Growth in mass merchants/discount retailers, such as Target and Big Lots, have shown growth as they discover the contribution of gross margin per square foot of selling space that the furniture product category provides.
The emerging consumers that follow the Baby Boomers are choosing their preferred channel of distribution based upon retail experience off ered. A recent survey by FurnitureCore (the research arm of Home Furnishings Business) separated the choices by age group. As can be seen from the table at left, regional chains are emerging as a preference for the under 45 age group, showing less of a preference for the Internet. It should be stressed that this survey is for furniture purchases over $300. The younger consumer (25-44) was very satisfi ed on a scale of 1-5 with 5 being very positive. The table below divides the response by age group.
Both of these points are contrary to the noise around the decline of traditional retailing. POWER 50 — METHODOLOGY Market share is the most heavily weighted factor determining who makes the list, accounting for 46% of the total score. It is determined by dividing the retailer’s estimated sales by the estimated retail sales of furniture and bedding in each of the markets in which the company participates, whether it is a metropolitan statistical area, micro statistical area, or a rural area. Sales of electronics, appliances, and housewares are not included. To arrive at a list of home furnishings retailers with the strongest online engagement, we measure by 14 separate metrics. Sources include Alexa, Facebook, MOZ, Open SEO, Twitt er, and Pinterest. On Facebook, for example, the number of “check-ins” and “likes” were among the metrics, as were the number of Twitter followers, Pinterest “pins” and Google Page Rank, just to name a few.
From that data, we used a basic ranking methodology, assigning a numerical value to the ranked list of each metric. (For example, the retailer with the highest number of Twitt er followers received a “1,” and so on.)
Then, we arrived at 14 individual scores calculated for each metric. After dropping the two highest scores to eliminate any outliers, the statistical average of the 12 remaining scores was used to calculate the fi nal social engagement score.
The fi nal factor in the Power 50 ranking is retail expansion, which accounts for 15% of the total score. Using public records, it measured store expansion and expansion into new markets. In addition to the Power 50, HFB compiled separate lists that ranked regional chains, large independents, vertically integrated retailers, and independents with sales of less than $50 million in a single state.
The concept of the home office has evolved alongside technology at an increasing rate. Advancements in technology have been added to desks themselves with the popularity of adjustable height desks on the rise. Alongside this, multiport charging stations and lighting can also be found in many of today’s desk solutions. To get to the heart of the conversation, we need to know what today’s consumer wants and needs are for their next home office purchases. After all, their need for these pieces may be just around the corner. According to Remote.co, a resource for businesses exploring the possibility of remote work, 73% of the workforce will be remote workers by 2028 as Millennials and Gen-Z flood the market.
Manufactures aware of this shift have weighed in with their foresight. “The concept of a home office continues to evolve as technology gets more minimalistic, says Stefanie Lucas, Bassett Furniture’s chief merchandising officer. “We find the key to consumers is the ability to be flexible for whatever room you may need. Building your own idea of a home office, rather than to be locked into a heavy, masculine look, is what we believe to be trending today.”
With open floor plans and more work from home, consumers are integrating their spaces for multi-use. Consumer research conducted by FurnitureCore, Inc., the research arm of Home Furnishings Business, showed that of consumers who recently purchased home office furniture, 69.77% define their home office space by the activity performed there while only 30.23% define it by the type of furniture in the room. The same research found that 46.51% of consumers define the primary use of the home office as an area to work when not in a regular office, followed by 39.53% as an area for home and family business, and 13.95% as a space for home-based business.
Lisa Cody, vice president of marketing at Twin Star Home, echoes these findings saying, “Thanks to the fact that more and more companies have embraced the concept of employees working remotely and the impact that is having on products and services that cater to consumers who work from their kitchen or family room, the future of the home office category is very bright.” Looking back on the FurnitureCore industry model, of consumers polled on their home office location, 60.47% reported the home office being in a dedicated space with 39.53% reporting it to be in shared space. We can expect this number to continue to shift along with open floor plans, more minimalistic technology, and increased remote workers.
