NEW BUSINESS PITCH

Let’s Build Something Together

NAME BRAND PITCH TYPE

Media

MARKET DATE

September 28 , 2016

The Data You Need to Win This Pitch

DESCRIPTIONHome improvement retail giant Lowe’s has launched its first media agency review in more than a decade. Creative is not part of the review, and sources

indicate that incumbent OMD may not defend. A Lowe’s spokesperson told Adweek:“As part of the normal course of business, we regularly review the agencies and vendors that support our company to evaluate our objectives against

performance and ensure we remain strategically aligned. As the consumer and media landscape continues to rapidly evolve, we are exploring the most compelling and efficient ways to reach consumers to help ensure we remain well positioned.”

Both OMD and BBDO declined to comment, though Lowe’s confirmed that the creative portion of its business was not affected. Sources tell us that OMD will not defend the account but that another Omnicom entity will most likely participate in the review, which remains in the RFI stage at this time.

International consultancy R3 is managing the process.

Lowe’s has launched its first media

agency review in more than a decade.

thNorth America

Lowe’s Companies, Inc. was founded in 1946, is based in Mooresville, North Carolina, and operates as a home improvement retailer. It offers products for home maintenance, repair, remodeling, and decorating. The company provides home improvement products in various categories, such as lumber and building materials, tools and hardware, appliances, fashion fixtures, rough plumbing and electrical, lawn and garden, seasonal living, paint, flooring, millwork, kitchens, outdoor power equipment, and home fashions. It also offers installation services through independent contractors in various product categories; extended protection plans; and in-warranty and out-of-warranty repair services.

The company sells its national brand-name merchandise and private branded products to homeowners, renters, and professional customers; and retail customers comprising individual homeowners and renters. As of January 29, 2016, it operated 1,857 home improvement and hardware stores in the United States, Canada, and Mexico. The company also sells its products through online sites comprising Lowes.com, Lowes.ca, and ATGstores.com, as well as through mobile applications.

FINANCIAL OVERVIEWCOMPANY BACKGROUND

2015 Net Sales (mil)

2016 Employees

Employee Growth Percent

Assets (mil)

Net Income Growth Percent

Sales Growth Percent

59,074

270,000

-

-

4.9%

-

Ms. Marci P. Grebstein

Chief Marketing Officer

Mr. Eric B. MagnusonConsumer Marketing

Manager

DECISION MAKERS by

marci.grebstein@lowes.com eric.b.magnuson@lowes.com

Client Profile / Market

MAIN COMPETITORS

Home Improvement in the U.S.

$318 BILLION

4.4%

- HIRI.com -

SALES IN 2015home improvement products

2016 FORECASTED GROWTH

- HIRI.com -

$ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $

of U.S. adults made some type of home improvement in the past 12 months.

53%

$ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $

of adults who did home improvements spent $1,000 or more.

56%

HIRI.com

HIRI.com

Boomers Still Leaders in Home Improvement

Baby Boomers

Gen Xers

Pre Boomers

Millennials

47.8%

34.3%

15.3%

2.6%

Home Improvement spending share by generation

- JCHS -

According to

Harvard’s Joint Centerfor Housing Studies

With the massive generation of Millennials overtaking the Baby Boomers in number, the home

improvement industry will grow

at a 3.5 percentage rate annually in the years ahead.

Fast Food industry in numbersHome Improvement in 2016

37.9%Home owners plannedto complete a Home

Improvement project in 2016

49.8%Plan to do all thework themselves

26.6%Plan to do split the work with a contractor

29.8%BATHROOM

28.6%OUTDOOR LANDSCAPING

25.9%KITCHEN

TOP AREAS IMPROVED

Lowe’s was ranked the

18th largest retailer globally in the

National Retail Federation’s 2014

Fast Food industry in numbersLowe’s Home Improvement

2015 NET SALES$59.074 BILLION

• • •

4.9%2015 NET SALES GROWTH

• • •

17% LOWE’S MARKET SHARE

• HOME IMPROVEMENT INDUSTRY •

24% HOME DEPOT’S MARKET SHARE

Lowe’s Retail

LOWE’S OWNS

1840 STORES

+4.6%

CUSTOMER SEGMENTATION

SAME-STORE SALES

RETAIL CUSTOMERS

70%

RETAIL CUSTOMERS ACCOUNT FOR ABOUT 70% OF LOWE’S SALES

DO-IT-YOURSELFCUSTOMERS

DO IT FOR MECUSTOMERS

THEPROFESSIONALS

Looking for products to complete projects for other

customers like interior designers and building

contractors

16 MILLIONCUSTOMER SERVED

857 MillionTRANSACTIONS

EACH WEEKIN US, CANADA & MEXICO

IN 2015

Fast Food industry in numbersLowe’s Revenue by Product Category

HOME FASHION, STORAGE & CLEANING 6%

ROUGH PLUMBING & ELECTRICAL 9%

FASHION ELECTRICAL 10%

HARDWARE 11%

LUMBER & BUILDING MATERIALS 12%

KITCHEN & APPLIANCES 14%

OTHER 1%OUTDOOR POWER EQUIPMENT 4%

MILLWORK 6%

FLOORING 6%

PAINT 6%

SEASONAL LIVING 7%

LAWN & GARDEN 8%

Source: Lowe’s Financials

Fast Food industry in numbersFocus on Technology

FIRST RETAILER IN SPACE

Lowe’s partnered with Made in Space to become the first retailer to launch a 3D printer into space. The printer allows astronauts to manufacture tools and parts on demand.

