The Home Depot Inc.’s omnichannel efforts are paying off. 42% of Home Depot’s online orders are fulfilled by its stores and 90% of e-commerce orders are returned to stores, said Ted Decker, executive vice president for merchandising, this week during a conference call with analysts.
Moreover, Home Depot expects the number of online orders that are fulfilled by stores to rise as the home improvement retailer rolls out its “buy online, deliver from store” system, CEO Craig Menear said this week during Home Depot’s fiscal second quarter earnings call with analysts. The system allows customers to buy something online and schedule delivery from a local store, similar to how they would set up delivery for an in-store purchase.
“We’ve always delivered from our stores. The difference now is you can execute the transaction online and pick a much shorter delivery window for your delivery,” he told analysts on the call, according to a Seeking Alpha transcript. “We are in about 700-plus stores now with buy online deliver from store. We will be finished with that rollout by the end of this year.” Home Depot has 2,275 stores in the U.S., Canada and Mexico.
Home Depot, No. 7 in the Internet Retailer 2016 Top 500 Guide, has also begun estimating when online orders’ delivery dates based on the customer’s location, which the retailer calls “dynamic ETA,” Menear said on the call. When a customer adds items to the online cart that can be delivered from the store, the website asks for a ZIP code. Once the ZIP code is entered, the customer is given the earliest-available delivery date prior to finalizing the transaction.
“In the past, we issued a generic delivery window estimate, which allowed for extra time or cushion for the delivery commitment to customers,” he said. “As we’ve begun to implement the dynamic ETA, our promised delivery date to customers is earlier and more accurately estimated.”
Home Depot says web sales for the fiscal second quarter ended July 31 increased 19% to almost $1.5 billion. That follows a first quarter in which web sales increased 21.5%.
Online sales in the second quarter accounted for 5.6% of its $26.472 billion in sales.
Mobile devices account for more than 50% of Home Depot’s online traffic, Decker said. The company is enhancing its online functionality in mobile with features like larger, clearer product images, live mobile chat and a simplified checkout experience, he said.
For the quarter ended July 31, Home Depot also reported:
- Sales of $26.472 billion, up 6.6% from $24.829 billion in the year-ago quarter.
- Comparable store sales increased 5.4% in the U.S. and 4.7% globally.
- Net earnings of $2.441 billion, up 9.3% from $2.234 billion.
For the six months ended July 31, it reported:
- Sales of $49.234 billion, up 7.7% from $45.720 billion a year ago.
- Net earnings of $4.244 billion, up 11.3% from $3.813 billion.