Tue, Aug 1, 2006 19:53 EDT

Home Depot as an Online Advertiser?

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One of the most interesting trends that I am seeing is what I lovingly refer to as business model 'mashups.' First it was Amazon. Now it is Home Depot. Check out this article from Businessweek.com

Home Depot's Online Ad Play. The home-improvement retailer is breaking new ground by selling streaming video advertising online to vendors.

Home Depot's Online Ad Play

I think that you'll begin to see more of these ideas taking root, particularly amongst market leaders who have a specific asset or competence that they can leverage. In this case, while online video ads won't likely become a separate P&L business, the fact is that Home Depot enjoys a user base and a brand that advertisers simply want to be associated with, whether in-store or online. At the end of the day, advertising through Home Depot online is the offline equivalent of the 'end-cap' promotion in a grocery store. And with an attractive, highly targeted base of four million weekly online shoppers and six million email subscribers, that's alot of end-caps. The potential for Home Depot to cover its online operating costs and maybe even make some money through advertising revenue isn't a stretch. What I'd like to know is who they partnered with to run their advertising program...

As always, I'd love to hear what you think. Feel free to add your comments below.

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Fri, Aug 4, 2006 22:45 EDT

Yea

Posted by: bobfet1
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I don't really see this particular instance as a business model mashup because its essentially the same model the retail industry has been using for a long time - only now it has gone online. Companies already pay these retailers to feature their products or to use a fancy signage in-store, and to me this is essentially the same thing. It is more powerful here because companies can now really target the exact customers they want to reach.

I guess it depends on how it is being sold to determine how big of a departure it is from their traditional business model.

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