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Converting shoppers to customers still a challenge for Lowe's

More customers came to Lowe's Cos. Inc. stores during the company's fiscal fourth quarter, but the company is still struggling to get visitors to make purchases and struggling to compete with rival Home Depot Inc.

Richard Maltsbarger, COO at the Mooresville, N.C.-based home improvement retailer, said during a Feb. 28 call to discuss results for the quarter ended Jan. 31 that a larger marketing campaign during the quarter led to "robust traffic growth." Maltsbarger declined to share specific traffic numbers when asked by an analyst during the call.

Despite that boost, fewer visitors appeared to make purchases. The number of transactions for the quarter fell 7%, CFO Marshall Croom told analysts during the call.

"While we were pleased with our traffic growth, we are actively working to improve conversion and gross margin while better managing inventory," Maltsbarger said, adding that the company is providing new training to employees who interact with customers in an effort to turn visitors into buyers.

Getting customers to make purchases has "steadily been a challenge as we moved throughout" fiscal 2017, he added.

Atlanta-based Home Depot, by contrast, reported both higher customer traffic and higher conversion rates for its fiscal fourth quarter, which ended Jan. 28.

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That difference showed up in same-store sales figures each company reported for the equivalent quarters. During Lowe's fourth quarter, comparable-store sales rose 4.1%. At Home Depot, meanwhile, same-store sales for the company's fourth quarter gained 7.5%.

The retailer said separately that it has expanded its partnership with The Sherwin-Williams Co. Under the revised agreement, Lowe's will debut a new line of spray paint under the Krylon brand, as well as new paint, stain and applicator products, the retailer said in a separate Feb. 28 statement.

During the company's 2016 fiscal year, paint products generated about $4.05 billion, or 6% of all sales at the company, according to an SEC filing.