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From Home Furnishing Business

Numerology

90% — American adults have a cell phone

58% — American adults have a smartphone

Pew Research

 

45 — Number of times a day millennials check their smartphones

MarketingLand.com

 

74% — Online adults using social networking sites

Pew Research

78.8 years
Life expectancy in the U.S.
81.2 for women; 76.4 for men
Centers for Disease Control and Prevention

 

Small businesses created 63% of the new jobs between mid-2009 and the beginning of this year

U.S. Small Business Administration

 

28% of the U.S. population lives alone

Euromonitor International

 

6,500 — Number of languages in the world

Infoplease

 

1.2 Billion — Number of people who speak Mandarin Chinese, the world’s most popular language

Infoplease

 

7 years — Length of autumn on Saturn        

NASA

 

$3,800 — average American family savings account balance

Federal Reserve

 

40% — Americans NOT saving for retirement

 

42% — Smartphone users who have redeemed a mobile coupon

Nielsen Co.

Wired for Relevance

By: Powell Slaughter

Consumer awareness of home furnishings’ online presence might be at its highest point ever, and retailers who haven’t done so already should take a hard look at the story they tell in the digital sphere.

Thank the huge amount of press generated by online home furnishings giant Wayfair’s initial public offering last month. Consumers already are using the Internet—via computer or smart phone—to do their homework before hitting your store; and the information you present, how well your digital presence matches your brick-and-mortar experience, and the ease of use can go a long way toward getting you on shoppers’ short list. They want to know as much as they can about your products and services before they even start a conversation.

“All of a sudden there’s a focus on furniture online” said MicroD CEO Manoj Nigam in the wake of the Wayfair IPO. “And the digital age is about being relevant to consumers. What television did in the 1950s (for retailers) the Internet is doing now.

“Your Web site has become your biggest advertising vehicle—it’s your front entrance now; and 25 percent of traffic is now mobile. People expect a consistent experience across multiple sites” no matter what device they use.

DIGITAL RELEVANCE

If you don’t provide the information they seek, an interactive approach to fielding questions, and an online presence friendly to multiple devices, consumers aren’t going to find your store relevant to the way they research and shop for product these days.

It’s more important than ever, for example, to make your online presence mobile-friendly.

“Mobile is overtaking desktops as the primary product-search method,” noted Jesse Akre, senior vice president for e-commerce at MicroD. (See sidebar, “Digital Responsiveness.”) “And the consumer is more and more wanting an experience online that they would get in the store. It’s not just about displaying products, digital is becoming the driver of the consumer experience.”

He suggests retailers looking to relate to consumers online adopt a “Web first” mentality. He identified four keys: pricing products online; merchandising your Web site; ease of communication with the customer; and understanding the impact of reviews.

Some retailers remain reluctant to put prices on their Web site, but Akre said that’s what consumers are demanding. You don’t need to be in e-commerce to show prices on line. The practice of “Web-rooming” practice has made it easier for shoppers to compare prices and do comprehensive research on an important purchase; and retailers must adapt to that highly informed consumer.

The majority of consumers shopping for home furnishings still go into a store to buy—but they want to be armed with as much information as possible before they cross the threshold, Akre said.

“You've been printing prices for years in your advertising,” he said. “Why won't you treat the online marketing opportunity the same?”

Those insistent on holding back on actual pricing might consider offering a range—i.e., “These sofas retail from $400-$500.”

The bottom line for a Web site is getting people into the store, said Dianne Ray, owner, Garden City Furniture in Garden City, S.C.

“We're going to have to stay current with upgrading our Web site, the look, the ease of use. If they have to flounder around on the site, they're out of there and gone,” she said. “We've discussed e-commerce, and if we're going to attract that Millennial customer we're going to have to move on that. Actually, the Web site is important for all generations.”

MERCHANDISING ONLINE

Shoppers will likely see a store’s Web site before they see the store, and retailers should pay close attention to merchandising issues online.

“Have you walked through your store the past week sprucing things up, maybe moving product or working on a display? Sure you did,” Akre said.

A furniture store’s Web site deserves the same attention. Ensure the site gives consumers the same first impression online as they get in your store.

Shoppers entering your store see a layout that you built with your own business considerations in mind. Steer your Web visitors the same way. Think about ranking products online by perhaps best sellers, leading brands or inventory turns.

Take a seasonal approach the way you would in the store: “Company coming for the holidays? Create a dining room to remember.”

Consider the designs and trends you’re focusing on at the store, as well as products with the highest gross margins. Those are the products that you should feature online to entice consumers into the store.

