Exploring the performance of home improvement and decor segments in the initial months of 2024, we analyzed major players such as Home Depot, Lowe’s, Tractor Supply Co., Harbor Freight Tools, Homesense, HomeGoods, and At Home. This examination aimed to shed light on their performance trajectory for the remainder of the year.
Key Insights
Comparing the first quarter of 2024 with the previous year, adverse weather conditions in January likely influenced year-over-year (YoY) quarterly comparisons for all the analyzed chains.
During Q1 2024, YoY visits The Home Depot and Lowe’s experienced declines of 1.1% and 4.0%, respectively. However, both chains observed a narrowing of visit gaps as the quarter progressed.
Tractor Supply Co. and Harbor Freight Tools exhibited robust performance in Q1 2024, registering respective quarterly visit increases of 4.8% and 10.1%, partly attributed to the expansion of their store networks.
Homesense, amid rapid expansion, concluded Q1 2024 with an impressive YoY visit growth of 9.9%, while HomeGoods and At Home maintained stability with minor quarterly visit gaps of 1.6% and 1.8%, respectively.
Navigating the Landscape for Major Home Improvement Chains
Following a challenging year marked by restrained consumer spending, signs of recovery emerged in Q1 2024. Lowe’s witnessed a gradual reduction in monthly visit gaps throughout the quarter, culminating in the first YoY visit increase since 2021 in April 2024. Similarly, although The Home Depot experienced a marginal decline in visits in February 2024, visits rebounded by 1.0% in March. Despite a slight visit gap reemerging in April, The Home Depot appears poised for a stable performance as the spring season unfolds.
While The Home Depot and Lowe’s show signs of rebounding, other home improvement chains such as Harbor Freight Tools and Tractor Supply Co. thrived by expanding into new markets, thus avoiding some of the challenges faced by the sector.
Embracing More Decor
The home decor segment, represented by brands like Homesense, HomeGoods, and At Home, continued to attract consumers seeking to enhance living spaces without committing to costly renovations. Despite surpassing strong performance in 2023, Homesense sustained YoY visit growth throughout Q1 2024. Inclement weather impacted HomeGoods’ and At Home’s January performance; however, both brands witnessed visit increases or stability in February and March. In April 2024, all three chains maintained steady performance despite minor YoY visit gaps, a notable achievement considering the discretionary nature of the category.
Home Decor: Targeting Affluent Consumers
A deeper examination of visitors to Homesense, HomeGoods, and At Home reveals a trend of affluent consumers driving visits to these chains. Each chain’s captured market boasts a median household income (HHI) close to or above the nationwide median of $76.1K/year. Notably, the median HHI of each chain’s captured market exceeds the national median, indicating that the wealthiest consumer segments in their respective trade areas are the primary visitors.
Final Reflections
The home improvement and decor sectors have experienced fluctuations in recent years, from the highs of the pandemic to the challenges posed by inflation. While some players thrived in Q1 2024, others navigated headwinds while maintaining stability. As 2024 progresses, the trajectory of these sectors remains uncertain. Stay tuned with MapZot.ai to discover the future of this dynamic industry.
