficient inventory to complete a job. Lowe’s has also added 18 different leadership positions and department supervisors for pros and lumber and building materials in the first half of the year.
“You’ve got to have associates working with the customers in the building,” Stokes said. “Everybody has got to know their role and their routine on how we deliver service in the aisles to the pro customer.”
Stokes said the final area of focus for the business has been holding itself accountable for its performance. Installing and putting an emphasis on the fundamentals has helped focus Lowe’s on pro customers and allowed the retailer to put on several pro appreciation events. The pro appreciation event in Q2 garnered over 35,000 new pro accounts for Lowe’s, which Stokes said the company estimates could represent nearly $100 million in future revenue. Stokes said Lowe’s is also evaluating how its LowesForPros.com platform can better serve the pros, and will leverage the resources available at the company’s new technology hub in Charlotte, N.C.
Included with the retailer’s commitment to the fundamentals is a continued focus on service, inventory, and customer experience, Stokes said, even as it tests initiatives in the second half of 2019. “We’re not going to get out there too far right now, there’s a lot of low-hanging fruit that our customers expect us to have,” Stokes said. “I don’t want to continue to focus on anything else than to deliver the fundamentals that we are installing today. There are a couple things that we will potentially go after, but if we don’t focus on the fundamentals, then we can’t claim the space.”
