*Lowe's Beats Home Depot to Online Sales

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Lowe's Cos. Inc. beat rival home improvement retailer Home Depot Inc. with a new online store that allows consumers nationwide to buy tools and appliances over the Internet.

The site at www.lowes.com targets the do-it-yourself segment, debuting with 3,000 appliances and 8,000 tools. The company plans to have 100,000 products by 2002. The site debuted after Lowe's tested e-commerce waters with kobalttools.com, harborbreezefans.com and reliabiltdoors.com -- sites based on private-label products sold in company stores.

"We wanted to get some experience in the e-commerce environment and build that experience online," said Matt Deeter, vice president of Internet operations at Lowe's, Wilkesboro, NC.

Lowes.com has been up as an information-only site since 1995, complemented by a separate e-commerce site targeted to contractors, home-improvement specialists and other commercial customers.

In its new guise, lowes.com sells to a national audience. In contrast, homedepot.com allows only Las Vegas area customers, both professionals and do-it-yourselfers, to buy online with prices on par with retail stores.

Home Depot, Atlanta, admitted that problems with developing a dependable fulfillment system for its 50,000-plus products were a key reason for not going national with e-commerce. Las Vegas is a litmus test for the company.

Lowe's, on the other hand, said it has settled delivery, fulfillment and back-end issues. It will leverage its traditional retail strength by allowing deliveries from, and returns to, its 629 stores nationwide. Products also will be fulfilled through a central distribution center.

"I think the basic thing is logistics and customers' perceptions of what they want to get," Deeter said. "A lot of the products that we offer at the home improvement store are ones that people would want to see [online]. ... So what we wanted to build was a very informational site for them that also has commerce opportunities for Lowe's."

Lowe's will promote the site in trailers at the end of TV spots for its stores and via mentions in circulars, tool catalogs, free-standing and Sunday newspaper inserts, credit card mailers and on bills.

The retailer is not too gung-ho on e-mails or other online marketing such as banner ads. Besides, it has yet to build a sizable e-mail database.

"What we've found is that credit card mailers and different things like that have given us a bigger bang for our buck than traditional Web click-through ads," Deeter said.

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