Tuesday, May 8, 2007

Demanding Views

Home Depot’s Rebuidling
Plan Missing The Mark

By John Gaffney

Seems like everyday you can add another company to the list of crisis managers. Someone gets rung up on customer complaints, bad service, SEC questions, data breaches and overpaying executives. Home Depot has been in something of a defensive posture since Bob Nardelli got his walking papers in January. It was rocked back on its heels a bit more by its shellacking on the MSN blogosphere in late March.
Time to play defense, right? Say you’re sorry? Wrong.
I would argue that the only thing Home Depot should be doing, in fact what any company that has faced a tough rack of problems lately, is use the crisis to be smarter about generating demand. You could say it’s “demand re-gen.” No matter what you call it, rebounding from a crisis doesn’t take away from the fact there’s one thing a business is about. And that’s creating demand through every fiber of its being.
For Home Depot, it’s no different. Here’s how I would put the pieces back together through a demand gen lens:

--Employee Programs: It’s my understanding that HD already has an aggressive employee reward program in place. Anyone who’s been there will tell you the results are spotty. Employees should be rewarded on return visits, incremental revenue and customer feedback. Everything they do when interacting with a customer needs to be based on two demand gen basics:
1) Customers talk to other customers.
2) Employees are the competitive differentiator in the race between HD and Lowe’s.
--Marketing: HD needs to generate demand among its core customers, and those are contractors. Contactors are going to make the big ticket purchases and they’ll tell the weekend warriors that HD is thumbs up or thumbs down. I would reach out through direct mail, email and strategically placed online campaigns to get the word out that HD wants you back if you’re a contractor. Apologizing to the newlyweds that want to buy a new light fixture isn’t going to generate demand.
--Operations: I would want to know how my contact center looks, sounds and feels. I would want to know how those CSRs are trained and compensated. If their current contact center is based on call time and resolution, I’d change it to proactive current customer contact and customer satisfaction. I’m also thinking that HD would generate more demand by making the checkout process more seamless and by making contractor billing systems more demand gen centered. When a contractor gets a bill from HD, it should invite him for workshops, free coffee for him and his crew, or product discounts.
--BtoB Relationships: Sure would help if one of HD’s major suppliers was visibly on its side right now. Maybe some product exclusives or very transparent end caps and signage would help get that done.
Any one of these factors would be a step in the right direction. I think demand gen needs to be a holistic process, not an event. Marketing, operations, employee engagements and BtoB relationships could all move toward the same goal. And maybe by focusing on demand gen a company like Home Depot could understand that the next quarter might be a wash. But the one after that doesn’t have to be.

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