Retailers know how to do this in the store; it’s a matter of translating the same techniques to an online presentation.

Take a look at in-store signage, graphics and logos to ensure they sync with your online presence.

“If a digital impression is made, it has to carry through in the store,” Akre said, pointing to Dick’s Sporting Goods Web site as a good example. “You see the same banner on the Web site that you see in the store.”

Merchandising the site the way you do the store might seem like a big task, but Akre suggested retailers start small.

“Impact one category, say your top five sellers,” he said. “Next week, do your top 10. Just starting will get the wheels spinning as to how you want to do it. Start with the products you want to lead with online.”

EASY TO ASK

How easy is it for consumers to communicate with you online? Do you use live chat, provide a contact number or e-mail? Whichever method you use, fast response is vital.

“People are not going to wait three days for you to get back to them,” Akre said, adding that some shoppers in the store would rather use their phone to ask a question rather than a store employee. If you use QR codes, make sure it goes to a site that will build expectations for the product, not just provide dimensions and such.

“QR is about driving people to information you control,” Akre said.

David Gardner, co-owner at Warrenton Furniture Exchange in Warrenton, N.C., found a way to engage customers looking at information on their mobile by installing a large screen on the sales floor where the retailer can call up products for easier viewing.

“We can do bring all this information to a larger picture so they aren’t squinting at their smartphone,” he said. “Online is bigger than my warehouse, but we’ve found a way to humanize it.”

The best thing about a good online presence is it provides a 24/7 storefront, but that can create communication problems for something like a live chat function.

If a consumer is browsing at home at 10 p.m. and has a question, it’s better to take live chat off-line during non-business hours than to have “nobody at home” to respond to a question.

A strong FAQ section on a retailer’s site can take care of many customer questions with a simple click. Store policies for issues such as credit, delivery, returns, hours of operation and such should be easily available.

Social media, of course, is an area where furniture retailers can interact with customers. But if you are on Facebook, Twitter or other social vehicles, it’s better not to be there than to not stay engaged.

“One large retailer I know hadn’t engaged on Facebook in 30 days,” Akre noted. “But guess who had? A woman was moving to town and wanted a houseful of furniture.”

THE REVIEWS ARE IN

If you were shopping for products on your own part, which would you trust more? A testimonial from a previous customer, or an advertisement? Never underestimate the power of customer reviews. Check out sites such as powerreviews.com or shopperapproved.com to get an idea of what can happen.

“Good and bad reviews are expected,” Akre said. “And they like to see volume as well as a range of comment. It doesn’t happen overnight. That log of reviews has to build one at a time.”

Retailers can solicit reviews, he added. Incentivize along the lines of a percentage off on their next ticket for an honest review, good or bad. Ask customers in the store.

And don’t forget engagement when it comes to reviews. Respond to problem reviews with an apology and a solution.

“Shoppers eat that up,” Akre said.


Retail Details: Forward Motion

By: Powell Slaughter

Sometimes retailers are surprised at what strikes a chord with customers in the communities they serve—the sort of thing that makes a business a local institution.

In Knight Furniture’s case, it was a scale—an antique in front of the retailer’s main store in Sherman, Texas.

“We had a scale in front of our store that’s apparently become a community fixture,” said Joey Gunn, director of advertising and buyer at Knight, who represents the company’s fourth generation of family management. “It’s an old scale from the 1920s or ‘30s. It broke, so we pulled it inside until we could get the part.

“It’s so old that you can’t just go out and find parts for it anywhere, so we had it in back for a while until we could get it replaced.”

Gunn found himself inundated with messages asking where the scale was—apparently a lot of folks liked to stop and check their weight.

“I flirted with the idea of running a ‘save the scale’ sale,” he joked.

It might not have been a bad idea. Knight Furniture indeed is a local institution—dating back to 1912, when the store was founded. Knight operates two namesake stores in Sherman and Gainesville, Texas, on the outer fringe of the greater Dallas area; and an Ashley Furniture HomeStore it opened in Sherman two years ago.

 

CHANGING TIMES, CHANGING MARKET

Knight Furniture was founded 112 years ago by Joey Gunn’s great uncle, J.B. Knight. Back then Dallas was a lot farther away than it is now. While Knight Furniture competes today in a bigger world—metro Dallas—than its founder did, the store still has a “hometown” approach to dealing with customers that works.

