ATLANTA - In early November, ServiceMaster President and CEO Jonathan Ward announced that the parent company of lawn care giant TruGreen-ChemLawn had brought in a new marketing team that was charged with the goal of finding new ways to bring in customers. “Their initial perspective is that we’ve been buying nontargeted and nonqualified lists regardless of phone numbers and zip codes," he acknowledged. "Essentially, we’ve been buying every phone number and dialing for dollars.”
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During that same conversation, Ward said the company was exploring opportunities available for retail distribution, and that exploration resulted in a quiet, yet potentially significant, announcement on Nov. 27 - consumers will now be able to purchase lawn care services when they walk into a Home Depot store.
The two companies plan to "test a range of residential maintenance and repair services such as landscaping and upholestry cleaning," according to an announcement from Home Depot. The services will be co-branded and offered through 30 Home Depot stores located in three cities, although the specific cities were not announced. Additional services to be offered during the four- to six-month-long test program include termite and pest control through ServiceMaster's Terminix brand, carpet cleaning and plumbing repair.
"Consumers will soon be able to confidently and conveniently purchase our high quality home services, all backed by industry-leading customer satisfaction guarantees, from the convenience of a Home Depot store," remarked Ward.
"An increasing number of our customers are asking us to handle their home-improvement projects and home-maintenance needs because they don't have the time or desire to take on these projects themselves," explained Robert Nardelli, chief executive for Home Depot.
The program will be promoted through the use of kiosks, signage, promotional activities and direct marketing to Home Depot customers, according to the companies.
In addition, ServiceMaster announced its third-quarter earnings. Its TruGreen segment continues to struggle, with revenue essentially flat for this year's third quarter against last year's third quarter and earnings for the quarter down 14 percent to $52 million, which was attributed primarily to higher labor costs.
For the first nine months of the year, the combination of TruGreen-ChemLawn and TruGreen LandCare landscape maintenance work has grown about 1 percent to $1.1 billion with operating income of $126 million, which is 14 percent off last year's mark. The company said lawn care and landscape revenue were up slightly, but operating margins were hurt this year in the TruGreen LandCare division by "increased sales, marketing and administratrive costs."
Now that the company exited the commercial landscape construction arena with the sale of that work to Environmental Industries, it will focus on "growing margins in the maintenance business through the implementation of plant and material purchasing programs, improved labor productivity and more effective leveraging of overheads," according to a release.