Depot boosts its omnichannel firepower

With sales of its online channel approaching $4 billion, the Home Depot is heavily engaged in making goods flow through that channel more smoothly.

In fact, the company’s common order management system, or COM, has been called the largest IT project in the history of the Atlanta-based retail giant. And during the recent Goldman Sachs Annual dotCommerce Day presentation, Kevin Hofmann, Home Depot’s senior VP and president – online, explained to investors how the retailer intends to flex its order management muscle.

 COM, he said, is an “inventory visibility platform” to oversee the millions of deliveries that take place through small delivery trucks, big delivery trucks, through direct fulfillment distribution centers and in-store-pick-up transactions. “The IT investments we are making are really to optimize that whole supply chain offering,” Hofmann said.

The COM will help identify the best fulfillment option for the customer and allow Home Depot to leverage its omnichannel options (or, in Home Depot jargon “interconnected fulfillment” options) in a more intricate and elegant way, he said.

The first consideration for investment in COM, Hofmann said, is customer experience. “We think there is absolutely cost of delivery, cost of transportation benefits,” he said. "But those are only after we solve for the customer experience.”

Other observations from Hofmann’s presentation:

• Buy-online, pick up in store is the retailer’s fastest growing e-commerce channel;

• The average ticket for e-commerce transactions are “considerably’ higher than the average ticket of physical store transactions; and

• One of the findings of Home Depot’s digital evolution is that ecommerce-related chat and e-mail is a great medium to exchange product information. “It’s something that’s growing very nicely for us,” Hofmann said.