As makeovers go, it’s not especially extreme, but retailer Home Depot is aggressively using direct channels to bring its décor-oriented offerings to consumers. Or, as Shelley Nandkeolyar, president of HD Direct Brands (Home Depot’s direct marketing arm) puts it, the company is moving from foundation to furnishings. The chain, which is more commonly known for its do-it-yourself projects than for accoutrements, has experienced numerous false steps since it launched its first catalog in 2003. An early “Slim Jim” format, along with a standard-size catalog, were both seen as freestanding insert and traffic building vehicles as opposed to direct mail order vehicles. The biggest problem was the merchandise mix, Nankeolyar said. With 2000 stores in North America, a large segment of its existing customer base has an outlet within driving distance, and doesn’t need to deal with the delays of mail order. The retailer quickly shifted the mission of its mailing pieces to “extending the aisle,” or featuring merchandise downplayed in its stores. Within the last two years, it has launched 10 Crescent Lane and Paces Trading Co., two catalogs that play up the softer side of Home Depot. Rather than feature hammers and roofing compound, these new brands feature outdoor lighting, patio furniture, and home decorations. As a result, Home Depot’s catalogs, which had given over more than half of their pages to merchandise found in store, now largely promote items unique to its direct response business. As a result, Home Depot has greatly expanded its reach among several traditionally underrepresented consumer segments. The catalogs reach more affluent consumers, and are primarily targeted to women. The company has also found that known direct response or catalog shoppers (especially for brands such as Willams-Sonoma, Ethan Allen and Crate and Barrel) are especially responsive prospects – and this is a demographic not often found within its stores. The company has endeavored to carry the brand promise of 10 Crescent Lane throughout all contact points. Orders are shipped in a box-within-a-box package, and the order detail form has been incorporated into an elegant thank-you note. Call center operators are required to announce that “It’s a great day at 10 Crescent Lane today” before helping customers. As for the name itself, “We wanted an ‘anyplace, America’ name,” Nandkeolyar said, one that encapsulated “upscaleness and gentrification.” One prospect apparently agreed. Nandkeolyar once received a call from someone who asked, “I live on 10 Crescent Lane. Would you like to redo our kitchen for us?” Without any cost to the customer, of course. “I said ‘hmm,’ and left it at that,” Nandkeolyar said. Nandkeolyar discussed Home Depot’s catalog activities during a keynote address at the National Center for Database Marketing conference in Orlando.
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