Spring is finally here and people everywhere are bursting to get outside. During a year of being confined at home, people spent more time and upwards of $84 billion on home improvements and repairs alone in 2020, according to a study by home insurance group Hippo.
Top on their list of improvements was the outdoors, followed by the kitchen, home office and home gym, in the survey among 1,000 American homeowners survey. It found some two-thirds (66%) spent more than $1,000 on upgrading and repairing their homes and even more (71%) said they plan to continue the same accelerated pace in home improvements this year.
And like last year, the outdoor living areas will continue to get more attention, most especially because the latest round of government stimulus checks will coincide with the home improvement spring selling season.
Looking at the stimulus’ impact for the second quarter 2021 across many categories of consumer spending, Bloomberg Intelligence singled out home improvement, particularly outdoor projects, for increased emphasis this year. That will especially benefit Home Depot
“The spring selling season is one of the most important sales drivers for Home Depot and Lowe’s,” says Drew Reading, Bloomberg Intelligence’s senior U.S. home building and improvement analyst.
This year the home improvement giants will get an extra bounce since they were forced to limit last year’s spring 2020 activity in an effort to moderate in-store traffic. But as more people get vaccinated, Home Depot and Lowe’s are throwing open their doors and making ready for an even bigger spring selling season in their lawn, garden and outdoor living departments.
And it won’t be just the DIYers that will be shopping for outdoor improvements, but Reading predicts strong growth from home professionals too.
“With home sales over the last six months at their highest level, which is a huge driver of home improvement spending, we see pent-up demand for bigger ticket projects, ones that require a contractor,” Reading explains. “So from that perspective, we expect bigger ticket purchases to outperform for these companies over the course of the year.”
Overall the consumer market for outdoor living products, including garden equipment, plants, furniture, hardscapes and the rest totaled $32.8 billion in 2020, a 12% increase over $29.3 billion spent in 2019, according to Freedonia Group. This far exceeded Freedonia’s pre-2020 estimate of a modest 3.3% increase.
And it may well keep that heady pace of double-digit growth, if consumers undertake even more ambitious outdoor projects this year, as Reading expects.
“Given how ‘antsy’ people are to get outside and how strong home has been, tackling outside projects is a quick-win, big-impact change to make. Combine that with the timing of the stimulus checks, and everything plays right into the hands of Home Depot and Lowe’s,” Reading says.
Home Depot’s spring starts online
Having learned last year that its consumers’ path to purchase typically starts online, Home Depot is leveraging its digital presence to inspire customers to think bigger about improving their outdoor spaces.
“It is our opinion that retailers that create a seamless, interconnected experience, blending the physical and digital worlds, will be positioned well in the marketplace,” CEO Craig Menear wrote in the latest annual report.
While the company added $21.9 billion in sales to reach $132.1 billion in 2020, an increase of 19.7% compared to fiscal 2019, its indoor and outdoor garden departments combined blew the roof off in terms of growth, rising nearly 30% year-over-year.
Indoor garden alone was the company’s biggest moneymaker, $14.3 billion or 10.8% of sales, as compared to the next highest category appliances with 9% of sales. Outdoor garden wasn’t far behind, $9.6 billion or 7.3% of sales.
Home Depot’s Sarah Fishburne, director of trend and design, credits its customers leaning into more ambitious projects as a key driver of growth for the company, especially outdoors where a little bit of sweat equity can pay off big.
“With the pandemic, more people are doing projects they hadn’t necessarily been comfortable or willing to do before, but now they’ve had time to watch videos and do their research so they’ve stepped up to building a fire pit, stringing up lights or adding pavers,” she shares.
Encouraged by an 89% increase in sales through its digital platforms last year, Home Depot has built up its digital resources to draw customers to its roughly 2,000 store locations.
This is where the Spring Outdoor Living Ideas section of its website comes into play. Filled with over 1,000 ideas, it includes:
- Buying guides explaining how to select the right products for the customer’s need;
- Inspiration guides to get the big picture of what can be done to improve outdoor spaces;
- Influencer guides created by designers giving inspiration for transforming outdoor spaces; and
- Project DIY guides that show the how-tos for a range of projects with a score for project difficulty and how much time to allow for completion.
