Bunnings hammers away at building online store

Bunnings customers will be able to buy products such as hammers, nails and potting mix online within two years.

Australia’s largest home improvement retailer is preparing to launch a fully transactional online store and shift most of its product range online within 24 months, enabling shoppers to transact online and pick up orders from every Bunnings store. Home deliveries are likely to follow.

Bunnings is one of the last major retailers to develop a fully fledged e-commerce offer and is considered a bit of a digital laggard. However there is much happening behind the scenes.

Earlier this year Bunnings starting selling about 20,000 “special orders” including bulky goods such as sheds, childrens playgrounds, bathroom and kitchen products, turf and mature trees online. These products were previously only available by ordering at Bunnings’ special orders desk in-store.

Bunnings also expanded its online stock search function, enabling customers to compare prices and create wishlists.

Advertisement

​Bunnings managing director Mike Schneider indicated in June that the category killer, known for its wide range and low prices, was overcoming its previous resistance to e-commerce.

After previously ruling out a full online offer, Mr Schneider told investors in June: “We’re not seeing huge demand for a full click-and-collect offer but there’s no doubt in my mind that’s where we’ll end up.”

“That’s the reality of the world we live in now.”

Since then Bunnings has accelerated its investment in digital, data analytics and e-commerce, encouraged by the response to online special orders and Wesfarmers’ establishment of an advanced analytics centre in Melbourne earlier this year.

Bunnings has established a dedicated digital and data division run by group director digital and communications James Todd.

The retailer is using data analytics to better understand geographic and seasonal differences between markets in Australia and New Zealand and to fine tune its product range rather than adopt a cookie cutter approach.

It is also using data analytics to identify injury risks and assess skills and training needs amongst its 70,000 staff and to analyse customer feedback to improve its product range and services.

On the digital front, Bunnings is embracing Facebook to improve communication with staff and is introducing wearable devices supplied by Theatro – a US-based company which has pioneered voice-controlled mobile apps – to help team members communicate with each other and better serve customers.

Bunnings is also using digital platforms such as online tradies site Hi-Pages to expand its range of services.

After announcing a fixed price toilet installation service in conjunction with Hi-Pages in June, Bunnings is preparing to offer more services including fixed price installation for sink and basin mixers, ceiling fans and bathroom heat lamps.

Bunnings is also conducting a trial where customers will be able to obtain online quotes for services such as kitchen installation and house painting.

Bunnings has one of the largest online audiences amongst Australian retailers –  despite its limited e-commerce capacity – with 13 million visitors a month and traffic growing 20 per cent a year, according to a presentation at Wesfarmers’ strategy day in June.

Bunnings will account for about 55 per cent of Wesfarmers’ earnings and 65 per cent of its market value after Coles is spun off as a separately listed company in November.

After years of double-digit earnings growth and high single-digit sales growth, analysts and investors are querying how long the retailer can continue to take market share and deliver above-average returns.

However,  Mr Schneider told investors last month there were ample opportunities to grow faster than the market by widening Bunnings’ range, expanding services and deepening its engagement with customers and growing share in categories where it is currently underrepresented.

Read More

LEAVE A REPLY

Please enter your comment!
Please enter your name here