What do you associate with the Homebase brand? For me it’s uncertainty. Uncertain whether I should actually travel a bit further to a B&Q store than go to the local Homebase. Uncertain whether the DIY staple I require will be in-stock, uncertain whether Homebase actually are a DIY ‘Shed’ or something else.
Homebase is profitable but has not exactly thrived since Sainsbury divested of them for £929m 2000. They have recently been down-sizing by closing un-profitable stores. Sales declined by 15% in 2015. B&Q really owns DIY in the UK (literally, as the bought the URL DIY.com a long time ago). Homebase seems to sit in a dangerous no-mans’ land between DIY and home furnishing, uncertain of its place in either. This hasn’t deterred Australian retail group Wesfarmer purchasing Homebase for £345m.
Homebase stores will be re-branded as Bunnings Warehouses and is understood to be adopting the look of their leading chain of DIY stores in Australia. That will probably be the easy part. More difficult will be positioning the new brand against B&Q and more trade-like builders merchant brands like Wickes.
The DIY market has been a difficult one in recent times. Hit first by the financial recession, it is now subject to a second whammy – the decline in house sales. Renters are naturally less interested in DIY, and the DIY market looks set for ‘flat’ at least for the foreseeable future.
Wesfarmer are bound to be bullish about the future of their UK prize, and are already talking of expanding further in to Europe. But how will they position the Bunnings brand in the UK? Bunnings have an excellent reputation in Australia that seems to be akin to a somewhat better loved B&Q. Bunnings are loved for their product range, price and expertise – but are clearly positioned as a DIY Shed – as per B&Q in the UK.
Positioning Bunnings in the UK
Both B&Q and Wickes seem to have pursued a similar and apparently reasonably successful adjustment to their positioning over recent years. They have positioned themselves as the choice of Britain’s white van man - the jobbing builder and decorator. They have separate trade counters, allow trade accounts and have some trade-orientated products. This probably has a positive effect on their image “Well if the trade go there. . .” It also probably allows really serious DIY-ers to open a trade account and get some useful discounts.
I think that Wesfarmers have essentially two choices in positioning Bunnings in the UK DIY market. One: Be like B&Q only better. This would mean dropping the home furnishings pretentions and challenging the mainstream Sheds with hopefully an even better and certainly more imaginative range of DIY kit. They would no doubt train their staff to be as knowledgeable as they are in Australia. And B&Q and Wickes never exactly seem cheap to me – in fact their prices for what you might call ironmongery – nuts and bolts, screws, latches, hinges etc. are eye-watering, and certainly at least twice the price they are in my brilliant little local hardware store. So there is another opportunity for Buntings there – improve their image as offering real value.
The other brand positioning opportunity would be something of a development of Homebase’s existing positioning. I would judge that Homebase gets a higher percentage of female visits – and as such surely there is an opportunity for a more vibrant ‘homemakers’ positioning? i.e. eschew the ironmongery, bags of cement and drills for a focus on decorating, furnishing and the outdoors. We might not be able to live in the outdoors the way Australians do, and fewer people seem to have time for hard-core gardening these days, but surely there is an ‘outdoor living’ positioning for Bunnings here? One that considers the current trend for extending the time we can spend outdoors with deck patios and heaters, attractive, resilient and well-priced garden furniture, awnings and other ingenious articles that help make outdoor living possible in our inclement climate.
And being Australian – why wouldn’t they major on barbecues? I bought my last barbecue in Homebase. Why? Because they were the only place that still had a decent selection well in to the summer. We went to B&Q first and heard: “Barbecues? Well we had one in, but it’s not really the season now is it? They’ve all gone”. Please Bunnings – go for positioning number 2. We’ve got enough DIY Sheds in Blighty.
Posted 27 January 2016 by Chris Bullick