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You’ve got 12 months and the clock is ticking…

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Let’s face some uncomfortable truths, big-box DIY retailing has probably had its day. There will not be any new, monster-sized Home Improvement warehouses built in the UK and without doubt, we will see a further contraction of the leading ‘shed’ retailers. Since 2014, B&Q and Homebase have closed 165 stores across the UK and Ireland and with the future of Homebase hanging precariously in the balance, we can be certain of more store closures to come.

With the largest generation of humans that ever existed, just about to reach prime home and garden spending age, the impact of the millennials will further transform the industry in ways we probably haven’t even considered yet and whether supplier or retailer, the digital disruption of your business models is inevitable.

One thing is for certain, doing the same thing year after year and hoping it’s going to deliver the same or better returns or even worse, sticking our heads in the sand and doing nothing, will guarantee one thing – a slow and painful decline in both sales and profit.

Retailers doing the same thing is what I see every time I enter the UK’s leading Home Improvement stores and garden centres. Yes, there’s sometimes new products available, (although far fewer in recent years) and yes, every year there’s new point of sale and merchandising, but there are no game changers, nothing in my view that’s going to save the industry from a slow and painful decline.

If you don’t agree, take a look at the products featured in any B&Q, Bunnings, Wickes, Wyevale door-drop brochures, TV adverts or the homepages of their websites. Take a good look at the promotional ends currently featured in stores, during what is the peak period of the year and what do you find……. the same old stuff, that was there last year and the year before and 10 years ago. Give yourself time to watch some old Do It All, Texas, B&Q, Great Mills and Focus TV adverts on YouTube from 30 years ago and you’ll see it’s the same old stuff, every year, it’s genuinely alarming how the industry has not progressed during that time.

So, are we as manufacturers and retailers of DIY and Garden products ultimately doomed? Is our industry having to face the fact that our consumers of the future will be predominantly generation renters, buying a few home improvement bits and bobs every now again through one hour delivery from Amazon and at the weekend renting power tools, BBQ’s and garden furniture they simply don’t have the space to store anyway?

Well, yes that is the future and if you’re not already thinking and planning how you as a brand are going to tackle that challenge, I suggest you wake up and take a look outside, because the tsunami of change is already seeping underneath your door.

So, what options do we have? What choices can we make today to prepare our brands and future proof our companies and staff?

The answer is creative innovation, game-changing, new category innovation. An exciting new category that has the potential to change the entire perception of a retailer’s brand, attract new younger millennial customers into store and reinforce existing customers views that Home Improvement retailers are the place to go for the latest trends, ideas and quite simply interesting new stuff.

We’ve been searching for some time for the game-changer, the innovation in the home or garden category that creates so much interest that consumers simply have to come to stores to see it, play with it and test it out. Something so popular that the retailers social media accounts creaks under the weight of the engagement and conversation.

We’ve been searching high and low and finally, ladies and gentlemen, today I can announce that I think we’ve damn well found it.

We looked to the US and studied the one company that can claim probably more than any other that ‘Imitation is the sincerest form of flattery’. B&Q, Brico, Castorama, Bunnings in Australia, Builders Warehouse in South Africa and many other global big-box DIY retailers only exist because they copied The Home Depot model in the US. And when I say copied, I mean copied EVERYTHING, from the look and feel of the warehouses, to the ranging, the systems, how the staff dress, even the stupid aprons and even more stupid badges.

But here’s a really interesting point – in the last 5 years, I think we’ve stopped watching and copying Home Depot – and why is that? Have we learnt everything we need to know and no longer need to learn from other businesses or has the intensity of our own, all consuming navel gazing, made us blind to what’s happening outside of our little country.

In the last five years The Home Depot has been relentlessly searching for the same thing. The category game changer that will guarantee their future as a retailer and in the process, change the perception of them in the eyes of their existing customers and attract a whole new generation of consumers through their doors.

And the answer is the Smart or Connected Home Category.

We’ve recently seen the ‘Smart Home in-store portal’ in Home Depot– a front of store promotional end showcasing the full range of connected home products available, including products from brands such as Google, Amazon, Philips, Nest, Ring, Samsung, Sengled, ecobee4, Vine, Schlage, WeMo and Wink.