As for trends, Fishburne anticipates strong demand for seating this year, from extra chairs to use in the front yard to expansive sofas for lounging on the patio and high-top tables and chairs for outdoor dining.
People will also be looking for products that help extend the time they can spend outdoors, including ambient lighting to carry over into night, umbrellas and patio coverings for shade and weather protection, netting against bugs and fire pits and heating elements to extend the season.
More potted plants and greenery will also be on the agenda, as will a demand for more decorative accessory items, like pillows, to add the finishing touch.
The sky is literally the limit when it comes to decorating outdoors.
“The indoors is influencing the outdoors and the outdoors is influencing the indoors more,” Fishburne says. “People have become tired of being inside their four walls and want to take it outside. They are now looking at their outdoor space and decorating as they would their dining room or living room.”
Lowe’s is imagining all the possibilities
With some 1,700 U.S. locations, Lowe’s is about two-thirds the size of Home Depot in sales volume, yet it exceeded its prime competitor’s growth last year, rising 26.1% to $89.6 billion in sales.
And while it doesn’t report segment sales, its competitor’s results are a fitting proxy for Lowe’s, as the company’s EVP of merchandising Bill Boltz said Lowe’s outdoor living and lawn and garden categories delivered over 30% comparable growth in the fourth quarter 2020 earning call.
To keep the good times rolling, Lowe’s has extended its usual spring weekend kickoff into a monthlong celebration called SpringFest. Each Thursday through the month of April, customers can register for free curbside pickup of family-friendly outdoor activity kits, like a Garden-to-Go kit sponsored by Miracle-Gro
Introducing the concept behind its SpringFest during a virtual press conference, Marisa Thalberg, EVP chief brand and marketing officer, explained it as the “idea of wanting [Lowe’s] to continue to be home to any possibility. It’s an ethos for us now in addition to an advertising line.”
To that end, Lowe’s is adding the unexpected to the usual suspects found in home improvement retailers, like tableware and a wide range of decorative accessories, along with trampolines, tents, binoculars and telescopes for backyard adventures.
In the press conference, Boltz described the spring season as the retailer’s Christmas season and its research pointed to strong results ahead. Nearly 90% of homeowners who completed home products during the Covid year are planning to do more this spring. And some 70% of those surveyed have no plans to travel this spring, meaning they will have plenty of time to undertake new home projects.
“With the change in season comes a change in mindset and what we want to be is inspirational,” Thalberg added. “We want our role to unlock the potential to help our customers create destination-worthy experiences at home and thinking about home as the ultimate destination, whether it is a sanctuary or a place for fun and escape. It’s all possible.”
As the saying goes, “The early bird gets the worm,” and an Easter-weekend stroll through the outdoor living departments of my local Home Depot and Lowe’s stores in southeastern Pennsylvania found Lowe’s the early bird.
It wasn’t like Home Depot wasn’t ready, but Lowe’s was readier. For example, Home Depot’s outdoor gardening displays were sparse, but it is early in the season for in my region. That said, Lowe’s garden area was filled with trees, perennials and early-season annuals suitable for planting now.
Inside the store, both had plenty of outdoor living tools and hardware on display, but Lowe’s had a larger selection of patio furniture, accented with more colorful displays of outdoor living decorative accessories, like umbrellas and rugs. On a multi-sensory note, Lowe’s Easter flower displays were especially fragrant, even through my mask.
Based upon this sample of one, I found Home Depot pretty much as expected, but Lowe’s truly inspirational, but then I’m not the kind of shopper whose heart beats faster for a souped-up garden tractor or fancy gas barbeque grill.
While both Home Depot’s Fishburne and Lowe’s Thalberg explain that its customers are pretty evenly split gender-wise, it is clear that Lowe’s is exploring the possibilities for its female customers more, as evidenced by its surprising sponsorship of New York Fashion Week last fall.
“We want to empower all of our customers no matter their gender, from the lightest DIY customer or someone who wants us to do it for them to our most experienced pros,” Thalberg shared in a follow-up phone call.
“But the breadth and selection we offer now in our stores and online and the experiences we are creating is really distinctive. When we did New York Fashion Week, it opened people’s minds to the amount of incredible decor and home furnishings we offer. For our customers, no matter their level of DIY competency to the pro-end of the store, we are creating a better experience for them all,” she concluded.