Table of Contents
Overview
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- What you need to know
- Key issues covered in this Report
- Products covered in this Report
Executive Summary
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- The Market
- Specialist spending falls sharply in 2019, with further trouble ahead
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- Figure 1: Forecast of total DIY/hardware specialist sector size (including VAT), adjusted for COVID-19, 2014-24
- Big-box stores could regain specialist share in the coming years
- DIY sheds still account for a third of all spending
- Online sales break £2 billion mark
- Impact of COVID-19 on DIY
- There will be opportunities amid this disruption, but total spending will fall
- The type of projects will change, while the appetite for DIY could grow
- Online retail will accelerate
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- Figure 2: Expected impact of COVID-19 on the DIY market, short, medium and long term, April 2020
- Companies and brands
- Homebase and Wickes recover growth to complement smaller specialists
- Non-specialists’ sales grow again
- Specialists continue to lose mass-market share
- The consumer
- B&Q remains the market leader
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- Figure 3: Where they shopped for DIY products, March 2019 and March 2020
- In-store remains the most popular channel of purchase
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- Figure 4: Where they shopped for DIY products, by in-store versus online, March 2020
- Price remains king
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- Figure 5: Key purchase drivers, March 2020
- Three quarters undertook home improvement projects in the past year
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- Figure 6: Recent home improvement projects, March 2020
- The majority of work is undertaken personally
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- Figure 7: Who carried out the work, March 2018 and March 2020
- Online is a great resource when planning a project, but the store remains crucial
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- Figure 8: Actions when planning a project, March 2020
- In-store is key for design inspiration
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- Figure 9: Source of Inspiration, March 2020
- Opportunities for specialists to re-engage younger consumers
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- Figure 10: Attitudes towards DIY retailing, March 2020
- What we think
The Impact of COVID-19 on DIY Retailing
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- Short, medium and long-term impact on the industry
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- Figure 11: Expected impact of COVID-19 on the DIY market, short, medium and long term, April 2020
- Short term
- Medium term
- Long term
- Opportunities and Threats
- Extended periods inside push home improvement up the agenda
- Opportunities in DIY as non-essential spending is redirected to the home…
- …but the type of home improvement projects will change
- The lockdown will redirect spend…
- …alongside the redirection of demand online
- Smaller specialists could suffer…
- …this could see leading specialists consolidate in 2020
- Housing market will slow
Impact on DIY retail specialists
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- COVID-19 will see double-digit sales loss for specialists in 2020
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- Figure 12: Forecast of total DIY/hardware specialist sector size (including VAT), adjusted for COVID-19, 2014-24
- Shifts in consumer behaviour
- A fundamental change in shopping behaviours
- A quarter of consumers expect to spend less on the home…
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- Figure 13: Changes in spending habits on home and gardening products, 16th April-21st May 2020
- …while 12% expect to spend more
- The sector could be buoyed by redirected spending
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- Figure 14: Consumers who expect to spend more on sector over the next month, 14th-21st May 2020
- How the crisis will impact key consumer segments
- Older consumers lead the shift in behaviour
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- Figure 15: Changes in shopping behaviour, by age, 14th-21st May 2020
- Expected spending on the home is driven by younger consumers
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- Figure 16: Consumers who expect to spend more on the home over the next month, by age, 14th-21st May 2020
- And homeowners with a mortgage
- but spending among less affluent consumers will drop disproportionately
- How a COVID-19 recession will reshape the market
- A renewed focus on value
- And a shift to repairs and upcycling
- But budgeting behaviours will gradually soften
- A new confidence and appetite for DIY
- DIY shed specialists could regain share after COVID-19
- How the shift online will reshape the market
- Social media is a crucial platform for engagement…
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- Figure 17: IKEA Instagram, May 2020
- …but DIY specialists must do more in the channel
- Greater integration of online and offline offerings
- Video conferencing to bring consumers in-store
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- Figure 18: Dixons Carphone, ShopLive, May 2020
- Virtual design services
- COVID-19: Market context
Issues and Insights
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- How specialists can re-engage consumers
- The facts
- The implications
- The opportunity for new store propositions
- The facts
- The implications
The Market – What You Need to Know
