Inspiring A Lifetime of Possibilities For Your Home Presented to the Energy Star Participants May 11, 2005

2 Agenda Background Program Dynamics Retail Time Lines Financial Impact Communication & Marketing Conclusions Contact Information

3 Eco-Options

4 Background Eco-Options represents the external expression of The Home Depot’s market transformation strategy –FSC Certified Wood - source products from sustainable resources –Mow Down Pollution - lawnmower recycling program –Beat The Heat - energy conscious cooling –Energy Wise/Energy Smarts - reducing customer’s energy bills –Garden Smarts - environmentally friendly lawn & garden options Eco Options –makes buying products & taking on projects convenient and easy –allows the customer to take the environment into consideration –reduces/eliminates the sacrifices the consumer needs to make –provides a strong value proposition to the average consumer

5 Program Dynamics Keep it simple for both customers and retailers Incentive types –give away –instant rebate –gift card rebate –mail-in rebate –basket rebate Breadth of Retailers involved –exclusivity or channel managed Broad range of more environmentally friendly products increases customer touch points Event elements for in store promotion

6 Retail Time Lines Negotiating program elements –30 to 90 days Contract negotiations (lawyer time) –30 to 60 days Product procurement – days for domestic or import vendors –logistic challenges –forecasting demand for promotion contingency for exceeding expectations exit strategy of excess Advertising & promotional area planning cycle –how far out does retailer plan & what flexibility do they have to merchandise the product

7 Financial Impact Cost to vendor –marketing materials –funding the offers –event support through initial set-up & in-store demos –staging products & inventory risk Cost to retailer –marketing the program –administration of the program –inventory risk –front end financing until reimbursed –in store labour to stage & get product knowledge –disposal costs for trade-in events

8 Communication Initial communication to market place –press release - integrated PR plan –kick off with key players –internal to the retailer to staff up

9 Communication Initial communication to market place –press release - integrated PR plan –kick off with key players –internal to the retailer to staff up Marketing communication –in-store POP and flyers Permanent in store presence at shelf, at end aisle Training & consumer seminars key to successful execution

10 Communication Initial communication to market place –press release - integrated PR plan –kick off with key players –internal to the retailer to staff up Marketing communication –in-store POP and flyers –web & links to other environmental organization

11 Communication Initial communication to market place –press release - integrated PR plan –kick off with key players –internal to the retailer to staff up Marketing communication –in-store POP and flyers –web –print, TV and radio

12 Conclusion Keep it simple Respect timelines of retailer’s planning cycles Review and plan all costs up front Communicate internally & externally Sell a lot of Energy Star qualified products

13 Contacts Ian Cleghorn Divisional Product Merchant - Electrical The Home Depot Canada (416) Nick Cowling Public Relations Manager The Home Depot Canada (416)