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From Home Furnishing Business

Growing Green

 


Consumers desire for eco-friendly home furnishings is trending upward, but marketing the green tale needs to grow.

The sustainable furnishings segment continues to make strides, and as headlines scream of flammable chemicals and other things hiding in furniture, consumers are turning an interested eye toward more eco-friendly goods.

The industry has closed the books on 2015 that brought with it changes in regulations in formaldehyde and flammability issues. The headlines of sofas that burst into flames and harmful chemicals hiding in chest of drawers can be downright scary.

Because of that, consumers are looking for a way to make their homes healthier, and a big part of that can be found from the furniture they buy to furnish those homes. Throw in the climate change debate, and sales of sustainable goods should be poised to take off.

The latest Green Home Furnishings Study showed that consumers are concerned about environmental issues like pollutants in the waste stream, deforestation and depletion of natural resources. Consumers’ attitudes on sustainability are outlined in Table 1.

 

 

While attitudes toward sustainability are very real and valid, they aren’t strong enough to override price considerations, style requirements, discounts and other purchasing concerns when it comes buying sustainably made furniture.

“Good for the environment” landed in the No. 9 position—last place—behind other considerations consumers take into account when buying home furnishings.

 

 

The survey was conducted by Impact Consulting Services, parent company of Home Furnishings Business, last year. The survey included a national sample of 500 consumers and delved into the perceptions consumers hold about eco-friendly furniture, impressions about price and just how much—or not—they are aware of what exists in sustainable furniture.

 

 

The green home furnishings category seems to be suffering from lack of marketing and advertising to consumers on any large-scale basis. From the survey, about 45 percent of the surveyed consumers indicate they had not bought green home furnishings because they weren’t aware any were available. (See Table 3.) In addition to that, only 9 percent of those surveyed had bought furniture that was considered green or earth-friendly.

Advertising and marketing are key to educating consumers that such home furnishings are available and where they are sold. Some of the responsibility falls to retailers selling the goods, and some of it falls squarely with manufacturers who are supplying the environmentally friendly furniture.

Just like all marketing, advertising green home furnishings requires a sustained campaign to sell the concept. While such advertising comes across in a number of consumer shelter magazines, there’s no consistent message being pushed.

Telling a green story can be fun, touching and can often capture the consumer’s eye.

According to a recent study by Nielsen, sustainability can good for the bottom line. The research firm noted that companies with a commitment to sustainability have grown more than 4 percent globally compared to those with no such commitment who have posted a 1 percent growth.

The survey, which included 30,000 consumers in 60 countries, showed that onsumers are keen on being responsible citizens, and look for the same from the companies from whom they buy.

Carol Gstalder, a senior vice president with Nielsen said consumer brands that haven’t yet embraced sustainability are at risk.

“Social responsibility is a critical part of proactive reputation management,” she said. “And companies with strong reputations outperform others when it come to attracting top talent, investors, community partners and most of all, consumers.”

A note. Consumers are mixed in how they assess a brand’s commitment to sustainability, according to the Nielsen survey. For some, an organic label is most important; while others are looking for brands that pitch a reduction in carbon footprint. Others look for companies that associate with reputable non-profits to give back to their communities.

It’s definitely not a one-size-fits-all scenario.

Overall, Nielsen reports the market for sustainable goods is expanding. Companies willing to listen and act, will see bottom line growth from additional revenue.

 

There’s no lack of knowledge on the part of home furnishings consumers when it comes to familiarity of green options and terms associated with them. Energy Star rating—more in line with appliances—remains at the top of the list with more than 70 percent of consumers saying they were familiar with the term.

Why?

Well, simply put, appliance retailers, like hh Gregg, Lowe’s, The Home Depot and the myriad of independent dealers, along with the manufacturers, often tout Energy Star ratings in their advertising. The more they hear it the more it sinks in with consumers.

Terms more in line with furniture speak, like recycled content, reclaimed wood and organic fabrics, were familiar to at least 38 percent of the surveyed consumers.

The conversation is ready for the starting; those who interact with the consumer must have the vernacular and the know-how to subtly educate.

 

 

Sticker Shock

If all things were close to being equal—style, function and price—consumers would be mostly interested in eco-friendly home furnishings. Nearly 74 percent (73.8 percent) would be somewhat interested, possibly and definitely interested in buying green home furnishings if they were priced about equal to other products. Table 5 breaks down how the consumer respondents view green home furnishings

Consumers have a perception that environmentally friendly home furnishings cost an exorbitant amount more than those not dubbed eco-friendly could be hindering sales of the goods.

While it may be a misperception on the consumer’s part, it’s a hurdle that needs to be cleared to boost sales in the category.

More than 42 percent of consumers they would pay nothing more for certified green home furnishings. Only 29 percent said they’d pay up to 5 percent more for such certification. Fewer than 2 percent of the consumers said they’d pay more than 20 percent for a green certification on home furnishings.

Third-party certifications of FSC-certified wood can add between 10 percent and 15 percent to the price of a chest of drawers.

The Nielsen study indicates the same hesitancy on the part of consumers to dig deeper in their wallets to buy green, but there’s a glimmer of hope.

“The hierarchy among drivers of consumer loyalty and brand performance is changing,” said Grace Farraj, senior vice president of public development and sustainability for Nielsen. “Commitment to social and environmental responsibility is surpassing some of the more traditional influences for many consumers. Brands that fail to take this into account will likely fall behind.”

Interestingly, the Nielsen study indicates price pressures, too.

