Shopper BehaviorAmong Home Improvement Consumers

HIRI Annual Conference

DIY Shopper Behavior Method Market Overview Household Segments Project Type Motivation Pre Trip Action & Research Channels Shopped In-Store Influences Products Purchased Spend Summary

Agenda

2

DATA PROVIDER

Analytics Custom Research

Syndicated Research

Method - Sources of Information

3

Shopper Behavior

Survey

Qualitative

Research Custom Database

Online Focus Group

In-Home Immersion

SessionShopping

Ethnography

Social Community

Ideation & Innovation

Session

In-Depth Interviews

Method – What’s Included? Tools, Materials, Products for DIY …

Patio, Deck, Porch, Siding, Roof, Gutters,

Fencing, DrivewayGarden,

Landscaping

Kitchen, Bath Remodel Room Addition

Windows,Doors

Interior Maintenance -Electric, Plumbing,

Flooring, Painting

Starting Out (n=18)

Families (n=140)

Married, No Kids (n=67)

Singles (n=96)

Mature (n=178)

Method – Who’s Included? Household Segments – 501 Respondents

• 1-2 adults in HH• May be married• May be children in HH• Not Retired

• 1 adult in HH• No kids• Not retired • 2 adults in HH

• Married• Children in

HH• Not retired

• 2 adults in HH• Married• No kids• Not retired

• 1-2 adults in HH• May be children in HH • May be retired

4% population

19% population

28% population

13% population

36% population

Method – Where? 7 Purchase Channels – Last Trip Made for DIY Materials

Specialty Retailer (54) Discount

Retailer (134)

Hardware Retailers (84)

Lumberyard/ Building Supply (31)

Warehouse/ Club Store (45)

Home Improvement Centers (409)

Department Store (44)

Market Overview

7

18000

20000

22000

24000

26000

28000

30000

32000

1 3 5 7 9 1113151719212325272931333537394143454749515355575961636567697173757779818385878991

Retail SalesBuilding Materials, Lawn & Garden Equipment and Supply Dealers

Mill

ions

of $

Source: U.S. Census Bureau

Retail sales rebounding for Building Material, L&G Equipment & Supplies,

from 2009/2010 low of less than $23,000 million

2005 2006 2007 2008 2009 2010 2011 2012

Household Segments

9

% Population

HH Age - Mean

HH Size – Mean

HH Income – Mean

% Married

% College Degree +

Home: % Single Detached

P6M Trips – Avg

Past Trip Spend – Avg

Starting Out (18)

4%

29

2.7

--

50%

61%

83%

4.1

--

Families (140)

28%

40

5.1

$107k

96%

55%

96%

4.4

$196

Married, No Kids (67)

13%

47

3.0

$83.9k

82%

35%

96%

5.1

$142

Singles (96)

19%

54

2.6

$74k

0%

37%

83%

4.9

$147

Mature (178)

36%

67

2.8

$93.6k

85%

42%

97%

4.8

$155

Household Segments

10

RECENT TRIP

Most Shopped Store Home Improvement Discount Retailer Hardware Store

Store Choice Reason Reputation Location Product Availability Brand In-Store Promotion Price

Reason For Project Aesthetic General Repairs

Starting Out (18)

83%33%33%

87%87%

40%13%

27%33%

33%

17%

Families (140)

77%32%20%

81%82%

62%30%

20%47%

34%

24%

Married, No Kids (67)

82%22%15%

82%67%

64%29%

20%47%

45%

34%

Singles (96)

82%30%15%

85%75%

67%30%

27%34%

41%

27%

Mature (178)

84%22%15%

87%84%

69%43%

20%49%

40%

31%

Household Segments (continued)

11

Shopper Behavior

12

13

Interior room upgrade/ remodel/ maintenance

Add/ Upgrade Garden/ Landscaping

Build/ Upgrade Patio/ Deck/ Porch/ Fencing

Bathroom remodel

Paint exterior/ Replace siding

Most Common Type of Project Interior Room - Remodels, Upgrades, Maintenance

Qu Which type of home improvement project did you buy these materials for?

28%

1 in 4

Shopper

Behavior

Interior room projects most

prevalent among Single Segment

Most prevalent among Mature

Segment

Families Married, No Children Singles Mature

140 67 96 178

29% 25% 34% 24%

Most prevalent among Family

Segment

(Base: 501)

Interior Room Projects Main Reason – Aesthetic Appeal Purchase Decisions – Mostly Male Head of Household

14Qu What was the ONE main reason for your DIY Home Improvement project?

Shopper

Behavior

(Base: 140)

Motivation for Most Recent Project Frequency(Base: 501)

Average Spend

Enhance aesthetic appeal/appearance 39% $155

General repairs/maintenance 28% $148 Enjoyment of working on DIY project 9% $195 Emergency repairs/maintenance 6% $159 Increase value of home 6% $237 Family member request 3% $180 Increase space 2% $224 Prepare the home to sell/put on the market 2% $203 Household member changes 2% $156

Project Motivators – All Projects Main Reason – To Enhance Aesthetic Appeal

15

Qu What was the ONE main reason for your DIY Home Improvement project?Qu On your most recent trip to [home improvement store] how much did you spend on the materials/tools you purchased?

