HOME DEPOT CAMPAIGNMARIAH ABELL IMC 610

Integrated Marketing Communication Campaign for Home Depot

10/20/2014

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TABLE OF CONTENTS

Executive Summary 2

Background Information 3-6

Target Analysis 7-8

SWOT Analysis 9-10

Campaign Objectives and Strategies 11

Integrated Strategy Statement, Creative Brief, and Creative Execution 12-15

Media Objectives and Strategies 16-18

Public Relations Plan with Objectives, Strategies, and Tactics 19-20

Direct Marketing Plan with Objectives and Tactics 21

Sales Promotion Plan with Objectives and Tactics 22

Measurement and Evaluation Plan 23

Conclusion 24

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EXECUTIVE SUMMARY

In this paper is an Integrated Marketing Communications Plan for Home Depot. The target audience is female shoppers between the ages of 30 to 50 is the focus of the proposed campaign and an abundance of research has been completed to identify and utilize Home Depot’s strengths, weaknesses, opportunities, and threats to prepare a plan that is most beneficial to the company. Objectives and tactics have been designed to with Home Depot’s values. This detailed plan includes marketing, creative, media, and public relations strategies, as well as direct marketing and sales promotion tactics. A comprehensive budget and media plan flowchart will map out the campaign and the proposed measurement and evaluation plan will assess the campaign upon completion

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BACKGROUND INFORMATION

History of Home Depot

Home Depot was founded in 1978 by Bernie Marcus and Arthur Blank. Along with investment banker Ken Langone and merchandiser guru Pat Farrah, the founders’ vision of one stop shopping for the do-it-yourselfer (DIY) came to fruition when the first two stores opened on June 22, 1989 in Atlanta, Georgia (Our History 2013). From the start, Home Depot’s goal is to help consumers create the home of their dreams whether they want to do it for themselves or have it done for them. To this day, Home Depot’s corporate headquarters are still based in Atlanta, Georgia. Home Depot revolutionized the home improvement industry by bringing the know-how and the tools to the customer. Today it is the largest home improvement retailer in the United States.

Mission Statement

According to Bernie and Arthur, the customer has a bill of rights at Home Depot which entitles the customer to the right assortment, quantities, and price. The philosophy of customer service is “whatever it takes,” which means cultivating a relationship with customers rather than completing a transaction (Our History 2013).

Home Depot Values

Home Depot has eight core values that guide the beliefs and actions on a daily basis. They are the fabric of Home Depot’s unique culture and central to their success (Our Values 2013).

1. Taking care of our people2. Giving back to our communities3. Doing the right thing4. Excellent customer service5. Creating shareholder value6. Building strong relationships7. Entrepreneurial spirit8. Respect for all people

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Financial/Investment

According to Home Depot’s 2013 Annual Report, Home Depot’s revenue is currently $78.812 billion up from $74.574 billion from 2013. They have an operating income of $9.166 billion, up from $7.766 billion last year. Their net income is $5.385 billion and their assets are $40.518 billion, up from $4.535 and down from $41.084 billion respectively.

Product, Services and Pricing

Home Depot has over 2200 locations throughout the United States, Canada, China, and Mexico. Stores average 105,000 square feet with an additional 23,000 square feet in the garden area. Store inventory consists of up to 40,000 different kinds of building materials, home improvement supplies, appliances, and lawn and garden products. Home Depot offers a low price guarantee to beat any competitor’s advertised specials.

Home Depot offers customers the choice of using qualified professional complete their home renovation projects. They offer national installation services through pre-screened independent contractors for products ranging from floors to roofs. Professional customers have access to loyalty programs, volume discounts, direct ship programs, credit programs, and other specialty sales initiatives.

Home Depot offers weekend workshops to any amateur DIY-er. They have special workshop for women and children (Stores, Products, and Services 2013).

Milestones

Some of Home Depot’s largest milestones include:

1978: Founded by Bernie Marcus and Arthur Blank

1979: First two stores open in Atlanta, Georgia

1981: IPO on NASDAQ

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1984: IPO on NYSE

1989: Opened their 100th store

1994: First store in Canada

2001: First store in Mexico

2006: First store in China

Leadership

CEO: Frank Blake (Craig Menear effective November 1) (Saporta, M. 2014).

