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Lowe's Reveals New Agencies as It Shifts Marketing Model

By Published on .

Lowe's sends a surprise to new agencies.
Lowe's sends a surprise to new agencies. Credit: Lowe's

Lowe's is renovating its agency structure, moving from an agency of record to a roster of shops for projects. In order to better focus its marketing messaging, the home improvement retailer has recruited the Via Agency, based in Portland, Maine, EP & Co., formerly Erwin Penland, based in Greenville, South Carolina and Conill, out of Los Angeles.

Evolving its model should help Lowe's become as relevant as possible with as many customers as possible, says Jocelyn Wong, who was promoted to chief marketing officer of the company last year.

"We serve a broad customer base across all income levels, genders and race," says Wong, who also noted home ownership as criteria. "We needed to make sure our agency model could be as agile as we needed it to be, as diverse as we needed it to be."

The Mooresville, North Carolina chain had worked with BBDO New York exclusively since 2005; Lowe's issued a request for information as part of its agency review in early December and stopped working with BBDO at the end of January. The new agencies will be on retainer with Lowe's. Each will be given projects and will have the opportunity to pitch for other projects in jump-ball situations, according to Derrick Wood, VP of brand content and advertising at the chain.

"Retail is not predictable, so it's hard to put a predictable agency model on something that's so variable," he says.

The three agencies were informed of their selection on Thursday in surprising fashion. Each received a custom-made "Welcome" crate openable remotely by Lowe's through smart-home technology. When the agency employee rang a doorbell on the crate, it alerted Lowe's, which opened the box. Inside, agencies found a confetti canon, bottle of champagne and Roomba vacuum (to clean up the confetti).

Lowe's, which spent around $387.9 million on measured media in the U.S. in 2016, according to Ad Age's Datacenter, reported fourth-quarter earnings earlier this week. While comparable sales were up 4 percent for the period, revenue fell 2 percent over the year-earlier period to $15.5 billion and net income fell. By comparison, Home Depot's comparable sales for the quarter were up 7.5 percent.

The new creative work should debut by the second quarter of the year. Much of Lowe's focus will continue to be on digital messaging. The chain invests roughly 42 percent of its marketing budget in digital channels, compared with just 17 percent four years ago, according to Wong. Last year, Lowe's appointed a new media agency in Starcom.

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