“We’re about quality and value, and while that sounds old, you have to remember we’ve been serving this area for over a hundred years,” Gunn said. “We hear about customers buying things here that have become family heirlooms. We’re not going to be the place that sells the $100 sofa they’ll throw away in a year.”

Pretty soon, Knight and every other furniture retailer in metro Dallas will face a well-financed competitor that’s about to make a cannonball into the local pool—Nebraska Furniture Mart’s half-million-plus-square-foot showroom set to open next year.

Gunn actually looks forward to that challenge, since it will put a spotlight on furniture for miles around.

“They have a great organization, and I’ve been to their Kansas City store,” Gunn said. “They will make furniture popular in Dallas, and that’s a good thing, they’re going to make furniture cool—but if furniture’s going to be cool again, you have to be relevant and be part of the conversation.”

That kind of completion had better make retailers in the area pay attention to what they’re doing.

“You can’t get lazy—no matter what you’re telling your customer, they deserve more than that,” Gunn said. “Competition brings everyone up.”

Not only that, Gunn doesn’t think other furniture stores are Knight’s real competition as long as it takes care of its own business.

“The home furnishings industry competes with movie theaters, with maybe buying another car or a boat,” he said.

It’s all about what people have to spend, and with all the options out there, Gunn welcomes anything that puts furniture front-and-center in consumers’ minds.

 

STEPPING UP

All of which is not to say Knight Furniture is just waiting for a rising tide of furniture awareness. The retailer is in the midst of a remerchandising effort at the main Sherman store that will put key categories front and center in the three-story facility.

While bedding sales have run a respectable 18 to 21 percent of revenue, Knight was worried it was losing sales in the category. Right now, it’s moving its bedding department from the third to the first floor in an area designed by Connie Post.

“There were customers who came in here, purchased product and loved us, but never made it to the third floor,” Gunn said. “One of my worst fears is that people buy their furniture here but don’t even know we have bedding. And the Mattress Firm fraternity makes sure those people know they can get it at their stores.”

The Sherman store is on a square in town that gets a lot of foot traffic—and attention, remember the scale?—and Knight is big on window merchandising.

 “We’re always changing what’s in our front window,” Gunn said. “Since we’re on a square, we have a lot of people walking by, so we pay a lot of attention to those front windows.

“We create what we call ‘lifestyle pods’ where we offer a complete look. We change a lot, because all of a sudden that look can get stale, and we aren’t relevant.”

Knight Furniture’s window clings also capitalize on the retailer’s foot-traffic curb appeal.

“We have those themed along lifestyles like ‘Relax’ or ‘Comfort,’” Gunn said. “One of our tag lines for advertising is ‘We’ll make you feel at home,’ so we play to that.”

 

REACHING THE AUDIENCE

Figuring out the new advertising landscape is a challenge.

“Before 2008, you could get your advertising on TV and make sure the whole region saw you,” Gunn said. “Now, a lot of people have Dallas channels, Sherman channels, then you throw in cable and U-Verse.

“We’re still promoting a family feeling, and that it’s about the relationship and not necessarily making the sale. Sometimes we’re so busy selling something that we forgot to make a friend.”

Knight also is latching onto the days that get shoppers shopping. An event like Black Friday wasn’t important to Knight Furniture even a couple of years ago.

“I don’t know if it was because we didn’t have our message out there or that we’re just now catching up with what shoppers are doing in other categories,” Gunn said. “The amount of business we do on non-holidays versus holidays? There’s a lot of water flowing downhill out there, and you can tell when you’re hot and when you’re not.”

 

UP AND COMERS

Joey Gunn, 31, is heavily involved in an industry effort to build bridges among the rising generation of retail and vendor leaders—Next Generation Now.

After working in his family’s business since his warehouse days at age 14, he was very glad to encounter other young folk that wanted to carry on a tradition.

“Five or six years ago, that kind of thing wasn’t important to me, and I wasn’t important to them, but then I got to where I was making decisions here,” Gunn said. “I walked into a room and found a bunch of people with the same problems.”

By dint of age, Gunn and his fellow generation members find their elders looking to them for answers to breaking ground in areas such as e-commerce and social media as it relates to furniture retailing.

“They want us to solve the ‘technology crisis,’ and we’re front and center on that,” Gunn said. “That’s good, but even though I started working in our warehouse when I was 14, as far as being in a decision making role, it’s only been about five years.”

He said his focus is finding out who Knight’s customers are and who’ll they be in the next few decades.

“We’re at a very tricky stage,” Gunn said. “We want new customers, but we can’t lose our base. If we don’t get hold of the ones who are coming, we won’t do well.”

