A Retail Week survey predicted a busy 2015 Easter weekend for DIY retailers; the survey, conducted by ICM, concluded that 67 percent of respondents planned to do home improvements this year, an increase of 8 percent from last year.
2014 started to show signs of recovery for the DIY retailers, following the economic downturn and poor weather that hit retailers hard in the past few years. B&Q UK and Ireland witnessed a sales rise by 1.9 percent in the full year ending 31 January 2015.
The signs of recovery follow a run of disappointing sales which led B&Q and Homebase to announce the closure of a number of stores. Homebase announced it would close 25 percent of its stores over the next three years. John Walden, CEO Home Retail Group said the closures would position Homebase “as a smaller but stronger business, ready for investment and growth”. In March 2015, B&Q also announced 60 store closures across the UK and Ireland over the next two years, citing similar reasons, concluding that fewer stores would increase productivity.
The Retail Week survey proved correct as footfall at retail parks increased by 1.2 percent across Good Friday, Easter Saturday and Easter Monday compared to last year; this is likely to have translated to increased sales for bricks and mortar DIY retailers.
Brand View has reviewed pricing and promotion of hundreds of paint, wallpaper, lawn mower and grass trimmer products in the run up to Easter Weekend in five UK retailers.
The average promoted price of hundreds of paint and wallpaper products
We have indexed the average promoted price of the paint and wallpaper products analysed in Argos, B&Q, Homebase and Tesco before and during the Easter weekend.
By indexing the average promoted price per retailer we can track the changes in promoted pricing over a selected time period. When the price index falls below 100 on the graph below this indicates that the average promoted price of the retailer has fallen since 1 February 2015.
Homebase and Tesco Direct dropped their average promoted price significantly in the run up to the Easter weekend, while Argos and B&Q favoured a gradual reduction across the period analysed.
The average promoted price at Homebase increased by 2.3 percent on 26 March before reducing by 27.3 percent the next day, exactly a week before Good Friday.
Tesco Direct made its move at the start of the Easter weekend dropping its average promoted price by 24.6 percent on Good Friday (3 April).
Promotional activity for paint and wallpaper products reviewed
The increase in promotional activity of Homebase and Tesco Direct correlates with the reduction in average promoted pricing shown above.
Argos showed a significant increase in promotional activity on 26 March. However, the average promoted pricing analysis shows only a small decrease in Argos’s average promoted price; this suggests the promotions they introduced had a low depth of cut.
Homebase and B&Q had a similar percentage of their paint and wallpaper range on promotion for the first two months of the period analysed. Homebase drastically increased its number of promotions on 27 March starting a 3 for 2 promotion on the majority of its paint range.
The number of Homebase promotions drop off significantly on 31 March as the 3 for 2 promotion ends, however we only see a slight increase in average promoted price. Looking into the data we see that following the 3 for 2 promotion, Homebase put 75 of its Own Label paint lines on a Buy 1 Get 1 Free deal which kept the average promoted price down.
Average depth of cut on paint and wallpaper promotions
Reviewing the average depth of cut of the paint and wallpaper promotions confirms that the increase in promotional activity by Argos on 26 March was on a lower average depth of cut than it was offering previously, therefore only a small reduction was seen on the average promoted price chart.
In spite of the increase of promotional activity by Homebase and Tesco Direct in the run up to the Easter weekend, we see that B&Q had the greatest depth of cut for the entire period analysed peaking at 43.6 percent – more than 10 percent higher than the other retailers.
Percentage range on promotion: Lawnmowers and Grass Trimmers
The forecasts of a warm Easter weekend may have motivated people to work in their gardens over the weekend, inspiring purchases of new garden equipment such as lawnmowers and grass trimmers/edgers.
Reviewing the promotional activity of the four retailers for lawnmowers and grass trimmers/edgers shows that Argos promoted the greatest percentage of its range (57.8 percent) over the Easter weekend.
Tesco Direct also boosted promotional activity from 0 promotions on 8 March to 12.4 percent over the Easter weekend.
B&Q and Homebase showed no significant change in the percentage of its range on promotion over the Easter weekend.
Homebase has since increased promotions to 24.4 percent of its lawnmowers and grass trimmers/edgers on 10 April, presumably in response to continuing forecasts of good weather in April.
The average depth of cut of lawnmower and trimmer category
As with the previous category, B&Q also had the greatest depth of cut for the majority of the period analysed for lawnmowers and trimmers.
For two weeks in early February, Tesco Direct ran a 50 percent promotion on its Own Label 1400W electric rotary lawnmower.
The promotions introduced by Homebase on 10 April have increased its average depth of cut to 17.6 percent however this is still more than 10 percent lower than B&Q were offering.
B&Q consistently had the greatest average depth of cut of any of the retailers across both categories, although they did not seem to heavily promote over the Easter weekend. Tesco Direct actively increased the number of promotions across both categories in the run up to Easter weekend to capture customer interest.
Homebase ran promotions including a 3 for 2 deal on paints and a 17 percent increase in depth of cut for lawnmowers, however, its promotions did not specifically coincide with Easter weekend.