Table of Contents
Overview
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- What you need to know
- Products covered in this Report
Executive Summary
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- The market
- Robust market growth in 2017
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- Figure 1: Consumer spending on the home, 2012-22
- Living and dining room furniture is a priority for shoppers
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- Figure 2: Consumer spend on the home, by segment, 2017 (est)
- The housing market has plateaued
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- Figure 3: UK Housing transactions, 2012-17
- Financial situation is weakened by concerns about the economy
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- Figure 4: How consumers describe their financial situation, January 2013-September 2017
- Smart connected devices pose new challenges for retailers
- The consumer
- Intentions for spending in 2018 similar to 2017, although furniture is down
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- Figure 5: Spending on the home in the last year, and intentions to spend on the home in the next year, October 2017
- High level of confidence about spending on the home
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- Figure 6: Confidence about spending on the home, October 2017
- Households spend to enhance enjoyment of their homes
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- Figure 7: Reasons for spending on the home, October 2017
- 21% will tighten their budget for the home in 2018
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- Figure 8: Intentions for spending more or less on the home in the next year, October 2017
- Range and quality must compete with special offers to attract shoppers
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- Figure 9: Factors influencing choice of retailer for major purchases, October 2017
- 72% take pride in their homes
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- Figure 10: Attitudes regarding the home, October 2017
- What we think
Issues and Insights
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- Will there be an ‘improve not move’ trend as economic uncertainty influences consumer confidence?
- The facts
- The implications
- Are consumers buying into smart home products?
- The facts
- The implications
- What impact is the rise in private renting having on demand for products for the home?
- The facts
- The implications
The Market – What You Need to Know
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- Spending on the home remained strong in 2017
- Flat market conditions ahead
- Market segmentation
- 1.3 million more households by 2022
- Patterns of home ownership are changing
- Owner-occupiers feel better off
- The housing market has plateaued
- Owner-occupiers most likely to have gardens
Market Size and Forecast
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- Robust market growth in 2017
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- Figure 11: Consumer spending on the home, 2012-22
- Market share growth will be an important strategy
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- Figure 12: Consumer spending on the home, 2012-22
- Forecast methodology
Market Segmentation
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- Market segmentation
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- Figure 13: Consumer spending on the home, by segment, 2017 (est)
- Living and bedroom furniture have been strongest
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- Figure 14: Consumer spending on the home, 2012-17
Market Drivers
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- 1.3 million more households by 2022
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- Figure 15: UK households, by size, 2012-22
- Patterns of home ownership are changing
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- Figure 16: Number of households in Great Britain, by tenure, 2011-15
- 30% of 25-34s are in privately rented property
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- Figure 17: Household tenure, by age group, 2017
- 23% of private renters moved in the last year
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- Figure 18: Length of time in current home, by tenure, October 2017
- Owner-occupiers feel better off
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- Figure 19: Household financial situation, by tenure, September 2017
- The housing market has plateaued
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- Figure 20: UK Housing transactions, 2012-17
- Easy to find second-hand items
- Surplus space at home creates opportunities for a wider range of interiors and usage
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- Figure 21: Usable floor area, by tenure, England, 2015
- The nation’s gardens
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- Figure 22: Presence of gardens, balconies and allotments, March 2017
- Consumer confidence weakened by concerns about the economy
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- Figure 23: How consumers describe their financial situation, January 2013-September 2017
- Interest rate rises cool demand for consumer debt
- Interest in the smart home is growing
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- Figure 24: Ownership of smart/connected devices, December 2016
- High level of interest shows that the market for smart home devices will take off
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- Figure 25: Interest in smart/connected devices, December 2016
Companies and Brands – What You Need to Know
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- Big changes in the DIY sector
- Trade-focused outlets growing strongly
- Intense competition among sofa retailers
- Omnichannel retailing works best
- High growth homewares retailers
- IKEA puts on a growth spurt
- The smart home market enters a new phase
- IKEA continues to innovate
