From Home Furnishing Business
Cover Story: SHOPPING BEHAVIOR EVOLVES AS THE PANDEMIC CONTINUES
As the shock of being declared “non-essential retail” at the end of March, brick and mortar furniture stores struggled with downsizing, or at times, closing down. Some ignored the non-essential status. By the time May and June rolled around, some furniture retailers learned to adapt their brick and mortar operations and began to execute an e-commerce experience as some businesses began to reopen. Even though there were retailers that escaped being forced to shut down—including e-commerce, general merchandise stores, and home improvement stores—it was obvious that consumers were in nesting mode and wanted to enhance their homes and make the most of their space when faced with the shelter in place orders. Consumers homes took on many roles including offi ce, school, and gym, which meant there was a need to make living spaces as comfortable as possible.
Slowly consumers returned to shopping at regular home furniture stores, not so much in quantity, but with a commitment to purchase leading to higher close rates and average tickets.
Higher WRITTEN SALES
averaging more than 50%— and at times doubling the same week last year—created an exuberance along with a fatigued sales team. Beyond what was obviously pent-up demand, there was a feeling that consumers had rediscovered their homes and would continue to allocate disposable income to home furnishings. The statistics supported that optimistic outlook. According to consumer personal expenditures (CPE), furniture has rebounded, recapturing the loss in March/April.
To better understand this shift, FurnitureCore, Inc., parent company to Home Furnishings Business, conducted a national survey of consumers who purchased furniture after March of 2020 to those that purchased in 2019.
Without a doubt, the COVID-19 pandemic caused a seismic shift in the consumers’ lifestyle. In general, our focus moved toward the home and away from travel. The benefi - ciary of this shift has been furniture along with other large purchases that had “stay at home” appeal. The most immediate need was home computers to address the transition to virtual learning and working from home (56% increase) and communication (29% increase). Leisure travel declined (3%), but not as much as the purchase of new cars. Table A compares the ranking of importance with “1” being the most important of five major purchases.
The belief is that once the immediate need for computers and communications are met, there will be a continuing shift to the importance of furniture.
As with most major purchases, the acquisition satisfi ed an internal need as well as an external statement to friends and acquaintances. After the pandemic, the external satisfaction has become more important. As can be seen from TABLE B, the external statements have become more important, such as refl ected by the consumer’s sense of STYLE and PROSPERITY.
Over the past twenty plus years, acquiring home furnishings has migrated from the “lady of the house” to a more joint endeavor. Interestingly enough, with time on their hands, the male has pursued furnishings with a passion. Table D compares the before and after.
This trend could be significant considering that males are more inclined to purchase online. There has been a sizeable shift in who initiates the furniture purchase. Again, the male leads the way as can be seen in Table E.
This is a signifi cant change that will impact how furniture is advertised. What are the advertising messages that will infl uence the male compared to female? All of this will be addressed later.
With this shift in the buying process, was there a change in the basic motivation for the home furnishings expenditure? The change in lifestyle dictated by the pandemic has created a surge in home purchases. As can be seen in Table F this surge has been refl ected in purchases instigated by recent moves and remodeling.
A special note should be made in regard to a signifi cant increase in buying for the second home. Free from the constraint of working at the physical offi ce, consumers escaped to the mountains and the seashore.
Following the trends of the previous fi ndings, the male overwhelmingly ventured out into the new world of shopping using a mask and following social distancing recommendations. Table G presents the statistics.
The survey fi ndings supported the anecdotal evidence that consumers turned to the Internet to conduct research before venturing out to the stores with 56.37% indicating the Internet was the fi rst step in the buying process, up from 47.98% the year before. Traditional advertising, such as television, newspapers, and magazines declined to be replaced by recommendations from friends and relatives. Table H contains the breakdown.
This finding was substantiated by a national sample of traditional furniture retailers’ unique visitors to their website.
However, note the trending down of visits to the Internet after Labor Day. Should we have concerns? After the initial shock of being sidelined by being designated as “non-essential” independent retailers fought back and retained their share of the consumer demand. However, the Internet gained a signifi cant share of the market. Table J presents the statistics.
It is interesting to note the loss in the lifestyle stores and regional chains. A contributing factor could have been the length of time stores were closed initially. Owner/operators are more driven to keep the doors open. Contrary to popular thought, after the pandemic shutdown the online home furnishings customers were not first-time online purchasers based upon this national survey.
No matter the experience level of the online purchaser, the concerns were the same, but the inability to “see and touch” was amplifi ed during the shutdown.
The impact of the pandemic has not been refl ected in how far the consumer is willing to travel to purchase furniture. However, in recent years as furniture retailers have added locations to make it easier for consumers, the concept of furniture shopping being defi ned as “destination” has all but disappeared. Across the nation in large and small markets 10-24 miles is the norm. Table M illustrates.
If the distance driven has not signifi cantly decreased, the time spent shopping has begun to decline. With 57% of consumers fi nishing the process in less than two weeks, this indicates the furniture retailer must be prepared to close the sale. This points out the growing necessity to begin the selling/ buying process on the phone with a more interactive retailer website using “chat” and email. Table N illustrates.
This reduction in time spent shopping has been driven by a reduction in the number of retailers shopped. The trend to fewer retailers shopped driven by increased pre-shopping research on the Internet will be accelerated by the pandemic as can be seen from Table 0.
In this period of intense demand, the reputation of the manufacturer has surged in importance (15.4% – 21.89%) and is indicated as most important while perceived quality and design declined as a purchase motivator. Price increased slightly. Table P provides the statistics.
It should be noted that general merchandise retailers, such as Big Lots and Target, are selling reputed brands like Broyhill. Obviously with the disruption, new requirements have become necessities. In the retail experience, consumers ranked the importance of these new requirements and confi rmed that the use of masks was most important compared to the other requirements. Table Q summarizes.
With all the noise around the signifi cant changes in everyday living, furniture retailers are perceived to be doing a good job by more than 50% of the consumers. However, we should have some concerns when we compare independent furniture retailers to the Internet.
Our challenge is to reestablish brick and mortar to provide the best consumer experience. Systematic changes provide opportunities.