Executives at The Home Depot said yesterday that its direct-to-consumer division has the potential to become a billion-dollar business by 2010.
In a presentation to investors, The Home Depot, Atlanta, unveiled its growth targets for 2010, which include building on the strong results already generated by the company's Web site, www.homedepot.com, and its two catalogs, 10 Crescent Lane and Paces Trading Company.
Though still a small percentage of Home Depot's total revenue, the DTC results are promising, the company said. In 2005, online sales doubled and more than 3 million shoppers visited the company's online properties each week.
On the Monday after Thanksgiving, Home Depot's site received 65,000 orders, company chairman/CEO Bob Nardelli said at this week's National Retail Federation's 95th Annual Convention & Expo in New York. Nardelli also said he plans to use the scope of Internet marketing in the display aisle across the company's 2,000 stores nationwide.
Home Depot is using catalogs to expand the brand's positioning by targeting upscale women, Shelley Nandkeolyar, president of The Home Depot Direct division, said at last month's National Center for Database Marketing Winter 2005 Conference in Orlando, FL. In September, Home Depot launched 10 Crescent Lane, a catalog featuring items such as candlesticks, brushed-steel scones and Oriental rugs, targeting women 30 and older with a high-income household profile of $175,000. It also recently launched Paces Trading Company, which focuses on high-end lighting.
In the next five years, the company expects to open 400 to 500 new retail stores, it told investors yesterday. It also expects to continue double-digit growth in its services business, and its at-home services such as flooring, fencing, roofing, cabinetry and others will account for almost 6 percent of its sales by 2010.
Another area of growth is the company's wholesale business for the professional market. By 2010, it expects that Home Depot Supply will generate 19 percent of overall sales. By the end of the decade, the division expects to operate 1,500 locations and to be the largest diversified wholesale distribution business in the United States.
Executive editor Mickey Alam Khan and senior editor Melissa Campanelli contributed to this report.