Unlocking Pro Insights: Decoding Category Dynamics in the Home Improvement Sector

As retail­ers shift their focus towards sup­port­ing the pro cus­tomers, under­stand­ing pro cat­e­go­ry dynam­ics will be crit­i­cal to the suc­cess of brands fight­ing for space in a com­pet­i­tive retail envi­ron­ment. Accu­rate­ly iden­ti­fy­ing cat­e­gories and prod­ucts that cater to the pro cus­tomers will be vital to cap­ture long term share with an increas­ing­ly impor­tant set of customers.

Using Data­va­tions pro­pri­etary data set of store and SKU lev­el vol­ume and pric­ing data, we ana­lyzed over four hun­dred home improve­ment cat­e­gories to build a PROpen­si­ty Index that iden­ti­fies pro pre­ferred items, brands and cat­e­gories. Using this index we’ve iden­ti­fied the fol­low­ing trends: 

• Build­ing Mate­r­i­al and Labor-Inten­sive Depart­ments such as Scaf­fold­ing, Roof­ing, Insu­la­tion, Show­ers & Bath­tubs and are dom­i­nat­ed by the Pro cus­tomer while sea­son­al Depart­ments like Lawn and Gar­den see most of their vol­ume dri­ven by the DIY customer.
• Sea­son­al vari­a­tions show that cat­e­gories which are in-sea­son shift towards the DIY cus­tomer, while out-of-sea­son pur­chas­es are typ­i­cal­ly dri­ven by the pro customer.
• Weath­er-depen­dent cat­e­gories show sig­nif­i­cant region­al vari­abil­i­ty in the PROpen­si­ty Index, dri­ven by cli­mate dif­fer­ences, and retail­ers can use a pro-focused assort­ment in the off-sea­son to sup­port those sales.

Identifying Pro Categories In Home Improvement Retail

Pro cus­tomers’ pur­chase behav­ior will be more con­cen­trat­ed dur­ing the week­day as they turn to Home Improve­ment retail­ers to ful­fill their job-site needs. Accord­ing to sur­vey results released by HIRI, these cus­tomers val­ue the con­ve­nience of prox­im­i­ty, selec­tion and flex­i­bil­i­ty that home cen­ters can pro­vide. To sup­port these needs, we would expect to see a greater share of units sold dur­ing the week­day peri­od for these cus­tomers and use this along with bulk unit sales and pric­ing data to build our PROpen­si­ty Index.

After ana­lyz­ing the SKU and store lev­el sales data for over hun­dreds of dif­fer­ent Home Improve­ment cat­e­gories at the major home improve­ment retail­ers, we found that the cat­e­gories with the high­est affin­i­ty for the pro cus­tomer are build­ing mate­ri­als or big box remod­el­ing cat­e­gories. Scaf­fold­ing, Dry­wall, Bath­tubs and Show­ers are among the top scor­ing depart­ments iden­ti­fied as pro by our index.
On the oth­er end of the dis­tri­b­u­tion, typ­i­cal DIY depart­ments such as Lawn Care, Water­ing & Irri­ga­tion, Bath­room Acces­sories, and Clean­ing Tools are shown to have rel­a­tive­ly low affin­i­ty for the pro-con­sumer and are dom­i­nat­ed by DIY cus­tomers who are look­ing to com­plete small projects over the weekend.

Pro Customers Drive Out of Season Volume

The PROpen­si­ty Index, while rel­a­tive­ly sta­ble for build­ing mate­ri­als cat­e­gories month to month, sees major fluc­tu­a­tions in more sea­son­al DIY cat­e­gories. Lawn Care cat­e­gories such as fer­til­iz­ers and grass seed see a major shift towards DIY dur­ing the spring and ear­ly sum­mer months, mov­ing back towards pro in July. These pro cat­e­gories see some spikes month to month but have rel­a­tive­ly sta­ble pro affin­i­ty through­out the year.

Climate Drives Regional Differences in High Pro Categories

Tak­ing a clos­er look at the Con­crete, Cement & Stuc­co Mix depart­ment, we can see that region­al vari­a­tion is dri­ven pri­mar­i­ly by dif­fer­ences in cli­mate. The Mid­west and Cen­tral regions see a sig­nif­i­cant­ly high­er affin­i­ty for the pro cus­tomer dur­ing Win­ter when com­pared to Sum­mer, while warmer regions see only a mod­est increase in the PROpen­si­ty Index dur­ing these months. Account­ing for region­al dif­fer­ences and the impact of cli­mate will be key in paint­ing an accu­rate pic­ture of the pro cus­tomer and track­ing pro cus­tomer trends over time.

These sea­son­al dynam­ics are crit­i­cal to under­stand­ing your busi­ness in a giv­en cat­e­go­ry and adjust­ing inven­to­ry to sup­port more pro-ori­ent­ed prod­ucts in the off sea­son can grow your brand as the pro-con­sumer makes up a big­ger share of the market. 

Join us for our webi­nar on Novem­ber 7th, 2024, as we take the PROpen­si­ty index and apply it to items with­in cat­e­gories. Our work will guide lis­ten­ers on using sales data to ana­lyze items with high pro-affin­i­ty and present strate­gies to cap­i­tal­ize on Pro focused mar­ket oppor­tu­ni­ties in the Home Improve­ment space.