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- Specialist spending falls sharply in 2019, with further trouble ahead
- Big-box stores could regain specialist share in coming years
- Total consumer spending on DIY grows 2.8% in 2019
- DIY sheds still account for a third of all spending
- Online sales break £2 billion mark
Market Size and Forecast
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- Specialist spending falls sharply in 2019
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- Figure 19: Total DIY/hardware specialist sector size (including VAT), 2014-19
- COVID-19 will see specialists suffer further in 2020
- Before recovering in 2021
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- Figure 20: Forecast of total DIY/hardware specialist sector size (including VAT), adjusted for COVID-19, 2014-24
- Figure 21: Forecast of total DIY/hardware specialist sector size (including VAT), adjusted for COVID-19, 2014-24
- Pre-COVID-19 forecast reveals how the sector could have regained stability
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- Figure 22: Forecast of total DIY/hardware specialist sector size (including VAT), pre-COVID-19 forecast, 2014-24
- Figure 23: Forecast of total DIY/hardware specialist sector size (including VAT), pre-COVID-19 forecast, 2014-24
- Forecast methodology
Market Segmentation
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- Shed specialists lose further market share in 2019…
- …but the sector could recover sales growth by 2021
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- Figure 24: Shed/big-box specialists’ sector size (including VAT), 2014-24
- Smaller specialists’ sales fall despite strong growth at the top…
- …and they could suffer disproportionately from COVID-19
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- Figure 25: Other DIY/hardware stores segment (including VAT), 2014-24
- This segmentation could change after COVID-19
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- Figure 26: Estimated segmentation of DIY specialists (including VAT), 2014-24
Consumer Spending on DIY Products
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- Total consumer spending growth contrasts the decline of specialists
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- Figure 27: Consumer spending on DIY-related products, 2014-19
- Tools and equipment spearhead spending, as garden expenditure falls
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- Figure 28: Category breakdown of consumer spending on DIY-related products, 2016-19
- Mintel’s consumer spending market size
Channels of Distribution
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- DIY sheds still account for a third of all spending…
- …but other specialists drop share to non-specialists…
- …as online pureplay consolidates
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- Figure 29: DIY products, estimated channels of distribution, 2019
Online
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- Online sales break £2 billion mark
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- Figure 30: Estimated online DIY market size (ex VAT), 2016-19
- Non-specialists continue to lead online…
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- Figure 31: Estimated online sales, by leading retailers, 2016-19
- …but specialists wrestle back some market share
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- Figure 32: Estimated share of DIY sales, by specialist and non-specialist DIY retailers, 2016-19
Market Drivers
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- The housing market has stabilised in recent years, but huge uncertainty lies ahead
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- Figure 33: Quarterly UK residential property transactions, Q1 2015-Q1 2020
- A rising proportion of homeowners in England
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- Figure 34: English households, by tenure, 2012-18
- Consumer confidence picked up over the past year
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- Figure 35: Financial confidence index, January 2017-April 2020
- Home improvements pick up in 2019
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- Figure 36: Trends in home improvement work done in the last 3 months and plan to do in the next 3 months, April 2017-April 2020
Companies and Brands – What You Need to Know
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- Homebase and Wickes recover growth to complement smaller specialists
- Non-specialists’ sales grow again
- Specialists continue to lose mass-market share
- Wilko and B&Q lead the market as favourite brands
- Total advertising spend up 2.8% in 2019
- Specialists look to revamp their store offerings
Leading Specialists
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- New Kingfisher CEO tweaking ONE strategy in light of falling sales
- Strong focus on ‘do-it-for-me’ proposition driving Wickes Building Supplies sales
- Homebase showing signs of recovery
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- Figure 37: Leading DIY specialists’ sales, 2015-19
- Outlet numbers
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- Figure 38: Leading DIY specialists’ outlets, 2015-19
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- Figure 39: Leading DIY specialists’ sales per outlet, 2015-19
- Profit and margins
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- Figure 40: Leading DIY specialists’ operating profit, 2015-19
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- Figure 41: Leading DIY specialists’ operating profit margin, 2015-19
Leading Non-specialists
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- Non-specialists’ sales grow again