When working from home, the entertainment area is close at hand if not already in the same room. Just as with home offices, technology shapes this category at accelerated rates. And it’s not just technology, but how the consumer accesses their entertainment today — think streaming services like Netflix or Hulu. Just as we faded away from VHS into DVDs in the early 2000s, we are fading away from DVDs into these services and similar offerings (Disney has recently released its own much anticipated streaming service, Disney+). These services have offered flexibility to consumers. As Tonja Morrison, director of marketing at Hancock & Moore pointed out, “With so many streaming services online, families can go to the movies whenever they like – in their home theater.”
Based on the same FurnitureCore industry model exploring consumer purchases in the home entertainment category, we find that 91.76% of consumers have their entertainment center in their living room or family room! Families certainly have a designated, central location to enjoy their favorite movies and shows together. Other locations included the bedroom at 8.25% and ‘other’ was indicated by 3.09%
Central to the entertainment center is of course the television. How the consumer wishes to display their television impacts the type of entertainment center they will purchase. Largely, consumers wish to place their TV on top of a console with media storage (53.61%) followed by wall mounted TVs (36.08%). As consumers make the switch to consolidated, minimalistic technology, we can expect wall mounted options to rise. Just as important is size of screen. 47.42% of consumers reported that their next TV purchase within a year would be a screen 55” or larger! 25.77% will purchase a screen 37”-52”, and 6.18% will purchase a screen 36” or smaller. The remaining 20.62% do not plan a purchase over the course of a year. Obviously these consumers will be looking at sizable display units to match. Read on to discover popular entertainment center displays and home office solutions that are sure to move off of your retail sales floor.
Metropolitan Statistical Areas come in all sizes, the largest being New York-Jersey CityWhite Plains, NY-NJ (a subset of the larger CBSA) and the smallest being Fairfield, IA. Statistically Speaking has divided the counties in larger markets over 1 million in population into three designations for analysis – Core, Central, and Outlying. The layers of these markets have unique demographics and marketing within them is not a one-sizefits-all approach. Core counties always contain the principal city of the MSA, followed by Central counties that also contain large distinct metro areas. Outlying counties are still part of the MSA, but are further out from the Core and contain smaller towns. Markets with less than 1 million in population are smaller and are divided into only Central and Outlying areas.
The largest MSAs, those with populations 2.5 million and over, consist of 23 markets with 169 counties. MSAs with 1 million to 2.5 million population have 43 markets encompassing 248 counties. Figure 1 shows a summary of MSAs by size and by Core, Central, or Outlying counties and the number included in the U.S. Census Bureau’s ongoing American Community Survey. Bottom MSAs consist of many smaller counties and markets.
It might surprise some to learn that 21.9% of all industry sales are sold in only 31 of the 3,142 counties – the Core of the largest MSAs. (See Figure 2.) Over 60% of industry sales occurred in 66 markets with population over 1 million. The MSAs with populations between 250,000 to 999,000 account for 22.6% of sales. While containing 344 counties, markets with less than 250,000 population only account for 7.8% of total furniture industry sales.
The Core urban areas of the top populated MSAs, 1 million and over, have the greatest concentration of 25 to 54-year-olds at 42%, while Central and Outlying areas have a higher percentage of older people (Table A). Central counties are the next layer out from the Core in the mega metro areas. Smaller markets under 1 million are not designated with Core counties rather only Central or Outlying. These Central counties also have more people in prime furniture buying years (25 to 54) compared to Outlying counties. In general, the less populated markets have a higher percentage of people over 55 – roughly 34% in Central micropolitan statistical areas and Outlying markets with less than 250,000.
As shown in Table B, Central counties beyond the Core within MSAs that have a population 1 million and over make the most money – a median income range of $75,000 to $99,000, partially due to more married-couples with dual incomes. Both the Core and Outlying counties within the largest MSAs have a median income between $50,000 and $74,999. Central counties in smaller MSAs and Micropolitan Statistical Areas also earn between $50,000 and $74,999, while Outlying counties in smaller MSAs that have a population less than 250,000 have a median income of $25,000 to $49,999.
