Mooresville-based Lowe’s Inc. is turning to a Seattle-based data aggregation company in a bid to boost its sales, the home improvement retailer said this week.
Lowe’s is rolling out a partnership with Porch.com at about 140 stores in the Carolinas. Once the company has evaluated the program’s results, Lowe’s will decide whether to expand to other markets.
Here’s how it works: Using public records and private sources, Porch.com collects information on contractors and plots it on a map. That lets users, for whom the service is free, see what kind of home projects are in their neighborhood, and which contractors are doing them. People can also review and endorse contractors, and those professionals can pay Porch.com to advertise.
Now, Lowe’s workers in the Carolinas will have data from Porch.com available in-store, allowing them to recommend contractors for projects Lowe’s doesn’t offer installation services for.
Without Porch.com, “Our associates would be really limited” in recommending contractors to help complete projects, said Jay Rebello, Lowe’s vice president of new business and corporate innovation.
“That’s a gap we’ve had in the past,” said Rebello.
Lowe’s executives have spoken of the need to improve “close rates,” or the percentage of customers who come in and actually make a purchase. Having data available to point customers toward reliable contractors increases the chance of closing a sale to a homeowner who is unsure whether they know enough to finish a project on their own.
Porch.com’s extensive data library also opens up possibilities for Lowe’s to create more sales by pointing customers toward a project they might not know they need, Rebello said.
“Through gathering all this data, you can really identify a certain neighborhood is going through a wave of roof replacements,” he said, as an example. “I wouldn’t call it marketing. I’d call it more preventative maintenance.”
Lowe’s also hopes the Porch.com partnership will help it beef up its standing with professional customers. Contractors will be able to create a free profile on Porch.com and gain customer exposure, Rebello said.
Lowe’s, the nation’s second-largest home improvement company, has lagged its larger competitor Home Depot in sales to contractors, a lucrative area. Such sales make up about 25 percent of Lowe’s revenue, compared with about 35 percent at Home Depot.
In 2011, Home Depot bought Redbeacon, a website that connects customers with contractors who have previously been vetted.
“This acquisition enables us to deliver on consumer expectations by making it easier to get these projects done; it allows us to help our professional customers find jobs; and it builds relationships with our customers,” Home Depot said in a securities filing.
Matt Ehrlichman co-founded Porch.com in 2012. He said his goal is to “disrupt home improvement” with technology the way other industries, such as publishing and retailing, have been disrupted.
“It’s such a fragmented market,” said Ehrlichman of the builders, plumbers, handymen, landscapers and others who compose much of the home improvement professional market. “There are millions of these small businesses that are out there. It makes up such an important part of the U.S. economy.”
Portillo: 704-358-5041; Twitter: @ESPortillo