Case Study: Lowe's Employees "Got the Power"
August 15, 2008
A Circle of Excellence case study (Edited by Stacy Straczynski)
Company: Mooresville, NC-based Lowe's, one of the largest home improvement retailers in the U.S., has more than 70,000 retail store employees among their 700+ stores across the country. The majority of employees that work with retail customers are men and women in their teens and early 20's. The Lowe's staff that primarily deals with contractors are male, often retired seniors, who spent a lifetime in the construction, plumbing and other building trades.
Incentive Professional: Len Daykin, Don Jagoda Associates, Inc., Melville, NY
Challenge: Due to Lowe's diverse staff, the incentives chosen to motivate this work force must also be divers to cater to such a large audience. Lowe's needed to find a way to motivate its employees to proactively encourage consumers to sign up for the Lowe's Credit Card and generate targeted increases in consumer applications. The company also wanted to create a sense of team spirit among employees in each store to maximize employee performance overall.
Solution: In order to reinforce Lowe's overall campaign theme, "The Power of Pride," "You've Got the Power" was created to motivate store employees to ask customers to sign up for Lowe's Credit Cards, which are provided and managed by GE Capital. In-store posters, colorful signage and flyers were distributed to every employee to announce the program, and quarterly newsletters were distributed to each employee to keep interest high. In addition, there were a series of "fast faxes" sent to Lowe's store managers to encourage support of the credit card effort in a proactive manner.
The initial incentive used was cash, which appealed to the entire targeted audience. Employees were awarded two dollars for every completed Lowe's credit card application. After stores met their pre-determined goals in terms of number of applications completed, the cash bonus jumped to three dollars in the next quarter. Virtually every store employee participated in the program, earning the cash awards.
Merchandise incentives were also awarded to the top performing Lowe's store in each of the chain's 12 regions at the end of each quarter. These stores received a package with more than 30 incentives that included items such as 36-inch super flat TVs, 16-piece golf sets and Bose Wave Radios. The incentives were awarded in random drawings that were held at catered "Power Lunches" at the top-performing stores. The entire store staff was invited to the luncheon and had the opportunity to win.
In addition to the top performing stores in each region, a "Wild Card" store was chosen from among the stores that reached or exceeded their pre-set goals to receive the same merchandise assortment for the in-store random drawings. This kept all the stores in the game, no matter where they ranked in relation to their competitors. At the end of the program, a Grand Prize "Power Lunch" was held for the stores in each region that achieved the highest total of applications over goals. A special assortment of awards was given out at an off-site banquet facility. Many of the prizes involved power accessories and electronics reinforcing the program theme: You've Got the Power.
Results: You've Got the Power successfully combined the power of merchandise incentives and cash to motivate a diverse workforce. Virtually every Lowe's employee participated in the program. The Store sweepstakes reinforced team spirit, as evidenced by the fact that over 67 percent of the Lowe's stores hit or exceeded their goals for the entire program. In some cases, individual stores exceeded their pre-set goals by 200-300 percent.
The "You've Got the Power" case study is a product of IMA's Circle of Excellence Award program. It was the third and most successful employee initiative in a series designed to build credit card application growth. The promotion was improved each time based on lessons learned and ongoing dialogues with Lowe's regional managers and GE Capital personnel. For more information, visit www.lowes.com.
The Incentive Marketing Association (IMA) is the leading voice of suppliers in the incentive marketplace. IMA provides education and information services, publications, conferences and seminars, and research to businesses to help them effectively use incentive programs to motivate employees and customers. More information about IMA and the incentive marketplace is available at www.incentivemarketing.org www.incentivemarketing.org.
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