Consistent with the median income chart (Table B), Table C shows the Central counties out from the Core in large MSAs over 1 million population have the highest household incomes with 11.7% earning $200,000 or more, compared to only 4.2% in Central counties in small MSAs with a population less than 250,000. The highest percentage of lower income earners under $50,000 can also be found in the smaller MSAs under 250,000 population. Urban, highly populated Core counties within top MSAs have a higher percentage (39.3%) of households earning under $50,000 than Central and Outlying counties within those markets, 31.3% and 35.7% respectively.
In terms of average incomes (as opposed to median), Central counties, suburbs closely connected to the Core areas, also have higher average household incomes than both the Core and Outlying counties regardless of the size of the MSA. Central counties in MSAs with a population above 2.5 million have an average income of $108,866 compared to $99,585 for Core counties and $98,772 for Outlying counties. In populations 1 million to 2.5 million, Central counties have incomes 18% higher than Core counties (Table D).
Not surprisingly, the larger the MSA the higher percentage of occupied housing units versus vacant housing units. Central counties within MSAs with populations 1 million and over have 91.9% occupied housing units, compared to 85.8% for Central counties in MSAs with population less than 250,000 (Table E).
The percentage of owner-occupied versus renter-occupied housing units fluctuates based on whether the counties are Core, Central, or Outlying within the MSA (Table F). As expected, Core counties within the largest MSAs have the most renters – roughly 47% percent of renter-occupied housing units. Outlying counties have predominately owner-occupied units, above 70% for both top and bottom MSAs.
While bigger MSAs contain households making higher incomes, housing is also more expensive and many more homeowners carry mortgages. Therefore, the smaller the MSA, the greater the percentage of owner-occupied housing units without a mortgage (Table G). Central counties in MSAs with population over a 1 million have 32.1% of owner-occupied housing units without a mortgage compared 37.2% for Central counties in populations between 250,000 and 999,999 and 41.5% for Central counties in populations less than 250,000. Over half of owner-occupied units (50.8%) in Outlying counties within the smallest MSAs are without a mortgage reflecting an older population.
The percent of occupied housing units with family households versus non-family households varies by type of county within the MSAs. At 70.8%, the highest percentage of family households in occupied units, are in Outlying counties within MSAs of a population 1 million and over. The percentage of family households ranges between 61% and 69% in all other counties types (Table H). In all counties within MSAs both big and small, married couple households are the majority type of family household – most above 73%. The larger MSAS, Core counties have the fewest married-couples in family households at 69% (Table I).
Our goal here at HFB is to help our readers improve the performance of their businesses by providing critical information, ideas and advice, so they can develop successful growth strategies for their companies. To assist you with that process, each year we have produced a Coach’s Corner article that reviews the last 12 months of columns to give you some ideas about potential items you could include in your plan to help your business prosper in the coming year. We call them “Retail Resolutions” for the next year.
In the past we have given you this list in our January issue and received many positive comments. However, it was also brought to my attention that we really should provide our readers with this information in the December Power 50 issue, so they can use it to set goals and create plans prior to kicking off the new year. This seems to make sense, so we have moved it up a month.
As before, I recommend you review the entire list, reread the articles that look interesting to you and then select two or three ideas to include in your sales improvement plan for 2020. They are presented in the order published, but that may not be how you need to approach them. Best to select those that are most important, then prioritize them based on urgency.
Here is what we gave you to think about the last twelve months to help you plan for the next twelve:
- December 2018 – Proactive Planning Produces Power 50 Performances – The big question I often get is: why do some organizations tend to always be at or near the pinnacle of their area of endeavor and others always lag behind? The answer boils down to the fact that they are great at studying how they did and figuring out ways to do better in every aspect of their game or business. The best sports teams analyze each area of their game and at the end of the year set targets for improvement during the next season. Once they know where they want to go, they create plans to get there. The best companies do the same thing. Here are some thoughts that may help you move the needle next year by starting off with a solid plan for what you want to accomplish.
- January 2019 – Retail Resolutions – Just like this column, last year’s issue listed the previous twelve Coach’s Corner topics. If you have not already gone back and reviewed the 2018 offerings to create your Retail Resolutions for 2019, you now have twice as many potential game changing ideas you can look at for next year’s planning process!
