Challenges Faced by Lowe and Team

Challenges faced by Lowe and Team

• NGIS was more complex model than traditional retail sales

Involved developing relationships with local contractors, builders and customers.

• Communication challenge: end to end service offering required digital media to educate customers about Lowe’s solution and convincing them of its value

• Choice of digital media, allocation and most effective phase of implementation

• Customer Engagement: information regarding how to gain and hold customer awareness and generate sales leads during the during the long incubation period

• Insights into customer decision process regarding kitchen remodelling project

• Info and messages sought by the consumers

• Perception issues: survey results suggested only 8% customers preferred Lowe, Home Depot had higher preference (31%) and lesser prices in a price-sensitive market.

Understanding the Market and Competition

Market overview

$17 Billion kitchen renovation industry is experiencing a slowdown after 2008 recession. 75 percent of kitchen remodelling projects were carried out by professionals while 25 percent done by the homeowners themselves.

Home renovation industry was highly fragmented. Traditionally the remodelling services were provided by small companies and independent contractors with strong ties with the communities, which was changing as more and more big box retailers began offering mix of product and installation service.

Competitors and their offerings

Home Depot

Largest home improvement retailer offered a program that offered free design services and measurement services. In addition, the installation was done by licensed professionals and also offered financing options.

Sears

Primarily focused on appliance sales and support in kitchen remodelling, this retailer offered free in-home design consultation as well as installation services.

IKEA

Held a significant share in kitchen remodelling market, offered free design service with purchase of installation, easy to use web tool to design own kitchen in 3D with price quote and any other required assistance.

Studio 41

Catered to niche high end market in Chicago and for a retained fee offered design consultation and had price match guarantee.

Lowe’s response to competition

Feeling the competitive pressure Lowe’s decided to modify it’s NGIS program, not limiting it to only installation but services from initiation till post completion, being the one stop solution for kitchen remodelling. It planned to offer design consultation, web tools for online kitchen design and installation services to mid-range kitchen remodelling projects

Customer Mapping and its importance

Customer mapping is a technique used to understand the stages a customer goes through – before, during and after interacting with the product/service in question. It involves breaking down the entire pre-during-post journey of the consumer into smaller parts, finding touchpoints with the customers, and understanding their psyche. The process also helps visualise the journey, which helps marketers picture the process and work accordingly.

The entire customer mapping process helps observe and understand customers in different settings (in-home, on-location,etc.) in different