Investment in omnichannel strategies has helped the home improvement retailer grow online sales at a fast pace. Home Depot is No. 7 in the newly released 2017 edition of the Internet Retailer Top 1000, up from No. 46 in the 2013 edition.

Collectively, retail chains experienced stalled growth in online sales with the slowest year-over-year bump since the heart of the recession in 2009, but some innovative players managed to buck the trend.

The Home Depot Inc., No. 7 in the newly released 2017 edition of the Internet Retailer Top 1000, is one of those retailers as it continues to invest in omnichannel capabilities and see positive results.

In 2016, the home improvement giant experienced a 19.6% year-over-year increase in its e-commerce business, compared with a more modest 10.8% uptick on the web for retail chains as a whole. The nine retail chains in the hardware/home improvement category that made it into this year’s Internet Retailer Top 1000 rankings grew web sales 12.6% on average. So Home Depot must be doing something right to outperform competitors.

Digital priorities are topping the to-do list for most chains, even as they are reducing their store footprint to cut costs. Home Depot is among a few key bricks-and-mortar retailers that are reaping the benefits of hefty investments in their online businesses and strategies that more closely link their stores with the web, even though online sales represent a small portion of their total business.

The merchant gets the vast majority of revenue from its more than 2,200 physical stores in the U.S. Still, online sales for Home Depot have more than tripled in five years, and it’s now among the top 10 largest online retailers in North America. In 2013, it was ranked No. 46 in the Top 1000.


In addition to increasing online purchases, the robust nature of Home Depot’s web and mobile properties are driving consumers into its stores, as it reports about 45% of online orders are picked up in stores. That’s critical because once consumers are in stores, they are likely to spend more, experts say. Retailers and analysts say these types of strategies are crucial if bricks-and-mortar retailers are going to compete effectively with Inc., No. 1 in the Top 1000 by a wide margin.

“There is this whole movement toward omnichannel that was framed to stores as the way to thrive,” says Keith Anderson, senior vice president of strategy and insight at e-commerce technology company Profitero. “And I think if you look at the scoreboard, it would have been better sold to the bricks-and-mortar industry as the only way to survive.”

In addition to offering convenient in-store pickup of online orders, Home Depot, in its fiscal fourth quarter, finished the rollout of what it calls Buy Online Deliver From Store (BODFS) capabilities. The program lets the merchant fulfill online orders by pulling from physical store inventory, which helps speed delivery to online shoppers because stores often are closer to consumers than Home Depot’s e-commerce fulfillment centers.

“BODFS was built on a foundation of our new customer order management system, which was fully deployed in all U.S. stores during the second quarter of 2016,” CEO Craig Menear told analysts on a conference call in March 2017. “We are pleased with a positive customer response to this enhanced delivery option, which streamlines the delivery experience for both our customers and our store associates.”


Plenty of other chains are going a similar route, as 50 Top 1000 merchants are fulfilling online orders with store inventory, up from 40 merchants last year.

The 2017 edition of the Top 1000 is available as a PDF report or in an online database format. The report provides a comprehensive look at the trends and key players shaping the U.S. e-commerce industry, as well as a deep dive into who the leaders are and what they’re doing to stay ahead of the competition—or, in many cases, to survive.

The online database membership—depending on the subscription level—gives the list of companies and a host of exclusive data, including financial and operational data, key e-commerce executive names and a list of technology vendors each merchant uses to run its online retail business.