- February 2019 – Do Your Customers Know More Than Your Salespeople?– Have you ever heard of a customer saying: “It felt like I knew more about what the store offered than the salesperson did!” That is a very scary thought, but unfortunately, if you are not consistently communicating with your staff about your products, promotions and website, it is probably happening in your store every day. Here are some thoughts about making sure your customers are not saying this about you.
- March 2019 – Are You Harvesting All the Low Hanging Fruit You Can? – Lowhanging fruit is used to describe those things that are perceived as being easier to acquire than others. It also can refer to those items that give a greater return than others for the same or less effort. Here is a short list of some of the places a home furnishings retailer could look to find some low-hanging fruit they might be missing or at least not maximizing.
- April 2019 – Choose Your Battles for the Customers in Your Marketplace Carefully – It appears that all the research and expert opinions tend to point to the same issues and opportunities for retailers who are battling for customers in their marketplace. Common sense and a solid approach to capitalizing on your real opportunities to differentiate yourself from competitors, remain the best way to win!
- May 2019 – What Should My Sales Manager Be Doing? – Ever wonder what your sales manager should be doing to drive sales performance improvement in your store? If so, your sales manager is probably wondering the same thing! Here are some thoughts about what we have seen working for successful retail stores to help them guide their sales management efforts.
- June 2019 – What Do Top Sales Professionals Think About The Numbers? – Do your salespeople ignore, fear or totally reject the performance metrics you use to coach their selling efforts? If so, perhaps you need to revisit the importance of these numbers with them to gain their buy in and help them be more successful running their “personal business” within your store.
- July 2019 – Some Words of Wisdom About How to Be Successful – One of the leading authorities on how to be successful was Zig Ziglar. Throughout his career he delivered countless presentations designed to both educate people about how to succeed and motivate them to try harder to make it happen. I saw him 25 years ago and his words still ring true today. Here are my thoughts about some of the main points he made about how to achieve success.
- August 2019 – Why Some New Retail Innovations May Fail in Your Store – Implementing an innovative new system, process or procedure in your store is not always as easy as it sounds. People resist change and unless you follow the correct steps and make all the necessary efforts, there is a good chance you could fail to get it done. Here are a few ideas that could help make the difference between your success or failure.
- September 2019 – Selling WITH the Internet Instead of AGAINST It – Has our fear of competition from the Internet caused us to miss an opportunity to use it as a tool to help our customers find what they are looking for? If most consumers start their search online, how can we incorporate it into our process to help them find what they want and get it? Here are some thoughts about where the Web is going and how it might be a good sales process asset for us.
- October 2019 – Turning Staff Downtime into Sales Uptime! – What are your staff members doing when they aren’t working with customers on the selling floor? Making personal calls? Shopping on the Internet? Cruising the Web? Napping? Chatting? Arguing with each other? The fact is some or all of these staff activities go on daily in most stores. It is the old cliché about idle hands. Here are some thoughts and a recommended activities list to help you turn unproductive staff downtime into productive sales uptime!
- November 2019 – The Battle to Get |Today’s Consumers Attention – Getting your message out to today’s busy consumers is getting tougher to do. They are bombarded with information about buying opportunities and their attention span has shrunk considerably over the last 20 years. Take a look at one way the big online retailers may be breaking through the clutter to reach their targeted audience. If you need any further advice or help with your plan or these “projects”, please feel free to contact me at: firstname.lastname@example.org. You can find the Home Furnishing Business archive of past issues at: http:// furniturecore.com/Default.aspx?tabid=676.
As always, the furniture industry is greatly influenced by the population. As can be seen from the prime furniture buying population graphic, the Baby Boomers are fading away while Generation X is beginning to provide the growth until the much anticipated Millennials arrive.
While the prime furniture buying population has been diminishing, the amount of average household purchases has increased over 40% in the last five years, exceeding the growth of other home furnishings products. The consumer spending graphic presents the spending by product category. The consumer expenditure has resulted in a $300+ billion home furnishings industry of which furniture (consumer durables) represent 42% ($129.9b). Those other product categories typically not sold by traditional furniture retailers may become important in the future. Generation of traffic by these other products may be important to the more postponable furniture category.