The company points out a significant gap between the percentage of consumers who want more eco-friendly products (26 percent) and those who report having purchased them (10 percent).

Nielsen probed further asking consumers about key purchasing drivers and what prompted them to buy. The company provided a list of factors ranging from the amount of trust they held in a brand to the impact of a television commercial.

The No. 1 driver—62 percent or nearly two-thirds—was whether or not the product was made by a brand or company trusted by the consumer. Another 45 percent said a company’s commitment to the environment could sway product purchase decision.

According to Nielsen, 65 percent of total sales in 2014 measured globally were generated by brands whose marketing conveyed commitment to social or environmental values.

Gstalder said the shifts indicate the opportunity for companies that have cultivated a high level of trust to introduce sustainable products into the market.

“On the flip said, large global consumer brands that ignore sustainability increase reputational and business risk,” she said. “This may give competitors of all sizes, the opportunity to build trust with the predominately young, socially conscious consumer looking for products that align with their values.”

While pricing pressures are real, consumers show some signs of changing their tune and their willingness to pay a big more is trending upward.

In 2013, the research firm said half of consumers were willing to pay extra for products from companies with a positive social and environmental impact. In 2014, 55 percent said they’d pay more, and most recently, that number had jumped to 66 percent.

 

Age Matters

All companies are intrigued by the Millennial generation, and it should come as no surprise that this consumer segment is ready, willing and able to buy into the eco-friendly home furnishings market.

Coming of age during a time when recycling is the way, the truth and the light, nearly three-fourths of these consumers are willing to pay extra for sustainable offerings. That’s up from half during last year’s Nielsen study.

Coming on their heels, Generation Z—the under 20 set—are just as likely to pay more for goods that are sustainable. Seventy-two percent of this age group said they had no problem anteing up the extra cash for green products.

“Brands that establish a reputation for environmental stewardship among today’s youngest consumers have an opportunity to not only grow market share, but build loyalty among the power-spending Millennials of tomorrow, too,” Farraj said.

Don’t leave the Boomers out of the picture, Farraj cautions.  More than half—51 percent—of Baby Boomers are willing to pay extra. That’s an increase of 7 percent over last year’s report, and Boomers remain a viable market for the next decade.

 

Forward Motion

Overall, the industry is making progress, although, according to the survey, it’s slow and tedious when it comes to consumer awareness and acceptance of green home furnishings. Retailers and others believe it’s imperative that sales associates who interact with consumers receive training to better share the sustainability side of the business. Another key point: Marketing teams need to improve point of sale materials to better share the sustainability story of product displayed in retail showrooms.

The Sustainable Furnishings Council and the American Home Furnishings Association are key organizations that continue to drive the message home that sustainably crafted furniture free from harmful chemicals makes for healthier, safer homes.

The SFC is celebrating its 10th anniversary this year, and continues to make strides in awareness to move the needle within the industry and directly to consumers.

Last month in its state of green webinar, Susan Inglis, executive director, shared an update on where the council has made an impact. Changing regulations were a big deal for the home furnishings industry last year—think formaldehyde emissions, flammability changes—and many of those things will remain on the front burner moving through 2016.

“Ten years ago, we were move focused on climate change and the impact our industry had on it,” Inglis said. “Now, we’re seeing more focus on health and healthier living environments.”

Steve Freeman, president of SFC and vendor resource manager with retailer Room and Board, said the council remains committed to its ongoing work and remains vigilant in educating its members on changes that will impact them.

On the marketing front, the SFC offers its members use of its logo and other collateral to help tell the green story in any advertising be it in print or online.

 

200North

The Frisco panel bed with attached nightstands is crafted of quick-growing bamboo. Suggested retail is $5,854.

 

Copeland Furniture

The Weston bedroom collection is made from sustainably harvested hardwoods and is available in a number of Greenguard Certified finishes for low chemical emissions.

 

Durham Furniture

Sustainably harvested wood is used to create the Front Street bedroom collection. Suggested retail as shown is $8,560.

 

Gat Creek

The Brancusi storage sleigh bed is built from locally and sustainably sourced Appalachian Cherry in a factory located in the center of the Appalachian Forest. Suggested retail for queen bed is $2,950.

 

Greenington Fine Bamboo Furniture

Inspired by mid-century design, the Nova Antares occasional collection is made from solid bamboo.

 

Lee Inds.

The 1391 chair features environmentally friendly soy-based seat cushions. Suggested retail $2,468.

 

Loloi

The Giselle collection is hand-knotted entirely of refurbished sari silks from India. Suggested retail is $1,949 for an 8x10 rug.

Norwalk

The Sophia sofa, crafted in the U.S., is available in 800 fabrics, 125 leathers and 30 wood finishes. Retail pricing begins at $1,899.

 

Phillps Collection

The Petrified Mosaic Drum stools are made of thin slices of petrified wood tiled together.

 

Rowe

The Nantucket sofa is built with a number eco-friendly elements and is built in a factory that recycles every piece of raw materials. Suggested retail is $1,299.

 

Vanguard Furniture

The Sierra cocktail table is made from reclaimed wood.

 

Chloe & Olive

The Cinco de Mayo pillows are handmade by local seamstresses in California. The pillow inserts are sustainably made from post consumer recycled plastic bottles. Suggested retail is $72.50.

 

Jaipur

The Baza-Subra by designer Nikki Chu offers a new take on sisal with texture and pattern. Suggested retail is $1,104 for an 8x10 rug.



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