Executive VP & CFO: Carol Tome

Executive VP & CIO: Matt Carey

Executive VP-US Stores: Marvin Ellison

Marketing Communication Strategies

Home Depot uses a multitude of channels to get their message across. They use the majority of their advertising on print and television. Nearly every week, Home Depot releases a new ad in newspapers across the country. They highlight the many products offered. The front page of the ad usually advertises some type of appliance such as a refrigerator or a washer/dryer combo. As you dig into the rest of the ad, you will find sales for products in each part of the home.

Home Depot’s current slogan is “More Saving. More Doing.” Their current Twitter hashtag is “Lets Do This” which tells us to get up off of the couch and tackle that home improvement project we have been putting off.

Home Depot is on Facebook, Twitter, You Tube, and Pinterest. As you search their channels, you will find a variety of DIY videos, special offers, and instructions for putting things together. Pinterest is exclusively catered to the female demographic. You will find seasonal craft ideas, and any idea for any room of the house. All stores have weekend DIY clinics on the third Saturday of the month. They have special workshops for women and children.

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Competitors

Lowe’s-founded in 1946 by Carl Buchan who purchased the company from his brother-in-law and had the foresight to anticipate a post-WWII housing boom. He envisioned creating a chain of hardware stores that eliminated wholesalers and dealt directly with manufacturers. They are headquarted in Mooresville, North Carolina.

Lowe’s has established a reputation for low prices. They exist to help customers improve and maintain their largest asset-their home. In more of their 1,830 stores, Lowe’s has implemented multiple systems to improve the customer experience which includes an upgraded store information technology infrastructure that allows customers and employees to access richer product information.

Lowe’s now has enlarged, cleaned, and brightened their aisles to make for a more pleasant shopping experience, which is what the female demographic is looking for.

Lowe’s revenue was $53.4 billion in 2013. (About Us 2014).

Menard’s-family-owned company founded in 1960 and has more than 280 stores located in 14 states. They are headquartered in Eau De Clare, Wisconsin. Menards began as a pole-building company until the mid-1990s when they expanded into home improvement retail. Menards is now retail home center leader in the Midwest and the third largest home improvement retailer behind Home Depot and Lowes. According to their website, Menards is known throughout the home improvement industry as the low price leader (Menards 2014). Their slogan is “Save Big Money at Menards!” They use a “bigger is better” approach with the average store size being around 130,000 square feet. Menards has the distinction of biggest home improvement retail store in the world. It is located in Owensboro, KY with a size of 246,000 square feet (Mattingly 2012).

Menard’s is committed to providing high-quality guest services whether it is through helping guest design and/or calculate projects with their Design-It Center or answering questions about merchandise (About Us 2014). In 2013, Menards made around $7.9 billion in revenue.

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TARGET AUDIENCE

Target Analysis

I will be targeting female DIY-ers between the ages of 30-50. They will have a middle-class income, live in a suburban area and are existing home owners who want to update their home with the potential to sell said home in the near future.

Demographic Characteristics

The women are between the ages of 30-50. They live in the suburbs and are home owners who want to update their home for potential re-sale.

Psychographic Characteristics

These women make the home improvement decisions in their household. If they can, they will go ahead and fix the problem themselves. They are willing to learn and are not afraid of getting their hands dirty. They research for the best deal they can find on a product and are not loyal to any store, just whoever has the best deal.

A Day in the Life

She walks into the home improvement store with her cell phone to take pictures and her notepad to take notes and compare prices. She is ready to sell her first home, but the home needs some updates before it is ready to sell. She is mainly looking to replace the floor, spruce up the landscaping, and change out the lighting. She decides to start in the garden section of the store. As she looks around, she notices the store’s “Simple Steps” located above certain products. For example, how you can have a thicker and healthier lawn. They show pictures of a fed and unfed lawn plus time on how to select the right color for the different seasons. She looks at the different plants in the garden are, but planting will be her husband’s job because of her allergies. She can’t go into a florist without sneezing! She looks at the different tiles for the patio. Hmm, she thinks, you know the patio could use a facelift. She takes a photo of the tiles.