There is an ongoing tug of war between furniture stores and home furnishing stores, but with both losing out to other distribution channels as can be seen from the graphic.
WHAT ABOUT YOUR CONSUMER?
The furniture consumer today is much more diverse as the Baby Boomers dominance has given way to Generation X and anticipating the much discussed Millennial.
The most important consumer is your consumer. In the last decade, what was a simple process of good/better/best has migrated to retail experience. The traditional furniture store is battling and trying to serve all consumers while lifestyle retailers, such as Restoration Hardware, are focused on a narrow band of consumers.
The first step is profiling the consumer that you are selling, or more important, those you are not selling. To do that we tap into FurnitureCore, the research arm of Home Furnishings Business. The graphic below provides the output from FurnitureCore’s consumer segmentation application illustrating the prime consumers.
To execute, this information must be drilled down to the market/store/product level.
The wide range of customer demographics can be bett er explained with an industry analysis of purchase price points. With all of this, it is understandable that the consumer has rushed to the bott om in terms of price. When almost 25% of all sofa (units) purchased this year were less than $399 at retail, we see the magnitude of the problem.
Lifestyle is important and is usually measured by psychographic cluster. Psychographics transcend demographics and focus on how the consumer lives and on the activities in their lives.
Using this concept in direct mail and email marketing can produce signifi cant results. The graphic from FurnitureCore – CONSUMER SEGMENTATION – illustrates the concept.
Beyond demographic diversity is ethnicity. While retailers have emerged that cater to certain ethnic groups, such as FAMSA, for the most part all groups are integrated into the total retail focus. However, a retailer should check their appeal to all groups. Business intelligence today allows a measure of ethnic concentration. FurnitureCore’s Consumer Segmentation application provides an ongoing measure on page 16.
What is the Consumer’s Buying Process? Solving the consumer conundrum often seems like searching for the Holy Grail for retailers. Opinions on consumer trends tend to be all over the map, but most observers agree that furniture purchases today involve much more study and research than in the past.
There are many demands on the household incomes that leave only a small portion of disposable income. The line blurs between needs and wants when it comes to expenditures, such as a car, computer, communication, leisure travel, and fi nally, furniture. This is where rationalization begins. The decider is the att itude that the consumer has toward decorating and home furnishing. The range is from “home furnishings are not a consideration” to “my home furnishings must communicate who I am and refl ect a sense of current style.” The fact is that more than 50% of consumers have a positive inclination towards home furnishings. The graphic on the next page illustrates.
There are many indicators that start the consumers on the road to the purchase. Some are life changing events, such as marriage or divorce. Others are life events like a recent move or the addition of a second home. Others, such as remodeling, redecorating, or desire for new furniture, are planned and anticipated. The fi nal indicator is replacement, which is a signifi cant number today (over 40%). The industry has created its own obsolesce factor in the last decade with a replacement factor 4x what it was 20 years ago to the chagrin of the Generation X population that complain of purchasing three sofas since their fi rst household while recalling the furniture of their childhood as being more substantial.
In a household, someone has to get the process started to buy new furniture. Based upon a new FurnitureCore national survey, it is still the female that has the inspiration. Having the idea is followed by the female performing the initial scouting trip to identify the retailer to shop.
However, after all the shopping and research on the internet, the purchase decision is a joint decision.
With the time starved consumer, the shopping process is fast with completion within two weeks for more than 50% of the purchases. Because of the research on the Internet, the number of stores shopped has been greatly reduced to just over two stores shopped per purchase. This change has caused signifi cant concern for the retailer — why is the traffi c down over 10% nationally in the past fi ve years? However, a more confi dent consumer produces higher close rate and larger average ticket.
The shopping process is very proactive, “visiting the store” or “research on the internet” are the fi rst two steps, equally distributed as number one and number two. This activity is followed by input from friends and research in printed materials. Far down the list is designers or advertisers.
The choice of retailers and corresponding retailer experience are extensive. However, for now the traditional furniture retailers’ single store and regional chains dominate, the Internet follows closely to being considered.