Shopper

Behavior

16

Shopper

Behavior

Household Segments Families Married, No Children Singles Mature

  C D E F(Base) (140) (67) (96) (178)

Consulted family members/friends/neighbors 35% 27% 26% 28%

Consulted design expert(s) 9%F 3% 7%f 3%

Googled on the Internet for ‘how to’ advice, tips, specific instructions, etc. 25%eF 21% 16% 13%

Googled on the Internet for design ideas, pictures of displays, color coordination suggestions, etc. 27%EF 22%F 14% 11%

Pre-Trip Research and Activities Families are the most likely to consult with others

Note: A capital letter denotes a statistically significant difference at the 95% confidence level A lower case letter denotes a statistically significant difference at the 90% confidence level

17

Shopper

Behavior

Household Segments Families Married, No Children Singles Mature

  C D E F(Base) (140) (67) (96) (178)

Visited retailer websites for ‘how to’ advice, tips, specific instructions, etc. 21%df 10% 18% 13%

Visited retailer websites for design ideas, pictures of retailer/manufacturer displays, color coordination suggestions, etc. 17% 15% 10% 19%e

Visited manufacturer websites for ‘how to’ advice, tips, specific instructions, etc. 17%e 12% 9% 12%

Average Weeks On Project -Start to Finish-

Families = 12Married, No Children = 10

Singles = 11Mature = 11

Mean Satisfaction Planning/Research/Shopping

Families = 4.6Married, No Children = 4.7 c

Singles = 4.8 CFMature = 4.6

Pre-Trip Research and Activities (continued) Families are most likely to research online

Note: A capital letter denotes a statistically significant difference at the 95% confidence level A lower case letter denotes a statistically significant difference at the 90% confidence level

18

Families Married, No Children Singles Mature

140 67 96 178

77% 82% 82% 84%

Channel(s) Shopped Home Improvement Centers are the most common channel visited for home improvement project materials, tools, etc..

Shopper

Behavior

(Base: 501)

19

Qu Why did you choose to go to [STORE] to buy these materials/tools?Qu Which of the following influenced your purchase decision(s) inside the store?

Main Reasons for Channel Pick: Reputation & Trust Main In-Store Influences: Price, Item Availability

Shopper

Behavior

(Base: 409) (Base: 409)

20

Qu During this MOST RECENT trip for home improvement products, what type of materials/tools did you purchase?Qu On this MOST RECENT trip to [STORE], approximately how much did you spend on the materials/tools which you purchased?

Mean Spend/Segment ANY Project

Products Purchased Most Frequently Materials for Interior Room Remodeling Biggest Spenders Overall - Families

Shopper

Behavior

21

Qu During this MOST RECENT trip for home improvement products, what type of materials/tools did you purchase?

Interior Room Projects Products Purchased On Last Trip

Household SegmentsFamilies Married, No

Children Singles Mature

  C D E FBase: All Respondents (140) (67) (96) (178)

INTERIOR (NET) 93%EF 90%F 83% 77%

Indoor paint/ stain/ paint brushes /rollers/ tray / trowel/ edger/ paint sprayer/ scraper/ pads sponges/ drop cloths/ tarp 54% 51% 46% 47%

Nails/ screws/ bits/ sandpaper/ tape/ knife/ ruler/ blades/ cutter 42% 46% 39% 35%

Plumbing fixtures/ pipe/ valves/ faucets/ shower heads 24% 28% 26% 28%

Hand held tools (saw/ screwdriver/ hammer/ nail gun/ screw gun/ staple gun/ wrench/ pliers/ tape measure) 24%f 24% 18% 15%

Tile/ grouting tools/ caulk gun 26%F 16% 21% 14%

Trim/ crown molding/ finished hardware 20%F 12% 12% 9%

Power tools (saw/ sander/ router/ drill/ rotary) 23%DEF 6% 10% 8%

Electrician tools /wire strippers/ wiring 13%EF 7% 5% 7%

Ladder/step stool/ tool belt/ tool apron 10% 9% 11% 6%

Shopper

Behavior

Note: A capital letter denotes a statistically significant difference at the 95% confidence level

22

$50

$75

$100

$125

$150

$175

$200

$225

$250

$275

$300

Interior Room Upgrade

$163

Siding/ Gutters/

Roof$227

Kitchen Remodel

$191

Build/ Upgrade Patio/ Deck/

Porch/ Fencing$211

Bathroom Remodel

$171

Paint Exterior/ Replace Siding

$174 Garden/

Landscaping $142

(22)*

Project Spend/ Most Recent Trip Spend is highest for Outdoor Projects: Siding/Gutters/Roofing and Patio/Decks/Porches/Fencing

Mean Spend/ProjectMost Recent Trip

Qu On this MOST RECENT trip to [STORE], approximately how much did you spend on the materials/tools which you purchased?

Shopper

Behavior

(140)

Mean Spend

(48) (36)* (34)* (101)(23)*

*Caution: small base

23

Project Time Frame, Including Pre-Trip Room Additions Take the Longest and May Require Several Shopping Trips

Average Weeks

Shopper

Behavior

*Caution: small base

24

Trip Spend by Store Type Highest Spend – Lumberyard/Building Supply

$165 $176 $226 $216 $190

Shopper

Behavior

Summary

25

Family Segment

Male or Female HH most likely to have a college degree

Highest annual household income

Spends the most on DIY home improvement items

Makes the fewest trips

Most likely of Segments to undertake a Bathroom Remodel

Least likely to undertake a project for aesthetic reasons

Mature Segment

Comprises over 1/3 of the population

2nd highest Segment for spend on DIY home improvement items

More likely to care about Brand name

Most likely to engage in Gardening or Landscaping projects

Shopper

Behavior

Summary (continued)

26

Singles Segment

Least likely to own a single-family, detached home

Lowest annual income

Singles care more about In-Store Promotions than other Segments, but pay less attention to Price in general

Proportionately most likely to undertake an interior room remodel, maintenance, upgrade

Married, No Kids Segment

Smallest portion of the population and least likely to have a college degree

Makes the most trips for DIY items/materials

Spends the least on DIY items/materials

Shopper

Behavior