After looking around the garden area, she heads to the lighting. An employee comes up to her and asks if she needs any help. She thinks about it for a second and explains to the employee that she wants to change out the bathroom lighting and update the chandelier in the dining room. She also explains that she doesn’t want to spend too much money because she and her husband plan to sell the home in the near future. The employee guides her through the process. She takes photos of the lighting and chandelier she likes. Next she heads to the flooring department to look at laminate flooring. She decided to go for hardwood because of the price. The flooring expert comes by and asks if she needs any help. She says she does and then notices that the store does a free consultation on installing

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flooring. She asks the employee to help her find a laminate floor with a 12” thickness and one that looks like engineered hardwood. He shows her several options and gives her samples to take home and lay down on her floor so she can choose the right flooring for her. She also asks about the free consultation and lets the employee know that she will be given them a call soon. She browsed around a little longer and then left the store with a lot to think about.

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SWOT ANALYSIS

SWOT Analysis-a structured planning method used to evaluate the strengths, weaknesses, opportunities, and threats involved in a project or in a business venture.

Internal Factors-Strengths and Weaknesses

External Factors-Opportunities and Threats

Home Depot’s strengths include being the largest home improvement retailer in the world. Home Depot is one the world’s most admired companies, according to Fortune Magazine. Home Depot has rediscovered its core values under the leadership of Frank Blake.

Home Depot’s weaknesses include the constant product recalls. Home Depot also has a problem with targeting their market towards women even though they are attempting to correct this issue (e.g. their Pinterest channel).

Home Depot’s opportunities include the continuation of the housing recovery. Customers are updating their homes to prepare for a future sale. Home Depot has increased their digital advertising and has customized their online shopping experience. They are beginning to target the female demographic with DIY clinics and female-based products.

Home Depot’s threats now include the possibility of the housing market trending downward. The housing market continues to remain unsteady. Lowe’s has gained headway into the female

Strengths

Largest home improvement retailer in the world

One of the most admired companies

Rediscovery of core values

Weaknesses

Product Recalls Target marketing and

advertising towards female demographic

Opportunities

Housing Recovery Online Shopping Targeting the female

demographic

Threats

The high possibility of the housing market trending downward

Competition from Lowe’s

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demographic by making their stores cleaner and brighter and adding designer named goods such as Laura Ashley (Bloomberg 2014).

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CAMPAIGN OBJECTIVES AND STRATEGIES

Home Depot Marketing Objectives and Strategies

Objective: To improve the effectiveness of customer service to the target audience by 75% in six months.

Objective: To increase sales through direct mail advertising for the target demographic by 60% in six months.

Objective: To increase brand awareness among target audience by 65% in six months.

Strategy: Work with managers and employees, particularly female employees to improve customer satisfaction

Strategy: A direct mail campaign targeting female property owners

Strategy: Increase brand awareness among women 30-50 with in-store workshops, targeted advertising, and emails directly target to the female buyer.

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INTEGRATED CREATIVE STRATEGY STATEMENT

One of the most important components of an integrated marketing communications program is the advertising message (Belch 258). Good creative strategy and execution can often be central to determining the success of a product or brand (Belch 260). Many creative people say it is important for clients to take some risks if they want breakthrough advertising that gets noticed (Belch 266).

Established home improvement retailer

Experienced and trained employees

DIY Workshops for women How-to Task Specific,

Informational Banners Throughout Store

Price Matches Discounts for loyal customers You Tube DIY Channels

Women stick together Women want to build confidence How-to demonstrations for women

by women Made to feel like part of a team Somebody’s got to do it Seeking trusted experienced

assistance Easy to find direction

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REJECTED CREATIVE STRATEGY STATEMENTS AND INTEGRATED

CREATIVE STRATEGY STATEMENT

Statement: We stick together.

Statement: We want to bring out the DIY-er in you.

Statement: Somebody’s got to do it.

Statement: Together we can fix it.

Statement: I am woman, hear me fix!

Core Strategy Idea: Somebody’s got to do it.

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CREATIVE BRIEF

The smaller the brief, the bigger the ideas (Beloved Brands).

Creative Brief

Client: Home Depot

Type: Television Ad

Why are we advertising?

To increase sales among women

Whom are we talking to?

Women who want to get their home improvement projects done

What do they currently think?