 

Editor's Note: The Evolving Consumer

By: Sheila Long O'Mara

Over the last several Years, the team here at Home Furnishings Business has written much about the consumer and her hot-and-cold relationship with shopping for furniture. We’ve delved into her psyche; we’ve explored her disposable income; we’ve looked at how and where she likes to shop; and, how she wants her home to look, feel and smell.

 

We’ve dug into how retailers communicate with the consumer, and how manufacturers try to connect and help her create the perfect environment for her family and friends through beautiful home furnishings. We’ve connected with her through surveys to find out how she’ll use her newly purchased sofa or dining table or bedroom furniture. We’ve shared in family celebrations of babies and vacation homes.

 

We’ve gathered intelligence into her way of thinking and her way of shopping. We’ve examined her social media preferences and her exploration of furniture on the Internet.

We’ve watched the life stage shift from a one-person, single household to a double-income-no-kids home to a  busy working mother of 2.1 to an empty nester  ready to downsize into a zero-lot-line home. 

 

We’ve seen her adapt with technology and use it to her advantage in uncovering the best deal on a Surya rug or Restonic mattress or Cresent bedroom.

 

The gist is that she (or he — it’s just much less complicated to use one pronoun) is constantly evolving. The life stages are not stagnant; they never have been, and they never will be.

 

The furniture she needs for her first apartment is — and should be — different than what she needs in her late 20s or early 30s. And, that furniture is different than she needs in her 40s and 50s and beyond.

 

That folks, is what we should all continue to hope for. That our target consumer continues to evolve and her tastes and needs change along with her. For that is what keeps this industry churning.

 

Inside this month’s issue, you’ll find detailed information about how retailers are connecting with consumers, data on income shifts and a look at retail models and which ones are faring well.

 

Publisher's Letter: Slowing Down

By: Bob George

A common lament today is the rapid pace of our lives. In our 24/7 world with the multiple ways we have to communicate and keep in touch, life becomes a blur.

Today, a text message substitutes for a phone call; an e-mail, for a conversation; a PowerPoint presentation, for a detailed study. And the pace continues to accelerate. A recent news clip presented research that Millennials are rejecting voice mails, refusing to listen to them, much less return the call.

Our paradigm in the traditional furniture channel is centered on the concept of an up. In this scenario, consumers visit a store excited about the prospect of redecorating their home. They establish a relationship with an experienced sales associate who provides them with decorating ideas taking into account style preferences and current home furnishings trends. The relationship strengthens as consumers make subsequent return visits to create an amazing room. Thus a satisfied consumer becomes a long-term store customer who will return for future home furnishings purchases.

Unfortunately, that model is disappearing. Seventy-six percent of consumers are doing research on the Internet before visiting the store or simply buying from the Internet. We now find a significantly shorter shopping period. For 45 percent of consumers the shopping process is completed in two weeks or less. What constitutes an up today is like a conversation I have with my kids. We exchange words via text or e-mail, but is it really a conversation?

So what’s the problem with the pace of today’s purchasing process?

Simply put, it changes our product into a commodity. One can drink a glass of wine in a gulp or leisurely savor the experience appreciating the bouquet. How do we slow down the consumer enough to appreciate our product?

I can go back to a memory of conducting focus groups for Henredon with Mike Dugan, who was president at the time. As we led consumers through the product groupings, we watched their reactions. We knew the product was a winner within the first minutes by observing how they caressed the products. Later they shared statements like “I enjoy my furniture every day when I walk through my room.” We find these consumer sentiments not only in upper-end brands, but also for brands like Broyhill and Hooker.

What can we do to slow down the process?

Give the consumer something to read – not an e-mail or a 20-second TV spot that flickers quickly by only to disappear from the surface of their minds. You may counter with “no one ever reads”. That may be so, but have we stopped giving them the opportunity to dream about their homes? Look at the latest 600 plus-page Restoration Hardware catalog or Art Van’s inspiring fall catalog or even the magalogs that retailers are producing with our sister company, FurnitureCore.

The consumer still appreciates a well-designed environment. Just go on a delivery and watch the excitement the customer has about the new furniture. At one time, sales associates took the time to visit after the delivery to share in the consumer’s excitement.

Are we too busy to do anything more than send an e-mail, much less a hand-written note? Our challenge at retail is to do something in the store that consumers cannot do online. And what is the manufacturer’s role in this? It is to create product the consumer can appreciate, product based on design, not on bargain pricing.

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