Table of Contents
Executive Summary
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- The issues
- Furniture market outlook appears promising
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- Figure 1: US consumer expenditures and fan chart forecast for furniture, at current prices, 2011-21
- Everyone wants a bigger piece of this highly fragmented category; leads to continual price promotion
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- Figure 2: Home furnishings retailers and general merchandisers shopped for furniture, April 2016
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- Figure 3: Other channels shopped for home furnishings, April 2016
- Growth is coming from online, but many averse to trying it
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- Figure 4: Method of purchasing, April 2016
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- Figure 5: Attitudes toward buying furniture online, April 2016
- The opportunities
- Focus on the young affluents, and don’t forget the men
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- Figure 6: Timing of last purchase – Within the last two years, by key demographics, April 2016
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- Figure 7: Method of purchasing, by select demographics, April 2016
- Build the brand; reputation matters
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- Figure 8: Reasons for choosing furniture retailer, April 2016
- Be at the point of influence
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- Figure 9: Furniture Influencers, April 2016
- What it means
The Market – What You Need to Know
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- Furniture market on the upswing
- More households mean more space that needs furnishing
- Housing market still trying to make a comeback
Market Size and Forecast
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- Market continues on a steady path of growth
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- Figure 10: US consumer expenditures and fan chart forecast for furniture, at current prices, 2011-21
- Figure 11: US consumer expenditures for furniture, at current prices, 2011-21
Market Breakdown
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- Category marked by fragmentation
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- Figure 12: US consumer expenditures for furniture, by type, at current prices, 2015
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- Figure 13: US consumer expenditures for furniture through furniture stores and other retailers, at current prices, 2011-16
- Figure 14: Top 10 US furniture retailers per Furniture/Today, 2015
Market Factors
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- Confidence levels high despite signs of slowing momentum
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- Figure 15: Consumer confidence and unemployment, 2007-April 2016
- Multigenerational living on the rise
- More homes, more space but less people per home
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- Figure 16: US households, 2005-2015
- Median household income on the decline
- Housing market shows signs of improvement, but younger consumers still opting out
- Trend toward renting over owning
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- Figure 17: US households by tenure, race and Hispanic Origin, 2005-14
- Minimization is a growing trend
Key Players – What You Need to Know
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- Bedding specialists should be sleeping well
- Rental segment remains a small part of the total market
- Virtual and augmented reality will change how people shop for furniture
What’s Working?
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- Bedding specialists have a reason to sleep well
- Technology comes to the market
- Bed-in-a-box options find loyal fans
- Companies seek endorsement from athletic icons and organizations
What’s Struggling?
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- Rental furniture retailers not a main threat
- In their words
What’s Next?
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- Virtual and augmented reality technology set to disrupt
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- Figure 18: Wayfairview product demonstration, June 2016
The Consumer – What You Need to Know
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- Key buyers skew young, male and more upscale
- Most purchases for the living room and bedroom
- Do I need it or do I just want it?
- Home furnishings stores reign, but they better watch out
- Growth is coming from online
Timing of Last Purchase
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- Over half of consumers purchased furniture recently
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- Figure 19: Timing of last purchase - furniture, April 2016
- Younger affluents reign as key buyers
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- Figure 20: Timing of last purchase – Within the last two years, by key demographics, April 2016
- Homeownership and household size make a difference
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- Figure 21: Timing of last purchase – Within the last two years, by primary residence and household size, April 2016
Consumer Segmentation
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- Value Shoppers (VS)
- Brand Name Shoppers (BNS)
- Potential Online Shoppers (POS)
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- Figure 22: Consumer segmentation custom groups, by select demographics, April 2016
Types of Furniture Purchased
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- Purchases align with rooms where most at-home time is spent
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- Figure 23: Types of furniture purchased, April 2016
- Always a buyer in the market
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- Figure 24: Types of furniture purchased, by custom groups, April 2016
- Purchase drivers likely to vary between homeowners and renters
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- Figure 25: Types of furniture purchased, by primary residence, April 2016
- Everybody needs a mattress
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- Figure 26: Household furnishings purchased, February 2015 – March 2016
- Spending is highest for mattresses and couches
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- Figure 27: Mean amount spent on household furnishings, February 2015-March 2016
Consumer Style Preferences
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- Traditional/classic preferred by almost a rate of 2:1, but Luxury growing
- In their words
Reasons for Buying Furniture
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- New furniture can be one of life’s little luxuries
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- Figure 28: Reasons for buying furniture, April 2016
- Younger consumers exhibit more ‘want-based’ buying behavior
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- Figure 29: Reasons for buying furniture, by age, April 2016
- Messages about rewards could increase penetration among Blacks
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- Figure 30: Reasons for buying furniture, by race and Hispanic origin, April 2016
Retailers Shopped