Women believe they need a man to fix things, they can’t do it themselves

What would we like them to think?

Women are capable of completing home improvement projects

What is the single most persuasive idea we can convey?

Home Depot wants women to know that they can do it

Why should they believe it?

Home Depot is willing to offer workshops and expert advice specifically designed for women

Are there any creative guidelines?

One 30 second TV spot

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CREATIVE EXECUTION

Sample Creative Execution-TV Ad

Client: Home Depot

Title: The Faucet

Length: 30 Seconds

Writer: Mariah Abell

VIDEO AUDIO____________________

1. Shot of faucet leaking 1. Sound of water spewing

2. Woman walks to living room 2. “Honey, the faucet is leaking again!”

where her husband is watching the game

3. Husband doesn’t look away from the TV 3. “ Did you hear me…the faucet is leaking again! “I’ll fix it when the game’s over!”

4. Wife goes to Home Depot, talk to associate 4. Sound of clock ticking; graphics: 3 hours later

purchases supplies,

5. Husband walks into kitchen and discovers 5. “I thought you said it was leaking!”

Wife has fixed the leak and bought a new faucet

Has a look of surprise on his face

6. Woman walks to local Home Depot and

speaks to employee who shows her

new kitchen faucets and how to install it

7. She is holding a wrench and has one hand on

hip with a satisfied smile on her face

1. Shot of faucet leaking

2. Woman walks to living room where her husband is watching

the game

3. Husband doesn’t look away from the TV

with associate and purchases supplies

5. Husband walks into kitchen and discovers his wife has fixed the leak

6. Husband has a look of surprise on his face

7. Woman is holding a wrench and has one hand on hip and has a satisfied smile on her face

1. Sound of water spewing2. Wife: “Honey the faucet is

leaking again!”3. Wife (sounding annoyed): “Did

you hear me…the faucet is leaking again!” Husband: “I’ll fix it when the game’s over!”

4. Sound of clock ticking5. Graphics: 3 Hours Later6. No audio7. Announcer: “Well, somebody’s

got to do it!”

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MEDIA OBJECTIVES AND STRATEGIES

BUDGET

Home Depot spent $771.7 million dollars in advertising in 2013 up 737.6 million in 2012 (Statista 2014). My media plan for Home Depot will be a six-month campaign running from October 1st to March 31st.

My budget will allocate as follows:

50% television advertising 20% mobile marketing 10% social media 10% websites 10% print advertising

MEDIA OBJECTIVES

1. To reach 75% of the target audience in major metropolitan markets (New York. Los Angeles, Washington D.C., Chicago, Houston) with a frequency of 10 ads in each market, each month over the six month campaign.

2. To reach 75% of the target audience in the Midwestern markets (Detroit, St. Louis, Minneapolis, Indianapolis, Cincinnati, Cleveland, Kansas City, Louisville) with a frequency of 20 ads in each market, each month over the six month campaign. I have chosen to advertise in the Midwest because competitors Lowe’s and Menards concentrate in the Midwestern markets.

MEDIA STRATEGIES

1. For the major metropolitan markets I will allocate 50% of the television budget and air 30 second spots to air on the broadcast and cable networks. The entire print advertising budget will be spent in the national market as will social media and websites.

2. For the Midwestern markets, I will allocate the other 50% of the television budget and use the entire mobile advertising budget to create target advertising using location services on smartphones.

MEDIA TACTICS

Television

Television combines sight and sound, an advantage not offered by most media (Belch 328).

Broadcast-98% of households own at least one TV set.

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1. ABC-reaches 75.7% of households (National TV Spots 2006). I am purchasing 30 second spots on Thursday nights when Grey’s Anatomy, Scandal, and How to Get Away with Murder air. Scandal is one of the top rated programs for women.

2. CBS-reaches 74.9% of household (National TV Spots 2006) I am purchasing 30 second spots during The Good Wife on Sunday nights and The Big Bang Theory on Monday nights in the month of October, then I will my advertising to Thursday nights starting October 30 when Big Bang resumes its permanent time slot (Deadline 2014).

