Lowe’s continues to build momentum with the pro customer segment, delivering mid-single-digit comps with the pro customer during the home-improvement retailer’s fiscal second quarter. The company was impacted by unfavorable weather and a pullback in DIY big ticket discretionary spending, which translated to a 5.1% decrease in comp sales and a decline in total sales on a year-over-year basis.
“As we look ahead, we are confident we are making the right long-term investments to take share when the market recovers,” Lowe’s chairman, president, and CEO Marvin Ellison said.
Executive vice president of stores Joseph McFarland said the company’s investments in job site delivery and “high-velocity pro SKUs” are “paying dividends,” allowing Lowe’s to more easily fulfill larger orders and replenish inventory.
“We’re delivering outsized growth in pro online sales as pros appreciate the enhanced online shopping experience that we’ve created specifically for them,” McFarland said. “Looking ahead, we were pleased to hear from pros on our recent survey that their backlogs remain healthy and consistent with last year. What’s also encouraging is that 75% of pros are confident in landing new business.’
During the company’s quarterly earnings call, Ellison said small to medium pros are responding to how Lowe’s has transformed its product and service offerings. The transformation of the company’s offering for pro customers began at the end of 2019, beginning with efforts to improve service levels.
“We talk a lot about job lot quantities, but we had to do that in a way where we gave pros confidence and also in a way that we would not leave our stores vulnerable for large purchases that we could replenish quickly,” Ellison said. “So after we established those foundational things, we knew that the next step was creating stickiness where you would give those customers a reason to shop us versus the competition, rolled out our loyalty program, and then rolled out a more sophisticated CRM platform.”
Ellison said the next phase of its pro evolution will be shared by new executive vice president of pro Quonta Vance at the upcoming Lowe’s analyst and investor conference.
“That [evolution] is going to have a lot to do with identifying segments of pro that we are barely scratching the surface today from a share standpoint that we’re going to start to pursue, in addition to ways we’re going to enhance fulfillment and how we’re going to be able to bring more a digitally friendly relationship with pros, so they could have a large selection of product choices and do it in a more seamless nature,” Ellison said.
During the fiscal second quarter, Lowe’s delivered above-average comps in rough plumbing, electrical, and millwork, and positive comps for building materials, driven by a continued growth in pro sales across all building materials subdivisions. In its appliance segment, the company delivered above-average comps and double-digit growth with pro customers, according to executive vice president of merchandising Bill Boltz.
