From Home Furnishing Business
Cover Story: Escaping the ‘Not My Parent’s Furniture’ Conundrum
It is a statistical fact that the industry is going through a watershed moment as the nation transitions from the impact of the Baby Boomer generation to their kids, Generation X and interestingly, their kids, the much-discussed Millennials. Just to refresh everyone’s memory, the chart to the right shows the particulars.
One thing is for sure Generation X doesn’t want the “brown furniture” of their parents. Just call a consignment shop to inquire about purchasing your 18th century Henkle Harris dining room group. After the insult for what they would pay if they would buy it, you realize that your furniture has not appreciated in value the way your home has in the last 35 years.
The lifestyle of the Baby Boomer while in their 30s was all about presenting the image of success and prosperity. That is as it is today, as indicated by the recent national research conducted by FurnitureCore, the research arm of Home Furnishings Business.
As can be seen from the table at the bottom of the page, by the time Baby Boomers reached retirement age, their attitude had diminished and had become more practical. The takeaway is, consumers have not changed when they are beginning to furnish their fi rst home. The fact is home furnishings is important, but just not the style or look of their parents.
The research indicated consumers are unfortunately stuck in I want to change my style. The research provides the most recent input.
Compared to last year, statistically there has been litt le change except cott age increased 9.44% to 13.2% and mid-century fell 8.15% to 5.0%. However, if we compare the older Millennials (25-34) we can see the coming tsunami.
The challenge for established retailers and manufacturers is how to serve the existing consumer base while addressing the taste of the consumers that are entering the market. This is the opportunity for the new manufacturer or retailer of a direct-toconsumer manufacturer to launch a new company. This opportunity is obvious from the research presented.
Obviously, contemporary and industrial will be the style of choice for the emerging consumer in their twenties.
Starting with the manufacturer that develops products to be sold by the retailer, it is diffi cult to translate a “style” term to a specific look beyond the very basics. In other words, style is in the eyes of the beholder. New styles evolve from the successes of the past 12 months.
The issue for the manufacturer is that they are two steps removed from the consumer. While the retailer’s web presence importance is well established, with 73% of consumers visiting the retailer’s website, the manufacturer’s web presence is not as integrated into the consumer’s buying process. What bett er way to obtain input on style from the consumer than from the manufacturer’s website? La-Z-Boy solicits input from the consumer by using a style quiz— specifically, DesignCliq, a proprietary product of FurnitureCore. After answering ten questions, the consumer receives an output that clarifies their style and offers La-Z-Boy products that represent the particular style designation. The consumer has an opportunity to agree or disagree — a surprising number (92%) concur. What better feedback for the manufacturer? If you have been in a La-ZBoy showroom recently, it is evident that the furniture is not reflective of the consumer’s parent’s product.
A more digital approach used by some manufacturers is social media. While receiving great input for the product development process, it also creates the opportunity to build brand. Houston-based Classy Art, a resource for wall art and décor, has been using an atypical strategic selection process for items that make entry into their product line. It is a three-step process for all items they are considering. “I got really sick of spending a large amount of valuable time and resources to unload items that were under performers, because it did an injustice to our customers and our warehouses,” says Gabriel Cohen, owner of Classy Art. The first step is to review the potential items with their major accounts to see how each item would fit into those programs both current and future. If an item does not fit, it is removed from potential consideration at that time. For the items that make it through this round, the company then turns to their consumer focus group for step two. Classy Art has nearly 1500 members that review the remaining items using Facebook. Each member reviews the overall style of each item and casts their votes using likes and comments. After the items have been reviewed by the focus group, they evaluate the exact number of likes that item received. After the second round of judging comes the final cut. If an item was well liked, however it did not carry the value of both size and cost that the market supports, then it is eliminated. By implementing this process Classy Art found that items hit the ground running faster and harder. In addition to the testing on the front side of launching an item, they also cut 20% of the bottom performers in each category, each quarter. Rarely are they promoting items that do not perform well, according to Cohen.
Another updated approach to focus groups is also handled online. FurnitureCore, a dynamic web application aimed at the furniture industry, has an online focus group application that can solicit input from the manufacturer’s targeted consumer receiving 400+ national completion.
These results can be drilled down to specific demographics. Additionally, with today’s AR/VR capabilities, the products can be viewed in 3D with illustrated functionality.
While the look is important, the price point is the next barrier. The manufacturer must understand where the new product price falls in the retail price curve. The positioning of the product is important. The graphic above presents only middle price points.
To enhance graphic presentation, the premium price point ($2,000+) has been excluded. These statistics were at retail based upon the manufacturer’s target margin/multiplier based upon distribution channel.
We should stress that the product design element of the merchandising process is very much an art inspired process. Note the comments sprinkled throughout this story from those in the industry that are involved in the process of merchandising their product lines.
According to Lisa Cody, vice president marketing at Twin Star Home, their product development process is fueled by a disciplined approach to understanding who their customers are, what makes them tick and what their unmet needs are. Consumer insights play a continuous role in product design and innovation and come from a variety of formal and informal sources. “We validate what we’re doing in terms of product design before, during and after a product launches. In order to develop products that are relevant to consumers, we use research to understand how they live in their homes, what their homes are like and what they need and desire to live in comfort. We capitalize on those insights to kick off our process and drive the form, function and features of any given product.”
Cody says once products are in the early stages of development, they check back in with the consumer to validate they are on the right track and use their feedback to make refinements. “After a product launches, we monitor consumer reviews, comments on social media and details gleaned from customer service calls to find out what consumers love…and don’t love about our products so we can implement refinements and improvements.” What they learn is shared and leveraged cross functionally so that everyone can take action on what was heard.
Michael Lawence, VP at Najarian Furniture says, “Our approach is to work closely with our retail partners and engage in dialog to ensure our finger stays on the pulse of what shoppers are looking for at retail and design accordingly. Our niche has always been, and continues to be, unique, classic, timeless designs. Though we incorporate trendy, transitional styles... classic, timeless designs are consistently our sweet-spot."