The concept is unique because it brings all of the products together and effectively introduces them as a total ‘Smart Home’ category solution to consumers. Every product is live and can be played with and every touch and every interaction made by shoppers is tracked, analysed and fed back to the retailer.

Although something of an obvious opportunity, this presents a real challenge to UK Retailers, who often seem to struggle to see past their historical, functional, product led approach to buying, merchandising, store layouts and promotion. When categories such as Connected Home come along that span a number of different product areas and buyers, they are simply not set up to execute this effectively, often lacking the category knowledge, expertise or simply structure to make good and quick decisions.

This is further complicated by the many and growing number of brands in the connected home category using different technologies/platforms, making it difficult for retailers to present the total solution. This often leads to brand specific or individual product displays appearing in different locations around the store, watering down and removing the opportunity to range extend and cross-sell into new high-ticket product areas.

This category is still in its infancy, although globally, it’s growing rapidly and will without question be the largest, fastest growing and most valuable home related category of the future. Think the internet of things and how in time every digital item in your home, from your lights, TV’s, white goods, alarms, plug sockets, broadband, heating, fans, boiler, burglar alarms, door bells and locks, showers, electric car and of course your phones will be connected and you’ll be able to simply and easily communicate with them all through one voice activated device.

It’s the reason why a new ‘space race’ is taking place on earth today between Apple, Amazon and Google to own our homes of the future. It’s why Amazon paid £720m for Ring the video doorbell company in March and why we’ll see significant investment in this category for many, many years into the future.

Read – Amazon acquires video doorbell company Ring for £720m.

However, the interesting point is that Amazon, Google and less so Apple, all need retailer outlets and support to get these products in front of as many potential customers as possible, as quickly as possible. With so many of these products being new to consumers, we’re not content to just look at pictures online, we want to touch, feel and play with the items and that’s where stores play an absolutely vital role.

The company behind this innovative, category approach to the Connected Home is Outform, a UK based ‘experience, innovation agency’ who for the first time have allowed all the smart products to be integrated onto one single interactive digital display.

Some of the UK’s largest retailers have already recognised the opportunity and have taken steps to ‘own’ and become famous for the Smart Home category both from a supplier and consumer perspective. The first movers are John Lewis, Curry’s PC World and before their untimely demise Maplins. Here’s what these companies are already doing: –

We understand the Home Depot trial of the Smart Home in-store portal has been so successful, it’s now being rolled out to many more stores and other retailers in the US have cottoned-on and are moving quickly to join the race – Bed Bath & Beyond have decided they want a piece of the action and you can see their version of the unit here: –

With John Lewis and Curry’s/PC World riding off into the sunset with the gold, where are our Home Improvement retailers in this Smart Home race? B&Q have embraced it in some categories such as locks, alarms and CCTV camera’s, predominantly due to the great work done by Yale and if you look hard enough in the plumbing category you might find a picture of Nest product hidden away by some central heating chemicals. Wickes and Homebase dip their toes into smart alarms and CCTV systems, but a consumer facing smart home solution, do me a favour.

In reality, the Home Improvement retailers, whose very name tells you what they sell, are nowhere – no category solution, no education process, no reason to visit the store, nothing to advertise or promote that these products are available, they’re not even currently in the game. Correction, they don’t even know when the game is on and they’ve forgotten their trainers. The retailers who have owned Home Improvement for over 30 years have missed the boat and unless they do something in the next 12 months, will not even be part of the consumer selection process when this category really takes off.

Owning and becoming famous for a new category like this is absolutely critically and provides an opportunity so significant that I believe it genuinely could be a life-saver. Just imagine for a moment a TV advert from B&Q or Wickes showcasing these products to a population of millennials hungry for new, cool Smart Home stuff. Come and see live products and play with them, with trained staff on hand and all wrapped up into a gold standard home installation service – a step too far? What do you think?

So, B&Q, Screwfix, Homebase, Wickes, Toolstation, Argos, Wilko, Robert Dyas and even The Range, fancy a piece of the action?

I think you’ve got 12 months maximum and the clock is ticking……

This article was written by Steve Collinge, who can be contacted on Steve@irg.co.uk and followed on Twitter and Linkedin.

For more information on Outform, you can visit their website here and contact them here.

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insightdiysteve View All

Founder and Managing Director of Insight Retail Group and the Home Improvement & Gardening Industry news and intelligence website Insight DIY.

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