Lowe’s Takes the High Road
Charlotte, N.C., June 2--At Lowe’s annual shareholders meeting, company president Robert Niblock made it clear that the nation’s second largest home channel retailer does not mind pushing higher priced items in order to maintain a higher image in the minds of customers.
Niblock was referring to the exclusive brands Lowe’s carries such as Miracle Gro specialty plants, Pella, Cub Cadet and Amana; prices of Lowe’s products are often higher than those found at competitors.
"If we need those products to be effective, they’ll be in the lines," Niblock said. "It’s not a pricing strategy but a merchandising strategy." For example, Lowe’s is introducing a new premium line of carpet this year, Mohawk Premier Living, along with laminate floor lines from Pergo and Armstrong. Lowe’s will be "the only retailer to stock Pergo and Armstrong," Niblock added.
The Wilkesboro, N.C.-based retailer is also raising its visibility and has signed on as the exclusive sponsor of "Trading Spaces," the Learning Channel network’s No. 1 rated program, which has rapidly become a cult favorite. Niblock said Lowe’s "value-added media initiative" reinforces the retailer as "the choice for home improvement."
The initiative also conveys Lowe’s position as a modern, progressive and energizing company, Niblock said.
Niblock said Lowe’s has also set its sights on garnering a bigger chunk of the $32 billion per year installed sales market. Lowe’s rang up $1.1 billion in installed sales in 2002 — about 20 percent of the company’s overall sales — and plans to double that number by 2005.
At the same time, Lowe’s is focusing on its core pro market — pros who serve homeowners such as remodelers, plumbers, electricians and property managers. The company is currently testing a 128-store pilot designed to build a "scalable" installed sales model, Niblock said.
"If [installed sales] is properly executed, everyone wins — Lowe’s, our installers and most importantly, our customers," Niblock said.
Related Topics:Armstrong Flooring, Mohawk Industries
