Hammer time

Home Channel News, Sept 22, 2008

The hammer is the very symbol of home improvement retailing, and the entry point purchase for home improvement consumers. Not surprisingly, the demographic skews young. The latest consumer research from Port Washington, N.Y.-based NPD Group also shows a movement toward specialization in product attributes and a movement toward "closer-to-home" purchasing.

Analysis: The warehouse home centers dominate the category in both dollar share and unit share. Moreover, the warehouse home center channel is increasing its lead. All other channels, except for specialty stores, lost share in both charts, according to the data.

Still, its important to point out that nearly a quarter of all hammers are sold in the mass channel (24.9 percent). "Mass still has a good focus on entry level tools, and it's something they want to keep in their mix," said Mark Delaney, NPD Group's director of home improvement.

Analysis: The 18-34 group buys the most hammers by far. This demographic is more prevalent than average in the warehouse home centers (43.9 percent), and less prevalent in the hardware stores (42.5 percent).

Product attributes

Analysis: While still dominant, the basic claw/rip/framing hammer head lost share in 2008, revealing a trend toward specialization in hammer sales. All other types showed an increase in dollar share. Another clear trend was the movement toward wood handles, up 2.3 percentage points. Wood handles would seem to reflect a back-to-basics approach on the part of consumers.

The average price paid by consumers is $11.34, up from $10.46 in the same period last year. Not surprisingly, the mass channel averaged the lowest price point ($8.95), while the pro-oriented LBM supply stores averaged $15.26.

Purchase motivators

Analysis: Close to home rose 4.1 percentage points as a reason for shopping a specific retailer. Not surprising given the impact of gas prices on the consumer wallet. But once the customer is in the store, the concept of a "trusted brand" is gaining importance. Delaney offered three ideas: 1.) "First, hammers are still a low-priced category, 2.) It's a necessity. It's one of the first tools you'll ever need. 3.) It also benefits from the renewed focus on small projects."

Methodolgy NPD data is based on monthly tracking of nearly 70 categories, to 30,000 opt-in customers. The data above reflects the period July 2007 to June 2008.

CHANNEL BREAKDOWN BY AGE OF CONSUMER

Age      Total    WHC     Mass    Hardware    Dept. Store    LBM

18-34    43.9     44.7    43.5      42.5         46.7        58.1
35-44    21.7     22.0    22.9      18.6         15.3        28.0
45-54    19.8     18.9    19.8      23.5         21.7         3.8
55-64     8.7      7.9     9.8       6.1         11.2        10.1
65        5.8      6.5     4.0       9.3          5.1         0.0

Channel analysis

Dollar share by channel

                         2007    2008

Warehouse Home Center    46.4    48.9
Mass Merchant            20.8    19.7
Hardware Store           10.4    10.2
Dept. Store              10.5     8.1
Specialty Store           4.1     5.6
LBM Supply                2.4     2.2

Unit share by channel

                         2007    2008

Warehouse Home Center    39.4    43.0
Mass Merchant            25.5    24.9
Hardware Store           11.3    10.8
Dept. Store               8.6     7.2
Specialty Store           7.2     6.6
LBM Supply                1.8     1.6

Product attributes

Hammer type by dollar share

                   2007   2008

Claw/Rip/Framing   75.5   67.4
Ball Peen           7.5    9.3
Mallet              7.0    9.1
Other               5.2    7.6
Sledge              4.7    6.7

Handle type by dollar share

             2007   2008

Wood         35.5   37.8
Steel        25.6   23.9
Fiberglass   21.4   20.6
Graphite     12.3   12.2
Other         5.3    5.4

Purchase motivators

Reason retailer shopped by dollar share

                2007   2008

Price           36.5   37.9
Close to Home   27.1   23.0
Brand/Model     23.1   17.6
Availability    17.4   17.4

Reason for purchase by dollar share

                  2007   2008

Trusted Brand     28.4   32.2
Price             26.3   22.6
Feature           12.2   12.0
Promotion          7.2    8.2
Store Display      5.9    5.8
Warranty           3.5    5.3
Store Personnel    4.5    4.4