Home Depot's Focus on Omnichannel: Real Impact or Buzzword?

The Home Depot Inc. HD continues to steal the spotlight for its omnichannel strategy as a key lever for long-term growth, blending physical retail with digital convenience to serve evolving customer preferences.

In first-quarter fiscal 2025, more than 45% of online orders were fulfilled through stores, highlighting the retailer’s ongoing efforts to create seamless integration between its digital and physical ecosystems. The company emphasized improvements in app experience, search relevance and online checkout as part of the above-mentioned initiative.

While digital sales remain under pressure due to softness in larger project demand, Home Depot is doubling down on investments to elevate the customer journey across touchpoints. Enhanced delivery capabilities, a more frictionless returns experience and expanded Pro capabilities are all part of this omnichannel push. Notably, the company is advancing its “ecosystem of capabilities” for Pro customers, integrating digital tools, fulfillment, and personalized services to drive loyalty and productivity.

However, questions remain around how quickly these efforts will translate into measurable gains. Though store-enabled digital fulfillment is gaining traction, overall comp sales were down 2.8% in the fiscal first quarter, reflecting continued macro headwinds and soft DIY demand.

As Home Depot navigates a more challenging demand environment, its ability to drive tangible results from omnichannel upgrades, particularly in improving conversion and ticket size, will determine whether the strategy is truly transformative or simply aspirational.

Can LOW & WSM Match HD’s Omnichannel Muscle?

While Home Depot continues to strengthen its omnichannel platform, rivals like Lowe’s Companies Inc. LOW and Williams-Sonoma Inc. WSM are ramping up their digital and in-store integration efforts to stay competitive in a rapidly evolving retail landscape.

Lowe’s omnichannel strategy continues to gain traction, with more than 60% of online orders now fulfilled through stores, a sign of growing synergy between digital and physical retail. In first-quarter fiscal 2025, the company enhanced its mobile app, improved search functionality and streamlined checkout to elevate the customer experience. Lowe’s also expanded same-day delivery capabilities and deepened Pro personalization features, reinforcing its commitment to a seamless, efficient and integrated shopping journey across channels.

Williams-Sonoma’s omnichannel strategy remains a core growth engine, supported by its digital-first operating model and strong brand integration. In first-quarter fiscal 2025, the company posted a 3.4% comparable brand revenue increase, with all brands delivering positive comps, driven by cross-channel engagement. WSM continues to optimize inventory, expand its loyalty ecosystem and integrate e-commerce with physical stores. These initiatives are enabling efficient fulfillment and helping the company maintain strong margins and customer satisfaction across platforms.

The Zacks Rundown for HD

Home Depot’s shares have risen 3.8% in the past year compared with the industry’s growth of 1.8%.

From a valuation standpoint, HD trades at a forward price-to-earnings ratio of 23.66X, higher than the industry’s 21.47X. It has a VGM Score of B.

The Zacks Consensus Estimate for Home Depot’s fiscal 2025 earnings implies a year-over-year decline of 1.3%, while that for fiscal 2026 indicates growth of 9.2%. Earnings estimates for fiscal 2025 have been unchanged in the past 30 days.

HD currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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