Cable1. HGTV has over 90 million subscribers (Kagan 2006). I will buy 30 second spots to air during

popular HGTV shows House Hunters and Love It or List It.2. DIY-airs in over 53 million homes (National TV Spots 2006). I will buy 30 second television spots

that will air during female-hosted shows such as Kitchen Crashers, Sweat Equity, Mega Dens, and Rehab Addict.

3. Lifetime is the sixth top rated cable station and has over 90 million subscribers (Kagan 2006). I will buy 30 second television spots to air during the 7-10pm primetime weekday hours.

4. FX-airs in over 95 million homes (National TV Spots 2006). I will buy 30 second television spots on Wednesday nights during the 13-week run (October-January) of American Horror Story: Freak Show. AHS is one of the top-rated shows for women with over 59% female viewership (Thielman 2014).

Print

1. HGTV Magazine is the 8th best-selling monthly magazine on newsstands and has a circulation of over 1.3 million (HGTV Media Kit 2014) I will buy cover 2 at 5% with 3 pages (one full color page ad for 3 issues) at $77,188. In the January/February 2015 issue, the rate in the same category will rise to $84,906 (HGTV Media Kit 2014).

2. Better Homes and Gardens have a female demographic of over 80% and its circulation is over 7 million. I will buy 2 full color whole pages at the price of $552, 970 (BHG Media Kit 2014).

3. Redbook is targeted to women 25-45 who are going through key life decisions (Writers Market 2014) including buying and/or selling their first home. Redbook’s circulation is over 2.2 million. I will buy 4 full page ads at the cost of $111, 800.

Social Media

1. Facebook-I will buy $500 per day promotional ads to target women in the United States2. Twitter-I will use 3-5 promoted tweets per day to non-followers by tailoring the tweets to target

women who are looking for help with their DIY projects.3. Pinterest-I will use the new “promote pins” advertising. Since Pinterest is new to the advertising

market, there is not enough data to show how much it will cost.

Websites

1. HGTV-buy banner ads on the HGTV home page

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2. DIY-buy banner ads on the DIY home page3. Hulu-buy sponsorships during 5 female skewed shows including the #TGIT lineup

Mobile Advertising –Home Depot was one of the earliest retailers to embrace mobile advertising. (Funmobility 2014). They started advertising on mobile in 2010 and are ahead of the curve in regards to mobile advertising. Home Depot has done several mobile redesigns now including over 1000 how-to videos (Think with Google 2012). I will use the 2.5 million mobile advertising budget to target the Midwestern market by using location based advertising.

FLOW CHART

The flow chart will be in a Microsoft Excel file.

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PUBLIC RELATIONS OBJECTIVES, STRATEGIES AND TACTICS

Definition of Public Relations

What is public relations? According to Public Relations News, public relations is “the management function which evaluates public attitudes, identifies the policies and procedures of an organization with the public interest, and executes a program of action (and communication) to earn public understanding and acceptance (Belch 2014 p. 573).” An effective public relations program can continue over several months, possibly even last years (Belch 2014 p. 573).

Public Relations Objectives

PR Objective-a statement of the outputs, outcomes, or business results a PR effort is designed to achieve. They are narrow, precise, and measurable.

1. To increase the participation and number of Do-It-Herself workshops by 50% in one year. A blogger gave her local Home Depot workshop a bad review. Her website Grinning Like an Idiot, is one of the top 15,000 websites in the United States (Alexa 2014). She looked forward to the class, but it was not what she expected. The staff was not helpful and the employee did not demonstrate how to handle any of the tools used. As explained in her post, she now has a more positive experience with competitor Lowe’s.

2. To increase the value of Home Depot to females by 50% using social media and endorsements. Pinterest is excluded because Home Depot has already used it to target women successfully.

Public Relations Strategies

PR Strategy-a plan of action designed to achieve an objective; the overall direction you are going to take.

1. Collaborate with Stephanie, the blogger for Grinning Like an Idiot, to create a user-friendly the Do-It Herself workshop.

2. Obtain endorsements from highly influential women like Oprah Winfrey and female hosts on HGTV and DIY Network. Utilize these endorsements on social media.

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Public Relations Tactics

PR tactic-a specific action step required to deliver on a strategy.

1. Have people who participated in the DIY workshops build a home for a single mother with Habitat for Humanity. Have local media cover story.