The furniture consumer has moved away from destination stores to stores closer to their homes. This change has resulted in more stores per households in a market, thus leading to smaller stores located in more expensive real estate areas. A signifi cant change in the furniture retailer business model is combining occupancy and advertising expense considerations.
The furniture retailers are doing a good job of accomplishing a positive experience for the consumer with all factors rated above average.
HOW OTHER RETAIL OBSERVERS PERCEIVE FURNITURE
Observers of consumer trends say the same disruptors affecting a broad range of retail purchasing decisions are also affecting furniture. These are affecting how people make decisions and how they shop.
Michael Solomon, a consumer behavior expert and thought leader in marketing and advertising, says would-be furniture buyers are doing much more research than in the past. This includes reading blogs or watching Joanna Gaines on HGTV’s remodeling show, “Fixer Upper.” The result is consumers are getting a lot of feedback in advance of making purchasing decisions.
“For 50 years or so there has been a tremendous amount of research on the steps that people go through when they make an important decision, which furnishings usually are,” Solomon says. “We know it is a linear sequence that people go through that begins when they recognize a need, all the way through the purchase itself, and then after the purchase, where they evaluate the quality of that decision, and how that affects future decisions. What we are seeing is that we are entering a period now where we have what some people call social selling, where a lot of these basic assumptions get turned on their heads.”
Solomon, who is also a professor of marketing at Saint Joseph’s University in Philadelphia, Pa. says, for example, people are doing a lot of research before the fact prior to making not only large purchases, but less important decisions such as where to eat.
“Traditionally, someone would decide that they want to buy a couch and you would shop a few stores, find what you like, and bring it home. Then if you like it and your friends tell you they like it, you will go back to the same store the next time. Mostly it was an individual decision or maybe a joint decision by a married couple. That’s not the case anymore. What we are seeing now is that people are working a lot harder, even though there are so many more choices, and so many timesaving apps and things like that. When you add it all up, more time is spent to research and look into decisions, to look into options, before they make the decision.”
Oracle Retail says consumers are increasingly open to whatever gets orders to their door the fastest, with more than 90% seeking free one-day delivery by whatever means is fastest, including drone, driverless car or a messenger. This is more than double (43%) the number of consumers who felt these delivery mechanisms would be “awesome” when asked just last year.
Most consumers recognize that furniture is not a “hamburger,” and it requires a little longer lead time. Per the FurnitureCore survey on the next page, more than 40% received delivery within a week, well within their desired time.
Solomon says it has been his experience that retailers are some of the most riskaverse people he’s ever met. “The ones who are dying in the retail apocalypse are the ones who are resisting change, who are not willing to take risks, because what they have to do is totally reframe their perspective to offer a customer experience that sells product,” he says.
Successful retailers are enhancing the shopping experience. As Solomon says, they have to give people a reason to get out of their pajamas and actually go to the stores. “Some people say brick and mortar is dead but I very much do not believe that,” he says. “But I do believe that a store is not just a place to inventory or display your furniture, your merchandise. A store should not just be treated like a warehouse. A store is an opportunity to create an experience. One of the biggest trends today is marketing as customer experience. It’s imperative to track the entire customer journey that starts well before you enter the store and finishes well after you’ve left the store. But that in-store experience is really crucial, especially with home furnishings. Being able to experience the product as you would experience it at home is a very important aspect.”
Solomon says consumers might post some photographs of furniture that they think they might want to buy, and wait to get reactions from their Facebook or other social network friends prior to making that decision. That represents a big departure from traditional wisdom about how consumers make decisions.
“It’s extremely important to retailers because when people go to a physical store to look at or order their furniture, they’ve already made up their mind prior to walking in the store,” Solomon says. “They are basing it on feedback they are gett ing from their social networks, or what bloggers are writing, reviews of various kinds. Some retailers are more aware of this than others. That doesn’t mean they can’t sway that decision, but the challenge for retail stores is very diff erent from what it used to be. They think they have a naïve shopper coming in who isn’t very knowledgeable about the furniture, and they think they are going to educate them on the options they have in their store.
