Lowe’s, like several of its competitors in the home improvement retail space, has struggled with weak consumer demand as a big question mark hovers over the U.S. housing market. 

In its latest earnings report, Lowe’s revealed that its comparable sales only increased by 0.4% year over year during the third quarter of 2025. Additionally, recent data from Placer.ai found that foot traffic in Lowe’s stores decreased by 0.1% during the quarter compared to the same time period in 2024.

The company’s top competitor, Home Depot, also experienced a 0.4% decrease in foot traffic at its stores during the quarter, as its sales rose by only 0.1% year over year. Wayfair, which sells home decor and furniture, even revealed in its most recent earnings report that the number of active customers on its platform during the quarter fell by 2.3%. 

Lowe’s CEO Marvin Ellison highlighted during an earnings call in November that affordability concerns and high interest rates in the housing market are causing home retail consumers to pull back their spending.

“Affordability and uncertainty in the broader economy continue to weigh on consumer confidence, particularly when it comes to larger discretionary purchases, as borrowing costs have been elevated for longer than originally anticipated,” said Ellison.

The average 30-year mortgage rate in the U.S. has remained above 6% since 2022, prompting many consumers to hit pause on new home purchases. Despite recent challenges, the U.S. housing market is slowly improving as interest rates have dropped over the past few months.

Lowe’s stores suffered a slight decrease in foot traffic during the third quarter of 2025.

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How the U.S. housing market performed in November 2025:

  • The average 30-year fixed-rate mortgage in November was 6.24%, down from 6.25% in October.
  • Existing-home sales increased by 0.5% month over month. 
  • Month-over-month U.S. home sales rose in the Northeast and South, but remained flat in the West and declined in the Midwest.
    Sources: National Association of Realtors, Freddie Mac

“Existing-home sales increased for the third straight month due to lower mortgage rates this autumn,” said NAR Chief Economist Lawrence Yun in a press release. “However, inventory growth is beginning to stall. With distressed property sales at historic lows and housing wealth at an all-time high, homeowners are in no rush to list their properties during the winter months.”

“Wage growth is outpacing home price gains, which improves housing affordability,” Yun added. “Still, future affordability could be hampered if housing supply fails to keep pace with demand.” 

Lowe’s unveils another round of free offers amid sales slump

In response to changing consumer behavior, Lowe’s has recently launched free offers for its customers, specifically MyLowe’s Rewards members, over the past few months to help boost demand in its stores.

For example, during Black Friday, it gave away free Lowe’s buckets full of products worth up to $100 to the first 50 MyLowe’s Rewards members who entered their stores at 6 a.m., along with a chance to win a home appliance worth up to $2,000.

Then the retailer gave away free holiday mugs to the first 200 rewards members who entered stores on Dec. 13.

Now, Lowe’s is rolling out another round of freebies to celebrate MyLowe’s Rewards Member Week, which starts on Jan. 10.

Related: Lowe’s announces free offer for customers amid struggles

Customers who are part of its rewards program, which is free to join, can receive free prizes such as $5 in MyLowe’s money or 20% off a purchase of up to $100 when they enter stores on Jan. 10, starting at 10 a.m., according to a recent post on Lowe’s Facebook page. 

Kids can also receive free gifts such as a key chain, crayons, a coloring book, or a mini blue hard hat that says “MyLowe’s Rewards Kids Club.” 

It is important to note that these offers can only be obtained in-store and in limited quantities. They are also available while supplies last.

The move from Lowe’s comes after Ellison said during the earnings call in November that the company’s rewards program is boosting spending in its stores. 

“We’re leveraging our loyalty ecosystem to increase our customer preferences for Lowe’s, so they choose us first and shop more often,” said Ellison. “In fact, our 30 million Milo’s Rewards members shop twice as often and spend over 50% more than nonmembers.”

Lowe’s is mirroring a growing retail trend

Lowe’s isn’t the only retailer leveraging freebies to help fix low sales. In 2024, Target, which has struggled with sales over the past few years, began offering freebies and exclusive discounts to Target Circle 360 members on the first of every month. 

It also offered customers a complimentary “swag bag” on Black Friday last year, which contained free items.

Last year, T-Mobile, which has focused on slowing down fleeing phone customers, offered customers $900 worth of freebies, giveaways, and perks through its T-Mobile Tuesdays program and recently promised to ramp up its free offers in 2026. 

More Retail:

  • Marshalls makes bold change to return policy ahead of holidays
  • Lululemon struggles to reverse concerning customer behavior
  • Kroger adds generous offer for customers as grocery prices rise

In a statement to TheStreet, RTMNexus CEO Dominick Miserandino said that heavily relying on free offers to shore up sales can backfire for a company. 

“From my experience advising retailers, leaning too heavily on discounts in a weak economy can become a race to the bottom,” said Miserandino. “Promotions might bring customers in, but without delivering real value, they rarely solve deeper sales challenges.”

The U.S. economy has been struggling with low consumer sentiment, as tariffs threaten to raise prices for goods and services nationwide. In response to economic pressures, many Americans have been spending less and seeking more value, according to a recent survey from Wunderkind. 

How U.S. consumers are battling tariffs in 2025:

  • Amid tariffs and inflation, 59% of consumers feel cautious, pessimistic, or panicked about the economy.
  • Approximately 71% cited higher prices as their top concern, while 47% cited unpredictable price increases. 
  • Also, 38% are seeking deals more often, while 34% are spending less overall.
    Source: Wunderkind

“U.S. shoppers are proving more strategic than ever,” wrote Danny O’Reilly, senior content architect at Wunderkind, in a blog post.

“What began as short-term caution has now crystallized into a new retail reality: value is the priority, trust is the differentiator, and digital fluency defines how, and where consumers spend,” he added.

Related: Lululemon struggles to reverse concerning customer behavior