Home Depot's (NYSE:HD) sales grew 36 percent last year, by more than $1 billion. The reason: Consumer confidence is up and people are more willing to invest money in their homes. Of those sales, 4.5 percent were completed online. The company plans to keep growing its online division through faster delivery times and better inventory distribution.
Home Depot has capitalized on the upward trend in its sales growth by launching a new line of KitchenAid appliances in the second quarter and expanding its assortment throughout the year, reported TheStreet.
In comparison, Lowe's saw about $1.4 billion in online sales in 2014, $1 billion less than Home Depot.
Home Depot's online sales grew 40 percent in the first quarter and 32 percent in the fourth.
At the helm of this growth is Kevin Hofmann, head of Home Depot's online business. His team is using big data to grasp customer clicking and buying tendencies, with the intention of improving the company's search capabilities.
"We still have so much we have to light up from a fulfillment capacity, while there is an endless sea of refinements to make the customer experience better," Hofmann told TheStreet.
In order to continue online growth, Hofmann noted that the company will need to address two problems: speeding up delivery times and reducing "out of stock" messages. To combat these problems, Home Depot recently opened two new distribution centers dedicated to online orders, with plans to open a third in Ohio this year. Once all are operating, the company will be able to deliver in two days or less to 90 percent of the country.
Home Depot hopes to alleviate some of its issues by using store inventory for delivery. Though the program recently piloted, the hope is that many more customer orders will reach completion without troublesome absences in inventory.
Despite all of the success the Home Depot is having online, it's still trying to replicate that momentum in brick-and-mortar stores. Last week the company announced the testing of 85-inch interactive Samsung kiosks in the appliance department, intended to provide helpful shopper information.
-See this TheStreet article
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