Reclaiming pro business with an increased focus on the customer base has been a point of emphasis at Lowe’s since CEO and president Marvin Ellison joined the retailer in July of 2018. After nearly a year of focus on improving retail fundamentals for the pro market, Lowe’s is ready to transition towards strategic pro initiatives, executive vice president of stores Joseph McFarland said on the company’s third quarter earnings call.
In the past year, Lowe’s has improved its pro presence by executing on “basic fundamentals” such as improving job lot quantities, improving associate service levels, adding dedicated pro loaders and pro department supervisors, and improving consistent volume pricing, according to McFarland.
“Our focus on the pro continues to be a catalyst for our U.S. sales growth and during the quarter, we continued to receive very positive customer feedback from pros experiencing first-hand what is new and different at Lowe’s and we’re pleased with the pro’s willingness to grow their business with us,” Ellison said on the third quarter earnings call.
Lowe’s held a pro appreciation event in the third quarter, as it has in previous quarters, to build loyalty and demonstrate to pros how the company is changing its efforts for pro customers. Lowe’s estimated its Q2 pro appreciation event garnered over 35,000 new pro accounts, which could represent nearly $100 million in future revenue.
“Our commitment to retail fundamentals and continued focus drove significant improvement in the Pro customer service scores and Pro comps which significantly outperformed DIY comps,” McFarland said on the earnings call.
For its first strategic pro initiative, Lowe’s rolled out a pro loyalty program in three test markets during the quarter. Early results from the test markets have “exceeded expectations,” McFarland said, and the home-improvement retailer plans to roll out the loyalty program nationally in the first half of 2020. The program will be integrated with the company’s CRM program, allowing it to deploy “more surgical, strategic marketing” to pro customers, according to McFarland.
Lowe’s also plans improve the in-store pro experience in the fourth quarter by rolling out dedicated point of sale terminals at its Pro Desks to allow more convenient and faster service for pro customers. The retailer may also test initiatives such as tool rental programs in future quarters.
