Lowe's CEO Marvin Ellison said the retailer had unique advantages that helped it weather the coronavirus pandemic in its early months: more stores in rural areas and a large base of do-it-yourself customers.
As the pandemic stretches on and Covid-19 cases spread beyond big cities, however, the home improvement retailer said it's seen the struggles of small businesses in rural areas. It's looked for new ways to serve and market to customers in a time of social distancing.
On Thursday, Lowe's pledged $25 million toward grants for small businesses in rural communities, including some home professionals and contractors who shop at its stores. It will also turn a few of its parking lots into drive-in movie theaters, an idea that may expand to more locations.
Lowe's Chief Brand and Marketing Officer Marisa Thalberg said like companies owned by minorities and women, rural businesses face certain challenges like limited access to capital and fewer nearby services.
"As we started recognizing where the [pandemic] impact was being felt, we just felt that there wasn't enough conversation around the impact in rural America," she said.
For the home improvement retailer, the pandemic struck at a time when it's trying to reboot its image, overhaul its website and ramp up its business among home professionals. Those efforts have become more complicated during a pandemic — yet Lowe's has seized upon the chance to introduce itself to new customers and woo back former ones as it remained open as an essential business.
Lowe's added curbside pickup to all of its stores. It launched a free video tool for virtual home visits in June to try to entice more plumbers, electricians and other home professionals to join its loyalty program. And it stepped up philanthropic efforts, including a previous $25 million commitment toward grants for minority-owned and women-owned businesses. It's now adding $5 million to that fund, bringing its total small business grant program to $55 million.
Retail was the largest sector to receive the first round of business grants, followed by construction and other services, such as barbershops, nail salons and dry cleaners, company spokeswoman Amy Allison said. She said the businesses covered a wide range from grocery stores and car dealers to plumbers and painters. Each business receives up to $20,000.
In May, when Lowe's first-quarter earnings were stronger than expected, Ellison said the retailer had been buoyed by a few factors. About 25% of its stores are in rural areas that weren't as hard hit as bigger cities in the early months of the pandemic. About 20% to 25% of its sales come from pros — less than Home Depot's 45%. And Ellison said many of its professional customers are "pickup truck pros" who operate small businesses that haven't been hurt as badly as some of the major companies.
Lowe's shares hit a 52-week high of $144.94 on Thursday. The stock is up about 19% so far this year.
Thalberg said the retailer is getting creative to reach customers. It will host drive-in movie screenings for families. A store in Charlotte, North Carolina, will screen "The Secret Life of Pets" and "The Pursuit of Happyness" this weekend. It will have a similar event in early August in Cornelia, Georgia.
The movies will be free, but Lowe's will accept donations to support relief efforts for local small business with the Local Initiatives Support Corp., a national nonprofit that's helping Lowe's distribute its business grants. The retailer will match the donations 2-to-1 ne up to $50,000.
Stores will be closed during the events, but each car of moviegoers will receive a Lowe's movie bucket with masks, hand sanitizer, sanitizing wipes, bottled water and snacks.