Ace Hardware Sees ‘Connected Homes’ As New Business Opportunities

The Internet of Things (IoT) is encouraging retailers across categories to reimagine their customer engagement tactics, associate tools and even their in-store assortments.

Although brands like Rebecca Minkoff and UGG have connected devices and data to improve the in-store customer experience, retailers like Ace Hardware focus on selling connected devices and solutions from top manufacturers. But the retailer’s VP of Merchandising, Frank Carroll, sees the IoT trend from several perspectives.

“From the perspective of the typical hardware store, IoT is a wireless connectivity that enables machine-to-machine communication that revolutionizes the way in which consumers can control, manage and automate the many devices in or about the home,” Carroll said in an interview with Retail TouchPoints. “We would describe these devices as home automation.”


From a retail operations perspective, IoT will provide retailers with another weapon to reach customers beyond traditional media and social posts, Carroll added. “But from an even more global perspective, IoT has enormous potential to address the way security, safety, energy management, entertainment and convenience of interface in both consumer and commercial applications.”

Below, Carroll shares details regarding Ace Hardware’s current and future investments in IoT:

Retail TouchPoints (RTP): Do you see the IoT affecting the employee side or customer-facing side of your business more?

Carroll: While we recognize that IoT will impact the employee-facing side or our business at some point, Ace’s immediate focus is on the consumer product opportunity for our business. Manufacturers of basic hardware products are coming out with traditional hardware products in connected technologies that are supported and operated from various platforms. Our initial focus is on traditional hardware items like switches, outlets and fire alarms. These are categories that are traditionally purchased and shopped at hardware stores. We will support these items in both Wi-Fi and Bluetooth platforms.   

RTP: Can you share a few other examples?

Carroll: Basic hardware products such as: Lighting controls, thermostats, security cameras, door locks, garage door openers and carbon monoxide detectors, to name a few. A “Connected Home” end cap has been developed and launched in our stores to promote from the best hardware brands with the best user experience. We aligned with Bluetooth and Wi-Fi technology because it is available readily on 85% of cell phones, single application driven and requires no hub. We also have created training content for store associates so that they are knowledgeable and helpful as it relates to consumer interest in the “Connected Home.” Ace Hardware is and will remain open to the investment requirements of IoT developments for customer engagement, but we will remain focused on executing and selling home improvement products that are either Wi-Fi or Bluetooth enabled.

RTP: Why did Ace Hardware decide to invest in IoT? How do you believe it will impact your business over the next five years?

Carroll: We’ve seen the existence of the IoT on the commercial side for years for automated controls. The potential market opportunity for home automation is expected to hit 1.8 billion units in the next five years and will drive over $60 billion in sales this year alone. It is important for Ace Hardware to stay relevant with where technology development takes home automation products. These products have the potential to continue to drive retail profits from new consumer preferences for connected hardware products.

Like consumers who want new phones every few years, there is a whole new emerging group of products that are being offered to consumers who desire products that can be controlled through a phone application virtually at anytime from anywhere. The emergence of the multiple technologies and need for assistance in purchasing the right products is an opportunity for Ace Hardware to utilize our knowledgeable helpful associates.

RTP: Which tools and technologies do you believe will have the most profound impact on the future of IoT?

Carroll: For those of us serving the hardware/home improvement industry, lighting controls will dominate the potential sales opportunities. Lighting control in home automation will command only a slight premium over traditional products and when combined with LED bulb technology will have the added benefit driving energy savings as well. Whole house controls and home climate products will also play an important part in driving home automation sales.  




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