Online Shopping for the Home - US - April 2021

OVERVIEW
What you need to know
Key issues covered in this Report
Definition
Economic and other assumptions
COVID-19: US context
EXECUTIVE SUMMARY 
Top takeaways
Market overview
Figure 1: Total US sales and fan chart forecast of furniture and home furnishings, at current prices, 2015-25
Impact of COVID-19 on home categories online
Figure 2: Short-, medium- and long-term impact of COVID-19 on furniture and home décor , April 2021
Opportunities and challenges
Streamline the shopping process through social
Bridge the gap between online and in-store shopping
Focus on multifunctional items
Bring the focus on sustainability to the forefront
Capitalize on the association between living spaces and wellbeing
THE MARKET – KEY TAKEAWAYS
Favorable economic and industry trends support category growth
There is no going back from ecommerce
MARKET SIZE AND FORECAST 
Changes to lifestyles and increased time at home will drive category growth
Figure 3: Total US sales and fan chart forecast of furniture and home furnishings, at current prices, 2015-25
Figure 4: Total US retail and ecommerce sales and forecast of furniture and home furnishings, at current prices, 2015-25
The pandemic accelerated the adoption of ecommerce
Figure 5: Total US ecommerce sales and fan chart forecast of furniture and home furnishings, at current prices, 2015-25
Impact of COVID-19 on shopping for the home
Learnings from the Great Recession
Figure 6: Historical personal consumption expenditures in furniture and Home décor
SEGMENT PERFORMANCE
Favorable environment, still consumers focus on what is essential
Figure 7: Total US retail and ecommerce sales of furniture and home furnishings by segment, at current prices, 2014-20
MARKET FACTORS 
The international trade disruption
High unemployment and low consumer confidence result in restricted spending
Figure 8: Consumer confidence and unemployment, 2000-March 2021
The movement of the masses
Figure 9: Rental and homeowner vacancy rates, March 2021
Figure 10: US historical homeownership rates
The sustainable lifestyle
Figure 11: West Elm drives in-store recycling, March 2021
The digital transformation
Figure 12: Shopping behavior – Digital tools use, February 2021
COMPANIES AND BRANDS – KEY TAKEAWAYS 
Home retailers are adopting new ways to reach customers online
Evolve to meet changing lifestyles and shopping behaviors
COMPETITIVE STRATEGIES
Outer uses customer homes as showrooms
Figure 13: Outer virtual showrooms
Target partners with Levi’s to launch a home décor line
Figure 14: Levi’s x Target partnership includes home items
West Elm creates a shop in shop online
Figure 15: Fresh + West Elm, March 2021
Ikea encourages consumers to extend the life of furniture and live more sustainably
Figure 16: Ikea’s sustainable efforts
Retailers are exploring new catalog formats
Figure 17: Crate&Kids Pinterest catalog
Figure 18: CB2 Spring ‘21 collection
Figure 19: Ikea Audio catalog
MARKET OPPORTUNITIES 
Offer value in its different forms to keep the momentum going
Focus on multifunctional items
Embrace the sustainable lifestyle
Capitalize on the association between living spaces and wellbeing
Drive interest through partnerships and collaborations
THE CONSUMER – KEY TAKEAWAYS  
eCommerce adoption accelerates; yet the physical store is no less important
Consumers seek convenient and seamless online shopping
Good for the consumer, the community and the planet
Looking ahead frictionless shopping is key to compete online
Consumers are active on social platforms; brands need to do the same
ITEMS PURCHASED
Home décor
Consumers are shopping across all types of home décor items
Figure 20: Items purchased – Home décor, February 2021
Home renters seek in-home décor items more than an aesthetic pleasure
Figure 21: Items purchased – Home décor, by housing situation, February 2021
Young women are investing in their home belongings
Figure 22: Items purchased – Home décor, by gender and age, February 2021
Furniture
Consumers prioritize certain rooms for furniture purchases
Figure 23: Items purchased – Furniture, February 2021
Figure 24: West Elm
Men are into staple items when shopping for the home
Figure 25: Items purchased – Furniture, by gender, February 2021
Gen Z and Millennials drive the furniture demand online
Figure 26: Items purchased – Furniture, by generation, February 2021
RETAILERS SHOPPED
Amazon dominates online shopping for the home
Figure 27: Retailers shopped, 2021
Diversity in assortment is key to appeal to women
Figure 28: Retailers shopped, by gender, 2021
Figure 29: Etsy – Home décor seller
Investments in digital marketing initiatives to attract young consumers, represent a customer lifetime value
Figure 30: Retailers shopped, by generation, 2021
APPROACH TO SHOPPING FOR THE HOME
Consumers are growing accustomed to ecommerce
Figure 31: Online home purchases, February 2021.