Customers are already using Lowe’s Innovation Labs’ 3D scanning and printing services to

produce custom or hard-to-find replacement parts.

HOLOROOM AND VIRTUAL REALITY

Lowe’s also implemented its Holoroom technology in select US stores. Holoroom enables Lowe’s customers to visualize the impact of potential home improvement projects in the kitchen and bathroom in virtual reality. The technology also allows the customer to make changes to the planned project in the Holoroom

The Holoroom is an improvement over the MyLowes feature on its web portal which

allows the customer to store room dimensions online and visualize the impact of design

changes.

Fast Food industry in numbersImproving Digital Presence

SNAPCHAT2015 Media Spending $769 Million

- Source: AccessConfidential.com -

LATEST CREATIVE “Jeff’s Story”

Type: Online Advertising

- Source: AccessConfidential.com -

FACEBOOK VIDEO

“In the past, we did lots of ‘how-to’ content that was informative and instructional. But this year, we want to have more inspiring content with a focus on digital and social to reach older millennials,” said Grebstein.

Marci P. GrebsteinChief Marketing Officer

FLIP-SIDE SERIES

Targets new homeowners

Since July, Lowe’s posts one “Made in a Minute” Facebook 360-degree video per month covering different do-it-yourself ideas aimed at attracting Millennial consumers.

360° Videos

The company used Snapchat to create a series of videos called “In a Snap” in May of this year,

where viewers can hammer, drill or chisel to complete a DIY project by tapping the right

place.

IN A SNAP SERIES

- Source: WSJ.com -

Short videos that simultaneously show what happens when a homeowner does and doesn’t do common household tasks

TOP SOURCES TOP SOURCES BY GENDER TOP DIY CONTENT

Fast Food industry in numbersDIY Inspirational Sources

59.1%Home Improvement

55.3%Home Decoration

42.0%Gardening

59.4%General Home Improvement /DIY Sites

40.7%Social MediaPlatforms

37.8%Retail /Commercial Sites

51.5% 25.3%

21.4% 8.3%

17.2% 35.5%

SOCIAL MEDIA

DECOR BLOGS

ONLINE VIDEO

- Source: Rhythmone.com - - Source: Rhythmone.com -- Source: Rhythmone.com -

DIY HOMEIMPROVERS

QUICK DEFINITION: DIY customers shop for products and supplies to complete

home projects by themselves.They often rely on blogs or magazines to find new ideas or ‘how-to’ guides to complete the projects they have in mind.

47%

10%

20%

0

30%

13-17

• • •

• • •

18-24 25-34 35-44 45-54 55-69

77%FEMALE

62%MARRIED

71%WITHOUT CHILDREN

HOME DECORATORS & DIYs

197.7 195.5

READERS

180.3

ART APPRECIATORS

161.2

PARTYGOERS

54%

DIYHOME IMPROVERS

Compare the DIY Home Improvers Demographicwith Lowe’s Female Audience

Lowe’s audience overlaps with our DIY

Home Improvers demographic by 54%

in interests, including: Home &

DIY, Art, Nightlife and Reading

LOWE’S HOME IMPROVEMENT AUDIENCE CROSSOVERS

Lowe’s Audience is highly interested in Home Decor and,

compared to DIY Home Improvers, are more engaged by

Household Supplies & Appliances (31.1%).

DIY Blogs are followed by 29.4% of Lowe’s audience while Home and Garden Magazines are read

by only 9% of them.

DIY HOME IMPROVERS:HOME DECOR & DIY

DIY BLOGS

33% POPULARITY

CLICK HERE TO SEE TOPHOME RELATED MAGAZINES

READ HOME & GARDENRELATED MAGAZINES

22%

CLICK HERE TO SEE TOP DIY BLOGS

LOWE’S HOME IMPROVEMENT AUDIENCE CROSSOVERS

DIY HOME IMPROVERS:ART

Art isn’t appreciated as much as DIY Home Improvers do.

The Art Appreciators trait scores 115.2 popularity points.

Therefore, Museums and Art Galleries gather less interest

(117.5).

ARTAPPRECIATORS

195.4

MUSEUMS &ART GALLERIES

191.4 American Visual ArtMuseum

KNOW MORE

FAVORITE MUSEUMS

DISCOVER THEIR FAVORITE ARTISTS

DISCOVER THEIR FAVORITE ART EVENTS

LOWE’S HOME IMPROVEMENT AUDIENCE CROSSOVERS

DIY HOME IMPROVERS:READING

Reading isn’t a hobby for Lowe’s audience, as

suggested by the under-indexing of the

readers trait (75.0)

However, gossip seem to attract some interest

among Lowe’s customers.They over-index as

Gossipers (123.4) and, like DIY Home Improvers, visit Gossip related websites

(140.3)

131.7BOOKWORMS

POETRY BOOKS157.4

GOSSIPWEBSITES165.5

TOP POETRY BOOK

KNOWMORE

DISCOVER THEIR FAVORITE WEBSITESLeaves

Of Grass

195.4GOSSIPERS

LOWE’S HOME IMPROVEMENT AUDIENCE CROSSOVERS

You’ll hardly meet a Lowe’s customer in a club.

The party goers trait scores 84.4 popularity points, while Nightlife is just below the average (97.0).

However, Lowe’s audience shows a good interest in Bars

(137.0)

DIY HOME IMPROVERS:PARTY

BARS160.3

CLUBS &DISCOS153.8

NIGHTLIFE161.2• • • • • •

DISCOVER THEIR FAVORITECLUBS

CLICK HERE TO SEE THEIR FAVORITE BARS

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