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Lowes vs. Home Depot | Which One Needs More PPC Improvement?

Lowes-vs-home-depot As a typical consumer, I have purchased products from both Lowes and Home Depot. With that said, as someone who eats, drinks and breathes PPC, I always wonder about what the competitors are doing in Paid Search Marketing. In my very quick analysis, I identified some interesting tactics which first led me to believe that both companies either hired the same PPC marketer or agency or the PPC strategy was stolen by one of them because they are very, very similar. But after some looking around, I noticed that one of the companies was a little more effective that the other with regard to PPC, but both of them are missing the “BIG PICTURE” as neither of them are embracing the product specific “Long Tail”. In this post, I will discuss the differences, similarities and hope to identify opportunities for both companies to get more out of their PPC efforts

A Brief History of the Two Companies:

Lowes was founded in 1946, serves 14+ million customers per week, and has over 1,616 stores in US and Canada. It is obviously the second largest hardware chain behind Home Depot. Click here to learn more about the History of Lowes.

Home Depot was founded in 1978, operates over 2,193 stores in the US and Canada and employs more than 330,000 employees across the U.S. Click here to learn more about Home Depot.

Ad Text Messaging:

Both companies do a similar job is their Text Ads. They both use more than one ad (just refresh) and quite honestly the similarities are staggering. For example, see below

Key Similarities:

  • Both use “Official Site” in all their Ads
  • Both use “Tools, Appliances & Hardware. 
  • Both use “Shop Quality…..”
  • Both use “Top Brand…”

Key Differences: (NOT MANY)

  • Lowes uses “& more online…..”, where Home Deport does not
  • Home Depot uses a tagline “More Saving, More Doing”

Trademark: (Strongly Enforced)

Both companies surprisingly have NO ONE else bidding on their Trademark name, not even each other.  Even Misspellings and different permutations of the trademarks are “untouchable”

Competitive Bidding:

With regard to their names, they are all by themselves. The only competitors in this space are for categorical searches, generalized “head terms” and actual manufactured brand names.  For the search term “kitchen appliances”, and “appliances” Lowes and Home Depot are both competing for the space along with other online retailers. However, an interesting find was discovered with the search term “home improvement”, where neither companies are competing.

Missed Opportunities:

For many of the more expensive “HEAD” search terms, both companies make an appearance, but neither them or even the smaller online retailers are NOT EMBRACING THE LONG-TAIL, and that is astonishing to this PPC Geek. On the other hand, we need to keep in mind that the Lowes and Home Depot names have an immensely strong “brick and morter” following. When consumers visit their respected websites, the intent is not to always buy online, it’s to compare prices and warranties, check out inventories, locate a store, etc… With this complexity, the typical ROAS metric is basically thrown out the window, even if every event is tagged with analytics and tracked with a funnel, etc…

However, as more and more consumers use search engines to find specific parts, makes and models, serial numbers, etc… any opportunity to bring them to the website is an automatic WIN. For example, if Home Depot is bidding on specific “John Deere Mower”, a consumer will most likely review the Home Depot website and then get in the car and drive to the store. (In this example, Lowes is bidding on the term and Home Depot is NOT). If a text ad does not show up from a major retailer, I will be forced to go to another online retailer and compare prices. If the everyone is competing for the space, then let the comparison shopping begin. Reputation and past experiences usually are the deciding factors.

Why a Win? Here’s just a few reasons:

  • Lower CPC
  • Higher Intent to buy
  • Higher ROAS and ROI
  • Makes the PPC Guru look like a genius

In Conclusion:

Both companies have a very similar PPC strategy where protecting their respected Trademark name is their #1 priority. Of the two companies, Lowes appears to be doing a better job covering the most “real estate” in Google Search. However, I am little confused by the lackluster use of the “long tail” and “name brand” related search terms, as many other much smaller online retailers are winning the battle. The only battle Lowes and Home Depot have with each other.

It’s always a good idea to protect and reinforce brands, especially those as reputable as these two. However, when it comes to getting “an edge” on the competition, Paid Search can be a very effective tool to influence more people to walk thru the door, even if they do not click thru to the website. Meaning, a WTR% “Walk Thru Rate” would be more important than a CTR% Click Thru Rate.

Filed under: PPC Analysis & Case Studies

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