Home Depot vs. Amazon: Who is Winning The Home Improvement Market?

Considering the global boom in e-commerce led by Amazon, it is easy to assume that traditional brick-and-mortar retailers such as Home Depot would be lagging behind. However, a closer look at Home Depot would reveal how this home improvement giant is outperforming the pure e-commerce players in its category, including Amazon.

Physical Buying Experience Matters in Home Improvement

The very nature of the home improvement product category sets it apart from most others. Home Depot, the industry leader in this category, carries more than half a million items (and counting).

The company sells, for instance, more than 7,000 different types of screws! So, what may appear to be a seemingly simple product can be mind-bogglingly complex, and you cannot do an impulse buying for most such products.

The average customer, ranging from an occasional consumer to the most knowledgeable DIY enthusiast, often prefers in-store buying experience at Home Depot because of the countless choices and combinations available. Shopping in the store allows the customer to see and feel the tangible products, and can ask questions or clarifications from the sales personnel at the store.

Home Depot’s BOPIS Advantage is Unmatched

Home Depot has taken the customer buying experience to the next level by creating the hybrid “Buy Online, Pickup In-Store” (BOPIS) model. Home improvement customers are often in urgent need of products if they have a repair or renovation going on, which cannot be put on hold for long.

Online delivery through Amazon can take time, particularly when the product is bulky or difficult to pack or ship. Moreover, it can be a nightmare if it turns out to be the wrong product choice once the delivery is received. Therefore, many customers prefer buying from the Home Depot website, and pick it up personally from the store so that they can see and check the product tangibly, and ask questions related to assembly or usage.

No wonder that nearly one-fourth of Home Depot’s annual website sales now take place via the BOPIS program. Clearly, Home Depot has turned its nearly 2,000 physical stores around the country into its strength, rather than a liability. It is continuing to improve the leverage from these stores to address most of the hurdles customers face when buying DIY products online via Amazon or other e-commerce sites.

Easy Delivery, Easy Returns with Home Depot

For hardcore e-commerce shoppers who hate visiting a physical store, a growing number of Home Depot locations are now able to deliver online orders within two to four hours, even for bulky items such as building materials or lumber.

Home Depot is using its stores to serve the dual purposes of warehousing for online orders and as points of collection and return of these orders. As a result as many as 43 percent of its online orders get collected in-store and more than 90 percent are returned in store. This is the kind of omni-channel sales approach that pure e-commerce players such as Amazon are unable to adopt.

On top of it, Home Depot’s easy return policy allows customers to return most new and unopened merchandise within 90 days of purchase. 

Utilize E-commerce and Brick & Mortar

Home Depot’s leveraging of its physical store network and integrating it with online sales has ensured a seamless customer experience that is giving the customers the best of both the worlds. Home Depot has demonstrated how physical retailers can still combat the enormous e-commerce competencies of Amazon in order to preserve their market share and brand leadership.