Browsing
Exploration takes place across channels
Figure 32: Browsing habits, 2021
Figure 33: CB2 retargets with sale notifications
All generations are browsing online; Gen X leads the way
Figure 34: Browsing habits – Generation, by online dominant, 2021
Purchasing
Similar to browsing, consumers are buying both online and in-store
Figure 35: Purchasing habits, February 2021
Meet customers everywhere, at any time
Figure 36: Purchasing habits – Multichannel shoppers, by generation, February 2021
SOURCES OF INSPIRATION
Social media goes beyond inspiration
Figure 37: Source of inspiration, February 2021
Figure 38: TURF analysis – Source of inspiration, February 2021.
Figure 39: Pottery Barn sparks inspiration via Instagram
Leverage social channels to bond with women
Figure 40: Lowe’s x New York Fashion Week
Figure 41: Source of inspiration, by gender and age, February 2021.
Connecting with older consumers where they’re looking for inspiration
Figure 42: Source of inspiration, by generation, February 2021
SHOPPING BEHAVIOR 
When shopping for the home online, consumers are very thorough
Figure 43: Shopping behavior, February 2021
Multicultural consumers prioritize frugal shopping
Figure 44: Shopping behavior – Shop around for the lowest price, by race/ethnicity, February 2021
Men need assurance of their home purchases
Figure 45: Shopping behavior, by gender and age, February 2021
There is a lasting appreciation toward living spaces
Figure 46: Category approach, February 2021
Consumers seek longevity in their home goods, but some prioritize affordability
Figure 47: Category approach, by generation, February 2021
Younger consumers experiment to find what better works for them
Figure 48: Category approach, by generation, February 2021
SHIFTS IN SHOPPING BEHAVIOR DUE TO PANDEMIC 
More home projects and less in-store visits
Figure 49: Shifts in behavior, February 2021
The adoption of e-commerce accelerates across generations
Figure 50: Shifts in behavior, by generation, February 2021
PURCHASE MOTIVATIONS AND BARRIERS
Motivators
At this point in time, home improvements drive furniture and home décor purchases
Figure 51: Motivators to purchase, February 2021
Figure 52: Sherwin-Williams x Pottery Barn Kids partnership
Mothers bring the traditions at home
Figure 53: Motivators to purchase by parental status of children under 18 in household, by gender, February 2021
Millennials shop for entertaining and events
Figure 54: Motivators to purchase, by generation, February 2021
Figure 55: Ready, Set, Prep by Crate & Barrel
Barriers
Delivery costs turn consumers away
Figure 56: Barriers, February 2021
Frequent online shoppers seek convenience and flexibility
Figure 57: Barriers, by online shopping frequency, February 2021
FUTURE SHOPPING BEHAVIOR 
Streamlined returns are key to moving forward
Figure 58: Future drivers, February 2021
Interest-free installment payments are a simple way to enhance the shopping experience
Figure 59: Future drivers, by age and income, February 2021
Consumers embrace technology; men lead the way
Figure 60: Future drivers, by gender and age, February 2021
Figure 61: Crate&Barrel highlights digital capabilities
 ATTITUDES TOWARD SHOPPING FOR THE HOME
The emotional impact
Consumers’ living spaces contribute to overall wellbeing
Figure 62: Attitudes toward shopping for the home, February 2021
Sustainability focus
Circular shopping attracts the young crowd
Figure 63: Attitudes toward shopping for the home, by generation, February 2021
Focus on collaborations
Men appreciate the expertise when shopping for the home
Figure 64: Attitudes toward shopping for the home, February 2021
APPENDIX – DATA SOURCES AND ABBREVIATIONS
Data sources
Sales data
Forecast
Consumer survey data
Consumer qualitative research
Marketing creative
Abbreviations and terms
Abbreviations
APPENDIX – THE CONSUMER
Online discussion panel
Home style
Living situation
Perception of rooms
COVID-19 impact on the home
Impact on mood
Future projects
Additional data referenced
Figure 65: Population, by generation, 2016-26
Figure 66: Spending habits, past 12 months – Home and garden products (eg furniture, domestic appliances), March 2021