2. Send workshop press releases and invitations to workshops to print outlets, women’s organizations, and female-owned businesses.

3. Publicize endorsements from highly influential women on social media utilizing video of them with tools, showing snippets of DIY projects.

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DIRECT MARKETING OBJECTIVES AND STRATEGIES

Direct Marketing-a system of marketing by which organizations communicate directly with target customers to generate a response or transaction (Belch 2014 p.474).

Direct Marketing Objectives

1. To increase sales in the flooring department to female home owners by 50% in six months.2. To increase direct mailings to female homeowners by 75% in six months and have an 80%

response rate.3. To get 75% of new female customers to buy exclusively at Home Depot for their home

improvement needs in six months.

Direct Marketing Tactics

1. A catalog (online and print) that caters to the female buyer. The catalog would have what women want to shop for at the Home Depot. It would also have some how-to projects that she could finish in a weekend (build a bench, spray paint old chandelier, etc.).

2. Email blasts directed to the female customer. First I would partner with Constant Contact to create a direct mailing database exclusively for women. I would create a personalized email to each female customer about our offers and sales. Some customers would be randomly selected to take part in a survey about how well we did on email blasts and whether they would shop at Home Depot and/or tell their friends about it.

3. Testimonials from current female shoppers. I would take several names from the customer database and call or email and ask them if they would like to participate in a testimonial video that would be posted on Home Depot’s Facebook page. They would explain to new customers why they shop at Home Depot and its benefits.

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SALES PROMOTION OBJECTIVES AND STRATEGIES

Sales Promotion-a direct inducement that offers an extra value or incentive for the product to the sales force, distributors, or the ultimate consumer with the primary objective of an immediate sale (Belch 2014 p.520)

Sales Promotion Objectives

1. To increase the sales in the flooring department purchased by women by 60% in six months.2. To get 75% of female customers to sign up for a new loyalty program in six months.3. To entice 75% of new female customers to follow Home Depot on Twitter and Facebook.

Sales Promotion Tactics

1. Introduce a refund and rebate program for the customer. For example, if the flooring delivered to the customer’s home is severely damaged, Home Depot will let the customer trade in for a new floor at no cost, regardless if the new floor the customer has chosen costs more than the previous floor.

2. Introduce a loyalty program, one of the fastest growing areas of sales promotion (Belch 2014 p.552). For every $10 spent at Home Depot, the customer will receive 1 point in the program. There will be a milestone for a certain number of points. For example, if a customer gets up to 10,000 points, they will receive a free floor installation with the purchase of the flooring.

3. Conduct a contest on Facebook and Twitter. If a customer shares a photo with 10 people, they will be entered into a drawing to receive a $50,000 home improvement makeover.

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MEASUREMENT AND EVALUATION PLAN

This integrated marketing communications plan revolves around increasing brand awareness and sales in stores and online. These objectives will be measured throughout the six month campaign to gather information about specific aspects of the plan as well as post-testing to evaluate the plan in its entirety.

In six months, we will create a survey contacting people using our mailing we created six months before. We will ask how your opinion has changed of Home Depot in the past six months, are they more loyal to the Home Depot brand, and will they recommend Home Depot to their friends? We will also ask if they have any recommendations to improve the Home Depot brand.

With the Do-It Herself workshop, we will get attendance levels from Home Depot associates and have evaluation forms to be filled out after the workshop is completed. We will ask customers if they enjoyed or did not enjoy the workshop and will they attend another workshop in the near future. We will also ask if they suggest any recommendations to improve the workshops.

Social media metrics will be evaluated throughout the campaign. We will measure the reach and engagement of customers on channels like Facebook and Twitter. We will see how many customers have started following Home Depot’s social media pages since the start of the campaign, and how many posts they have shared in the past six months.

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CONCLUSION

In conclusion, a true marketing communications plan is the development of marketing strategies and creative campaigns that weave together multiple marketing disciplines such as paid advertising, public relations, promotion, and social media that are selected and implemented to suit the goals of the brand. This plan will help Home Depot grow over the course from October 2014 to March 2015. The objectives included in this plan can be efficiently measured and the tactics are well researched, thought out methods to improve the position and brand awareness of the company. Many of the strategies to be implemented will accomplish more than one goal, making the plan most cost efficient.

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