Home Depot Putting Its Big Orange Stamp Online

Home-improvement buffs and Bob Villa-types everywhere salivate at the thought of spending a Saturday cruising the cavernous aisles of Home Depot. Now the $38 billion building-supplies giant is hoping to create that kind of enthusiasm on the Web. The company is testing new commerce features on its Web site that let customers find and order products from local outlets. The test is available only in the Las Vegas area and initially open only to professional builders.

Home Depot is arriving late to the business-to-consumer Internet party. (Home Depot's current Web site only offers information and do-it-yourself tips.) What took it so long? Execs say they didn't want to rush. With the pilot, they want to offer online shopping that's closely tied into smell-the-sawdust shopping. The Web store, built on software from BroadVision Inc., is integrated with Home Depot's homegrown merchandising, fulfillment, and labor- scheduling systems. This integration lets online customers enter their ZIP codes to see what's available in their areas, schedule pick-up times at their local stores, or book deliveries.

The service is aimed at pros, who are about 25% of Home Depot's customers. It can cost an average of $50 to ship large items such as planks and windows. Consumers might balk at that, but not all pros. Ron Griffin, Home Depot's CIO, says he expects the Internet to be just another channel for those customers, albeit one that will probably mandate expansion of its distribution infrastructure.

Griffin insists the Web store isn't meant to generate sales. It's about offering new tools to customers and increasing overall sales by making it easier to work with the company. Home Depot may be late, but it's in the sweet spot of another trend--brick-and- mortars integrating Web channels with existing channels. Gartner Group analyst Jeff Roster says "it will become very challenging for pure-play Internet companies to compete against" such companies.

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