They are going to be very sadly mistaken.” Sucharita Kodali, an analyst with Forrester, says in every retail category, more consumers are purchasing online. However, she says furniture is one of the least penetrated online, citing 2018 Forrester fi gures that had about 9% of furniture being sold online. She says the higher the price point, the more likely consumers are to buy in-store. “Looking online is a convenient way to fi nd what you are looking for,” Kodali says. “That’s why you see the percentage of online sales increasing.”
Solomon cites the example of mattress fi rm Casper, which allows customers to take a nap on the matt resses in the store. He says companies sell pillows, but people buy sleep.
“What that means is that a lot of companies still don’t seem to understand the fun damental difference between the attributes of a product and the benefits of a product,” he says. “They are selling the attributes but customers are buying the benefits.”
REI is another example. The outdoor retailer allows the customer to try products in the store and they even take customers on camping trips to show them how to use the products in a real environment. “That’s a very basic example of what I’m talking about. Understanding the customer experience is really key, and definitely understanding from the customer’s point of view, not from the salesperson’s or manager’s point of view. When you change the lens through which you view that kind of experience to focus on what if feels like to the customer, it’s a completely different perspective.”
So, what advice does Solomon offer furniture retailers? He suggests they get out of the “warehouse” business and move into the true retail business, which he says is about providing enough added value to motivate people to get off the Internet and actually come in to have a physical encounter.
Consumer Expectations and the Value-adds for Celebrity Designer Furniture Collections
Whether today’s consumer is buying food or furniture, fashion or accessories, there’s something singular they are seeking: authenticity. In the case of Rachael Ray Home by Legacy Classic Furniture, that authenticity is more apparent because of Rachael’s vibrant “whatyou-see-is-what-you-get” personality, said Don Essenberg, president of Legacy Classic. “Whether it’s a dinner Rachael is preparing, a TV interview she is doing or furniture she is designing, it reflects her personality and resonates with her fan base as authentic,” he said. Her design partner Michael Murray agrees. “Rachael Ray Home is Rachael telling her personal story of design through her furniture partners, Legacy Classic and Aria Upholstery. Those who know Rachael know she would never just slap her name on something. It has to be her truth.”
In truth, all the collection ideas begin with Rachael, and “she adds tremendous creative value because she is involved in every detail of the design,” said Essenberg. “She approves every sketch, every finish, every piece of hardware and even the hardware finish.” Rachael’s creative input has borne fruit, as Essenberg says. “Each collection we’ve introduced has been more successful than the one before. Rachael Ray Home, first introduced in 2016, is today stronger than ever.”
As an international television personality and author, Rachael has a tremendous consumer franchise, but addressing changing furniture design and lifestyle trends is more art than science and based more on her personal life and experience than on research or focus groups. “Rachael hears feedback from all walks of life and very much lives the same way her audience does,” Murray says. “Therefore, what works for her generally works for her audience.” Rachael puts it this way, “I like to design things that solve problems, whether it is an oval pasta pot or a USB port in the back of a nightstand.”
One of Legacy Classic’s top Rachael Ray Collections, Monteverdi, sprung out of Rachael’s love for the Tuscany region of Italy, relates Essenberg. “She’s in love with Tuscany. She got married there and visits a lot. So she came to us with the idea of a collection inspired by Tuscany. It became a rustic casual collection with planked tops and a sunbleached Cypress finish. It all began with her love of the region and the way it makes people feel.” Another appeal that comes with the Rachael Ray brand is her “approachable” point of view, Essenberg adds. “Her furniture is approachable, not stuffy. You could use her dining table for breakfast on a Wednesday or for the family Thanksgiving dinner.”
Her newest collection for Legacy Classic, Milano, is “fashion-forward and fearless,” Murray said. “It is fearless, but it keeps her most important (brand) promise. “My most important promise is, ‘You don’t have to be rich to live well,’” Rachael says.
That subliminal promise becomes a competitive edge on the retail sales floor as it attracts and draws in the consumer to experience an exceptional – yet accessible – life through Rachael Ray Home, said Essenberg.