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H1 Media Opps: Lumber Liquidators reviewing marketing mix, continuing spend increases (Score 56)
Subject: digital, TV, social media, print, radio, PR
Company: Lumber Liquidators (LL), Toano, Va.-based retailer of discount pre-finished and unfinished hardwood flooring and other wood products with stores throughout the US.
In fact, by the end of 2016, LL will have replaced over half of its product assortment with "a fresh, contemporary line." This new assortment, said Dennis Knowles, has given the company the ability to "advertise broadly," which has driven changes in LL's brand marketing. When asked about LL's traditionally "extremely loud and visible, almost brash reach for value proposition," Knowles acknowledged that you'll see LL take a "somewhat softer approach in terms of the look and feel of marketing campaigns." This means continuing to position the company as a responsible retailer of flooring with the best knowledge of trends, styles, designs and innovations (think reputation versus promotion).
As far as advertising is concerned, LL continues to rebuild its brand from where it was in 2015. For Q3, SG&A expenses were up $12.5 million from the year prior - $3.5 million of which was from heavier advertising. Note, however, that during June, LL cut some advertising hoping they would have better closure rates in stores. He added: "As we rebound from the high turnover of last year...we do believe that we will have some ability to leverage our advertising spend. However, we are not quite there yet." And then new CFO Marty Agard added that LL is "likely" to keep spending up as ling as the company is convinced it's driving the topline.
During Q3, Presley said that installation services were "additive to sales" and he believes these services will help improve the LL brand and increase access to a wider consumer market. He pointed out that LL is not "fully deployed" in terms of installation, so CMO Marco Pescara and his team have "carefully" started to introduce installation into the overall marketing plan.
added marketing duties to his title last year. This, plus the addition of a new CEO and a focus on returning to profitability, places LL back on our Vulnerable Account Index.
Media Spend: Last year, LL spent $41.9 million on measured media last year – a drop from $53.8 million in 2014 (according to Kantar Media). Most of 2015′s spend was allocated to broadcast ads ($27.8 million) and the remainder went mostly to print ($7.8 million), radio ($3.4 million) and display ads ($1.7 million).
For the same period 2015, LL's TV spend was $17.4 million - 32% less than 2016. Keep in mind that this is also much more than the same period 2014 ($10.8 million).
Digital Breakdown: Per Pathmatics, LL has spent $1.9 million on desktop display ads (305 million impressions) and $1.8 million on online video ads (71.2 million impressions). An additional $141,000 has been spent on mobile ads (22 million impressions). See below for impression/site breakdown,
Desktop: Spend on desktop ads has spiked in the last month and most impressions were bought site direct (66%) or through Google AdX + AdSense (32%). Top desktop destinations include: doityourself.com and bobvila.com, as well as diynetwork.com and hgtv.com (Scripps Network Digital).
Online Video: Video spend was weighted heavily to Q1, dropped off for a while, and like desktop, has spiked again in the last month. Majority of these ads were placed site direct (93%). Top video destinations include: thisoldhouse.com (Time), youtube.com, cbssports.com (CBS), hulu.com (Comcast NBC Universal) and finance.yahoo.com.
Mobile: Most mobile ads were placed site direct (86%), but unlike desktop and video, have dropped off since May. Top mobile destinations include: hgtv.com, diynetwork.com, bobvila.com and doityourself.com.
Total digital spend (desktop, video and mobile) for the same period 2015 was $1.8 million.
Lumber Liquidators Holdings, Inc.
3000 John Deere Rd.
Toano, VA 23168
Chief Marketing & Merchandising Officer
Vice President & Director, Strategic Media – Eicoff
Senior Media Supervisor – Eicoff