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- Traditional home furnishings and broad-reaching merchants
- Retailer preference reflects value-conscious consumer mindset and a drive for convenience
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- Figure 31: Retailers shopped for furniture, April 2016
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- Figure 32: Retailers shopped for furniture, by household income, April 2016
- Other channels/retailers shopped
- Furniture-focused retailers face tough competition
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- Figure 33: Other channels/retailers shopped for home furnishings, April 2016*
- Recent happenings
Reasons for Choosing Furniture Retailer
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- Consumers seek variety and service when seeking a furniture retailer
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- Figure 34: Reasons for choosing furniture retailer, April 2016
- Image and reputation matter
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- Figure 35: Opinions about online reviews, January 2015
- Retailers can differentiate on service
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- Figure 36: Service-oriented reasons for choosing furniture retailer, by generation, April 2016
- One out of four consumers pay attention to finance offers
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- Figure 37: Agreement to finance offers as a reason for choosing furniture retailer, by select demographics, April 2016
- In their words
Method of Purchasing
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- Consumers still prefer to shop in-store, but online shopping is rising
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- Figure 38: Method of purchasing, April 2016
- Millennials and men driving the online movement
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- Figure 39: Method of purchasing, by generation, April 2016
- Shopping process is slow and deliberate
Attitudes toward Buying Furniture Online
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- Fear and scepticism deter potential online buyers
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- Figure 40: Attitudes toward buying furniture online, April 2016
- Nearly one fifth adamant about not buying online
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- Figure 41: Attitudes toward buying furniture online, by gender and age, April 2016
- Consumer segments open to buying online
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- Figure 42: Attitudes toward buying furniture online, by consumer segments, April 2016
- Customer service and sales assistance online is important, especially to Hispanics
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- Figure 43: Attitudes toward buying furniture online, by Hispanic origin, April 2016
- In their words
- Open-minded
- Sceptical of buying online
- It depends
General Attitudes and Behaviors toward Buying Furniture
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- Searching for the “right” item and willing to pay for it
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- Figure 44: Attitudes and behaviors toward buying furniture, April 2016
- Men and women vary in their shopping approach
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- Figure 45: Select attitudes and behaviors toward buying furniture, by gender, April 2016
- Nearly one third open to secondhand furniture market
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- Figure 46: Attitudes toward secondhand furniture, by key demographics, April 2016
- The secondhand market in their words
Influencers
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- Two thirds of buyers influenced by media
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- Figure 47: Influencers, April 2016
- All consumer segments very actively seek out ideas and inspiration
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- Figure 48: Influencers, by consumer segmentation, April 2016
- Licensing is booming
- Are these companies missing the boat?; the role of micro-influencers
- What about social media? Does it play a role?
Appendix – Data Sources and Abbreviations
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- Data sources
- Sales data
- Fan chart forecast
- Consumer survey data
- Consumer qualitative research
- Direct marketing creative
- Abbreviations and terms
- Abbreviations
- Terms
Appendix – Market
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- Figure 49: US consumer expenditures for furniture, at inflation-adjusted prices, 2011-21
- Figure 50: US consumer expenditures for furniture, by type, at current prices, 2014-15
- Figure 51: US consumer expenditures for furniture, by channel, at current prices, 2014-15
- Distribution channel definitions
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- Figure 52: Population by race and Hispanic origin, 2011-21
- Figure 53: Median household income, in inflation-adjusted dollars, 2004-14
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- Figure 54: Seasonally adjusted US homeownership rates, 2005-Q1 2016
- Figure 55: Homeownership rates, by age of householder, 2005-Q1 2015*
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Appendix – Key Players
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- Example ads
- Mass merchandisers
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- Figure 56: Target, Email ad for Pillowfort and other home goods, March 2016
- Home furnishings retailers
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- Figure 57: Bed Bath & Beyond direct mail ad, May 2016
- Figure 58: Crate & Barrel partial Email ad, June 2016
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- Figure 59: HomeGoods Email ad, April 2016
- Figure 60: Ikea partial Email ad, June 2016
- Figure 61: Pier 1 Imports partial Email ad, June 2016
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- Figure 62: Pottery Barn partial Email ad, June 2016
- Figure 63: Restoration Hardware partial Email ad, June 2016
- Figure 64: Wayfair.com partial Email ad, June 2016
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- Figure 65: West Elm partial Email ad, June 2016
- Figure 66: West Elm, Email ad for local showcase event, June 2016
- Furniture-focused retailers
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- Figure 67: Ashley Furniture Homestore, Email ad, June 2016
- Figure 68: Value City Furniture, Email ads, June 2016
- Figure 69: Ethan Allen, Email ad, June 2016
Appendix – Consumer
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- Additional qualitative
- Rental furniture
- Reasons for buying
- Secondhand furniture
- Buying furniture online
- Payment
- Incentives
- Attributes
- Other data
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- Figure 70: Household furnishings purchased, January 2011- March 2016
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- Figure 71: Mean amount spent on household furnishings, by gender and age, February 2015 – March 2016
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- Figure 72: Home furnishing stores shopped, past three months, February 2015 – March 2016
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- Figure 73: Frequency of shopping at home furnishing stores shopped, past four weeks, February 2015 – March 2016
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