The first ever RetailX Homeware Sector Analyst Report has landed! It delves into the changes, key players and new trends that have emerged – particularly since the pandemic hit and threw the market on its head.
Today, I wanted to zoom in on a few macroeconomic events which have significantly shaped the homeware sector and perhaps changed it for good.
If you’re eager to learn more about the wider homeware landscape – you can download the full report here.
We can’t begin without addressing the elephant in the room – Covid-19. As much as we’re all sick of hearing about the pandemic (I know I am), it is important to discuss its enduring impact on the retail sector. When it comes to the homeware sector, coronavirus was initially bad news; with the first lockdown and closure of physical stores leading to a plummet in sales.
However, as the year continued, a new demand for home decor emerged as shoppers redesigned their living spaces to accommodate working from home, home-schooling and everything in between. This trend is set to see a large bounce-back in 2021, before returning to a more normal level of activity in 2022 and beyond.
As the home started to develop into a multi-purpose space for many, the sector saw changing shopping habits and a shift in the type of homeware being purchased. In addition to the usual demand for sofas, beds and wardrobes; there has also been a kean uptake in:
Home office furniture
In 2020, the need to create a comfortable working environment was a top priority for many consumers as they adapted to working from home as the norm. Some took this beyond a functional desk and swivel chair – embellishing their homes with everything from new kitchen counters, to fake bookcases to impress colleagues on Zoom. Yes, really…
Nonetheless, sales of seating products have shown most growth in recent years in both volume and value terms, with sales reaching £68m in 2020, or 40% of the market.
Some people found being amidst a global pandemic, well, pretty stressful. This was reflected in the increased sales of wellness and wellbeing products such as calming candles, essential oils for diffusers and potpourri. According to Kantar, the wellbeing or ‘self-care’ category jumped 29% in October 2020, while research by Technavio says that the value of the market was at $5.40bn in 2019 and it is expected to grow to $7.22bn by 2024.
Environmental consciousness and upcycling
The growing interest in the green economy is going to have a huge impact on the homeware sector as more consumers look to buy items that are ethically and sustainably sourced, as well as increasingly looking for items that are upcycled or made from recycled materials. This is going to become a big driver in the sector and will provide a platform for new entrants that can tap into this, while more established retailers need to look to form partnerships to enter this sector.
On the whole, homeware retailers have massively capitalized on the global pandemic, which essentially created a new audience of stay-at-home shoppers wanting to revamp their all-in-one personal/office/gym/leisure space or rather, their lockdown home. This has seen an uptick in the market, which has not only forced many homeware retailers to rethink their digital transformation timeframe, but has also seen many other retailers looking to take a slice of the market.
For example, many fashion, DIY and sports retailers spotted the gap in the market and have started to sell their own branded homeware items. Many of these are pureplay online retailers who have the tools and strategy under their belt to potentially shake up the homeware market.
The other interesting new entrant is Amazon, which has long sold homewares via third-parties in its site. During 2020 and into 2021, it has invested heavily in tools designed to make the process of buying homewares online even easier.
These competitors are definitely ones to watch on the homeware scene!
All analysis from this article is rooted in the RetailX Homeware Sector Analyst Report. For further insight into the homeware sector, including regional variants, growth vectors and new technology – get your copy today!