- Argos maintains J. Sainsbury’s lead…
- …but Amazon set to overtake it in 2020
- Discounter sales grow across the board
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- Figure 42: Leading non-specialists’ estimated DIY sales (excluding VAT), 2015-19
Market Share
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- B&Q boosts share despite sales loss…
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- Figure 43: Leading DIY retailers’ estimated share of all specialists’ sales, 2015-19
- …but specialists continue to lose mass-market share
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- Figure 44: Leading retailers’ estimated share of all DIY spending, 2015-19
Brand Research
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- Brand map
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- Figure 45: Attitudes towards and usage of selected brands, April 2020
- Key brand metrics
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- Figure 46: Key metrics for selected brands, April 2020
- Brand attitudes: B&Q has great customer service, Wilko offers good value
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- Figure 47: Attitudes, by brand, April 2020
- Brand personality: Wilko is perceived as fun
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- Figure 48: Brand personality – macro image, April 2020
- B&Q perceived as aspirational, Screwfix responsive and cutting edge
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- Figure 49: Brand personality – micro image, April 2020
- Brand analysis
- Wilko offers an excellent experience and is highly recommended
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- Figure 50: User profile of Wilko, April 2020
- B&Q has great customer service and is highly trusted
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- Figure 51: User profile of B&Q, April 2020
- Screwfix provides a great online service and is not expensive
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- Figure 52: User profile of Screwfix, April 2020
- Wickes least ‘favourite brand’
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- Figure 53: User profile of Wickes, April 2020
- Homebase overrated and expensive
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- Figure 54: User profile of Homebase, April 2020
Advertising and Marketing Activity
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- Total advertising spend up 2.8% year-on-year in 2019
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- Figure 55: Recorded above-the-line, online display and direct mail total advertising expenditure by UK DIY retailers, 2016-19
- B&Q by far and away the sector’s highest-spending advertiser
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- Figure 56: Leading UK DIY retailers’ recorded above-the-line, online display and direct mail total advertising expenditure, 2016-19
- Majority of advertising spend channelled through TV
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- Figure 57: Recorded above-the-line, online display and direct mail total advertising expenditure by UK DIY retailers, by media type, 2019
- Nielsen Ad Intel coverage
Innovation and Launch Activity
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- Tile Giant launches new store format
- Homebase’s more accessible smaller-format high street store concept
- Immersive bathroom shopping experience
- B&Q launches new kitchen buying experience
- Pop-up showroom
- Home décor industry disruptor
- John Lewis & Partners launches new in-store home interiors advice service
- Homebase giving consumers more reasons to visit its stores
- First-of-its-kind kitchen purchasing app
Homebase
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- What we think
- Soft end-focused concessions and expanded product kitchen and bathroom offer
- Small-format stores in high streets targeting renters rather than homeowners
- Unique decorative product range
- Improving the ecommerce shopping experience has boosted online sales
- Response to the COVID-19 pandemic
- Company background
- Company performance
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- Figure 58: Homebase: Group financial performance, 2015/16-2018/19
- Figure 59: Homebase: outlet data, 2015/16-2018/19
- Retail offering
Kingfisher Group
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- What we think
- Urban proximity store format rollout to make DIY shopping more convenient
- Performance of Castorama and Brico Dépôt in France a major disappointment
- New group ecommerce director to drive digital capability growth
- Refreshed kitchen offering
- Response to COVID-19 and a new contactless click-and-collect scheme
- Company background
- Company performance
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- Figure 60: Kingfisher Group: Group financial performance, 2015/16-2019/20
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- Figure 61: Kingfisher Group: outlet data, 2015/16-2019/20
- Retail offering
Travis Perkins (Wickes Building Supplies Ltd, Toolstation and Tile Giant)
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- What we think
- Service-enabled ‘do-it-for-me’ proposition driving Wickes Building Supplies sales
- Convenient multichannel proposition for trade customers and serious DIYers
- Converts branches to click-and-collect hubs during COVID-19 crisis
- Company background
- Company performance
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- Figure 62: Wickes Building Supplies Ltd, Toolstation and Tile Giant: Financial performance, 2015-19
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- Figure 63: Wickes Building Supplies Ltd, Toolstation and Tile Giant: outlet data, 2015-19
- Retail offering
