Remodeled True Value store woos the women
The new True Value hardware store, tucked into an Illinois strip mall surrounded by 1960s split-level homes, is one of a kind.
The outpost is the Chicago-based hardware cooperative’s first corporate-owned store, a chance for company executives to understand what its thousands of independent store owners experience every day. The corporate site represents True Value’s latest thinking about what constitutes a hardware store. It’s more than a place for men to knock around on a Saturday. It has to appeal to women too, sometimes the key decision-makers when it comes to home improvement.
Wooing women to the hardware store is nothing new. Lowe’s Cos. led the way a decade ago with stores that were cleaner and more organized than rival home-improvement stores. Home Depot Inc. followed suit with a homier Home Depot, focusing on home decorating, hosting do-it-yourself workshops for women and, this year, adding Martha Stewart Living paints, closet organization kits and cleaning supplies.
But the recession put a crimp in the $267-billion home-improvement industry’s push to market to women, an effort that had been going gangbusters during the housing boom. As consumer spending rebounds and the pace of kitchen and bathroom remodels picks up, women are going to be driving the purchases, said Marti Barletta, president of TrendSight Group, a Winnetka, Ill.-based research group, and author of “Marketing to Women.”
“Women are the majority of home-improvement shoppers and make the majority of home-improvement decisions,” Barletta said. “Men tend to repair this and that. Women tend to take on the projects that involve ‘let’s redo the bathroom’ or ‘let’s redo the cabinets.’ ”
A walk through the True Value store this week found plenty of changes seeking to appeal to women. Instead of a hodgepodge of hammers and screws crammed onto shelves, color-coded signs made it easy to navigate the store: blue for plumbing, green for garden, red for hardware. The store touts wider aisles, brighter overhead lights, an expanded assortment of decorative door knobs and drawer pulls and a can’t-miss paint store as soon as you walk in the door.
“This is a lab for us,” said Lyle Heidemann, the Sears hardware and appliance chief who took over as True Value’s chief executive in 2005. “It’s about ‘How can we help our retailers become more efficient?’ ”
The 12,300-square-foot store is bigger than the typical 8,500-square-foot True Value store and roomy enough to better compete with giants Home Depot and Lowe’s.
True Value picked Mount Prospect because there is a Home Depot, a Lowe’s and two Ace Hardware stores nearby, as well as scores of post-World War II houses in need of repair, Heidemann said as he toured the store. He was wearing a workman-like blue collared shirt embroidered with the red True Value logo and had a pen in his pocket as if he were ready to write down the dimensions of a pipe or drill bit.
The idea is for headquarters workers, whose job it is to sell wholesale merchandise to the stores, to get a feel for what it’s like to be in the trenches, Heidemann said. Although the corporate employees don’t work the store, they decide how it operates and are responsible for its sales and profits, a far cry from making decisions with a PowerPoint presentation in a conference room.
The initial tests have shown promise. Since the format was unveiled at the annual dealer show in Atlanta in October 2007, 105 of True Value’s 3,500 stores have converted. True Value expects the number of new-format stores to grow to 175 by the end of this year. Since the stores are independently owned, it’s difficult to forecast how long it will take to transform the chain nationwide, Heidemann said. And there are hundreds of stores that will probably never be remodeled.
The remodeled stores have posted an average 10% increase in revenue, Heidemann said.
It hasn’t been easy running a hardware store these last few years. Home-improvement stores were the first retailers to feel the pain of the housing slump and among the last to find relief.
In May, hardware merchants around the nation let out a collective sigh of relief when big-box chains Home Depot and Lowe’s each reported their first quarterly gain in comparable-store sales in four years.
The Home Improvement Research Institute forecasts 2010 industry sales will rise 1.7%, to $271.8 billion, after falling an estimated 8.3%, to $267.3 billion, in 2009.
True Value posted a 1.9% earnings increase in 2009, to $65.4 million, on a 9.4% decrease in revenue, to $1.8 billion. Sales at stores open at least one year, a key retail metric, fell 5.4%.
With the home-improvement industry in flux, True Value has a chance to gain market share by attracting more women to its stores, said Gary DiCamillo, a consultant at Kurt Salmon Associates. “It will help them grow and compete against the big boxes.”