- Help with visualising items in your own home will become a key battleground for retailers
Competitive Strategies
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- Big changes in the DIY sector
- Bunnings’ rollout begins in the UK as Homebase is realigned as a low-price DIY chain
- B&Q now every-day-fair price and repositioning the stores
- Wickes benefits from softer approach
- Trade-focused outlets growing strongly
- Intense competition among sofa retailers
- Fabb Sofas expands
- DFS will acquire Sofology
- Other sofa news
- Omnichannel retailing works best
- Retailers that began online are opening shops
- Amazon considering opening furniture shops
- High growth homewares retailers
- Dunelm is setting the pace
- Oak Furniture Land now over 90 outlets
- Wren Kitchens has boosted sales per outlet
- IKEA puts on a growth spurt
- Concentration of the garden sector
- Acquisition has driven growth of garden chains
- Importance of in-store restaurants and cafés
Launch Activity and Innovation
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- Home hubs evolve to add new skills, including those developed by third parties
- Amazon Echo was first on the scene
- Google launched its home hub in 2017
- Microsoft has developed its own personal assistant
- Retailers embrace the connected home
- Furniture retailers continue to innovate
- IKEA’s click-together furniture is simpler to assemble and move
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- Figure 26: IKEA’s wedge-dowel furniture, 2017
- IKEA considers furniture rental packages
- Help with visualising items in your own home will become a key battleground for retailers
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- Figure 27: Benchmarx, 3D image of kitchen plan, 2017
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- Figure 28: IKEA Place app, 2017
- A room that can automatically reconfigure itself
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- Figure 29: Ori, micro-apartment that automatically reconfigures, 2017
- Figure 30: John Lewis, furniture for small spaces, 2017
- Retailers embrace social media
The Consumer – What You Need to Know
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- 63% have spent on their homes
- Homeowners with a mortgage are a key shopper group
- High level of confidence about plans to spend
- Reasons for spending on the home
- Wide variety of reasons for spending on the home
- 21% will tighten their budget for the home in 2018
- Range and quality must compete with special offers to attract shoppers
- Stores remain relevant to shoppers
- Leisure time spent at home
Spending on the Home
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- Decorating and free-standing furniture top the list of purchases
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- Figure 31: Spending on the home in the last year, October 2017
- House moves influence demand for spending on the home
- Scottish households do the most decorating
- How important are private renters?
Intentions to Spend on the Home
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- 36% of households will do some decorating in 2018
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- Figure 32: Intentions to spend on the home in the next year, October 2017
- Intentions for spending in 2018 similar to 2017, although furniture is down
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- Figure 33: Spending on the home in the last year, and intentions to spend on the home in the next year, October 2017
Confidence about Spending on the Home
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- High level of confidence about spending on the home
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- Figure 34: Confidence about spending on the home, October 2017
Reasons for Spending on the Home
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- A combination of emotional and practical reasons drive demand for the home
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- Figure 35: Reasons for spending on the home, October 2017
- Replacement is a major driver of demand
- Home is a happy place
- Time to update the style
- Storage matters most to younger households
- The home as an investment
- Improving not moving is a factor behind some home spending
- More space please
Spending More or Less on the Home in the Next Year
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- 21% will tighten their budget for the home in 2018
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- Figure 36: Spending more or less on the home in the next year, October 2017
Factors Influencing Choice of Retailer for Major Purchases
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- Shoppers demand quality, range and price
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- Figure 37: Factors influencing choice of retailer for major purchases, October 2017
- Range and quality must compete with special offers to attract shoppers
- Omnichannel shopping is here to stay
- Broad appeal of interest free credit (IFC)
- Relevance of the specialist
- Planning services
Attitudes Regarding the Home
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- Today’s homes fulfil a wide range of functions
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- Figure 38: Attitudes regarding the home, October 2017
- Leisure time and watching TV at home is popular
- 72% take pride in their homes
- Meal time habits influence demand for furniture
- The kitchen is a home hub
- Younger people enjoy inviting friends into the kitchen
- Working from home places different demands on space
- DIY can be an engaging pastime
- Practical hobbies at home
- Gardening more popular as people age
Appendix – Data Sources, Abbreviations and Supporting Information
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- Abbreviations
- Consumer research methodology
Appendix – Market Size and Forecast
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- Forecast methodology
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