The Consumer – What You Need to Know
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- B&Q remains the market leader
- In-store remains the most popular channel of purchase
- Price remains king
- Three quarters undertook home improvement projects in the past year
- The majority of work is undertaken personally
- Online is a great resource when planning a project, but the store remains crucial
- In-store is key for design inspiration
- Opportunities for specialists to re-engage younger consumers
Where They Shop
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- 77% of consumers bought DIY products in the past year
- B&Q extends its share as market leader
- Homebase loses further ground
- Smaller-format specialists grow
- Non-specialists make gains in an increasingly fragmented marketplace
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- Figure 64: Where they shopped for DIY products, March 2019 and March 2020
- Specialists must do more to appeal to women…
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- Figure 65: Where they shopped for DIY products, by gender, March 2020
- …to young consumers…
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- Figure 66: Where they shopped for DIY products, customer profile, March 2020
- …and to those who aren’t homeowners
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- Figure 67: Where they shopped for DIY products, by homeownership, March 2020
- Specialists are missing out on a core source of demand
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- Figure 68: Where they shopped for DIY products, by duration in current home, March 2020
In-store vs Online
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- In-store remains the most popular channel
- B&Q leads in both channels…
- …but specialists remain underdeveloped online
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- Figure 69: Where they shopped for DIY products, by in-store versus online, March 2020
- Online penetration grew over the past year
- Amazon makes the biggest gains
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- Figure 70: Where they shopped for DIY products online, March 2019 and March 2020
- This will change significantly in 2020 amid COVID-19
Key Purchase Drivers
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- Price remains king
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- Figure 71: Key purchase drivers, March 2020
- Price, convenience and quality are priorities among older shoppers
- Younger shoppers value ethics, experience and innovation
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- Figure 72: Key purchase drivers, customer profile, March 2020
- Non-specialist shoppers seek price, while DIY shed shoppers favour experience
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- Figure 73: Key purchase drivers, by where they shopped net, March 2020
Recent Home Improvement Projects
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- 73% of households undertook home improvement projects in the past year
- New movers spearhead home improvement projects
- Opportunity to target young house movers
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- Figure 74: Recent home improvement projects, by duration in current home, March 2020
- Lighter DIY projects lead activity
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- Figure 75: Recent home improvement projects, March 2020
- Nearly half of consumers undertook two or more projects in the past year
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- Figure 76: Repertoire of recent home improvement projects, March 2020
- These projects will change amid COVID-19 measures
Who Carried out the Work
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- The majority of work is undertaken personally
- A quarter hired a professional
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- Figure 77: Who carried out the work, March 2018 and March 2020
- This will change significantly in 2020, which could create a legacy moving forward
Actions when Planning a Project
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- Online is a great resource when planning a project…
- …but the store remains a crucial step
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- Figure 78: Actions when planning a project, March 2020
- Consumers will have to find a new normal under COVID-19…
- …which could drive the need for virtual/augmented reality technology
Source of Inspiration
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- Consumers still look in-store for design inspiration…
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- Figure 79: Source of inspiration, March 2020
- …but social media is unparalleled among young consumers
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- Figure 80: Source of inspiration, by age, March 2020
- Younger consumers browse multiple sources
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- Figure 81: Repertoire of source of inspiration, March 2020
Attitudes towards DIY Retailing
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- Growing interest in sustainability…
- …and smart technology offers opportunities for growth
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- Figure 82: Attitudes towards DIY retailing, March 2020
- How specialists can re-engage younger shoppers
- DIY as a form of detox
- Specialists should cater to DIY novices…
- …harnessing the one-stop home shop model…
- …more temporary home solutions…
- …and new store propositions
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- Figure 83: Attitudes towards DIY retailing, by age, March 2020
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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