We measured Home Depot foot traffic compared to one of its biggest competitors, Ace Hardware. See how these two big retail hardware brands stack up in different states throughout the U.S.
The Home Depot is a bellcow for the retail hardware industry -- on the same level as a Walmart, or McDonalds, in their respective verticals. Not coincidentally, each of these is a distinct category leader for retail foot traffic at physical stores. That’s certainly the case for Home Depot and it’s reflected in where they choose to locate.
Generally speaking, if there aren’t more than a few hundred thousand visits up for grabs in a given market, Home Depot probably isn’t interested in locating there. On the opposite end of the spectrum, Ace Hardware excels in smaller counties and cities, while struggling in larger urban environments, which are less loyal to the brand.
In the middle are a bunch of mid-sized markets where the big box leader takes on the helpful hardware man in some hotly contested battles. Let’s dive into historical foot traffic data to see how the retail hardware competition in these markets may be building in 2023.
In terms of total foot traffic nationwide, it’s not even close. Over Q1 of 2021 and 2022, Home Depot records about 4x as many weekly visitors on average vs. Ace Hardware. The only states Home Depot foot traffic loses head-to-head are sparsely populated Montana, North Dakota, South Dakota and Vermont, but’s Aces density of locations that wins the day, i.e. Home Depot still usually wins the major urban centers.
While it may not appear so at first glance, there are actually a number of smaller to mid-sized markets where the two brands compete that are meaningfully contested. We’ll drill deeper now with a look at a few of those.
Foot traffic battlegrounds
What allows Ace Hardware to carry the Green Mountain state is its success in Chittenden County VT and county seat, Burlington, the state’s largest city. Here, Ace Hardware defies Home Depot by taking 58% of foot traffic share. A closer look that some bordering New York state counties carry a similar competitive profile -- perhaps a chink in Home Depot’s northeastern armor.
Though Home Depot carries the state with a 4:1 ratio of Q1 foot traffic, Marin County CA (across the Golden Gate from San Francisco) are contested lands. Foot traffic between the two brands is almost exactly 50/50 here. One point for context in case you have not visited the area: when you think of Marin, don’t think cities. The largest on offer is San Rafael, a town of ~60,000 a ferry ride or a bridge away from downtown SFO or Oakland. Perhaps based on its roots here, Ace holds its own. How will a changing population affect that in 2023 and go-forward? That remains to be seen.
In the northwest of the Hoosier state you’ll find the de facto Chicago suburb of Lake County IN. The largest city, Crown Point, is about the same distance from the Windy City as Joliet IL. The area is a busy community, centrally situated, near major interstates and commuter routes. Where Marin County (above) feels like a town, this area feels like a city. Not surprising then that Home Depot comes out ahead, though it’s by less than 10%. Ace doesn’t normally have the ability to draw from a metropolis; that has something to do with their relative success here.
This last point brings up the importance of mentioning catchment areas, and each brand’s relative ability to draw visitors from greater distances.
A few words about catchment areas
All things are not equal when it comes to Ace Hardware’s and The Home Depot’s respective catchment areas. In a nutshell, Home Depot not only draws many more people on average than Ace Hardware, they also draw them from much farther away. This of course makes perfect sense vis-a-vis the two brands’ relative location strategies.
Ace Hardware specializes in serving smaller markets. You don’t have to go to the next town or county over to find an Ace Hardware, because your town probably has one. So, the trip to get there is shorter, meaning the brand’s catchment area is smaller. The challenge here is finding the balance between serving every small community and cannibalizing your individual store’s catchment areas.
Home Depot, on the other hand, makes people in smaller communities work to get to them, especially if they live off a busy route. People are sometimes willing to make that trip because Ace Hardware doesn’t have what they are looking for in their home market. It may also be convenient when making a bigger ‘run to the city’ for provisions or a day out. The challenge for Home Depot is ensuring they have overlap between their comparatively much larger catchment areas so as not to lose foot traffic to Ace Hardware that falls in the gaps.