Traditional furniture and home goods retailers have been hard-hit by the pandemic. Pier 1 Imports is soon to be out of business, while other major chains like Sur La Table and Bed Bath and Beyond have been forced to close numerous locations.
Of course, people still need to furnish their homes — maybe now more than ever — so naturally they are shopping more online.
CivicScience has been following the general transition to online furniture buying, seeing significant growth since 2018. A recent survey of more than 5,100 U.S. adults shows that the number of people who say they’ve purchased furniture seen only online has reached 35%, the highest adoption rate yet.
Although online buying hasn’t grown much since June, the trend is still holding steady overall. With this in mind, CivicScience looked further into buyer patterns behind the numbers.
How Brands Are Faring
Recent surveying found 36% of U.S. have used the online-exclusive retailer Wayfair. Twelve percent of those surveyed reported making purchases from Wayfair within the past three months, compared to 11% in June.
That may not be the kind of growth that investors were expecting for the company, further showing how unpredictable and volatile retail is right now. However, the online-only model gives them a leg up during this time compared to businesses that primarily depend on in-store shopping.
Looking at brand favorability, IKEA ranks highly at 27%. However, being a brick and mortar, IKEA’s e-commerce storefront has been struggling to adapt to greater online demand.
Overstock.com ranks lowest of the three in terms of favorability, coming in at 12%. However, tracking hasn’t shown any noticeable favorability changes in the past year.
Interestingly, the data reveal that those who bought from Wayfair for the first time in the past three months (making up 4% of respondents) are significantly less likely to feel comfortable returning to shop in stores anytime soon, compared to previous buyers and non-buyers. Just 19% of first-time buyers would return to shop in stores (not including for groceries) within the month, compared to 37% of previous buyers.
This could indicate that new buyers are potentially more attracted to purchasing goods online due to health concerns, as opposed to necessity, convenience, or personal preference.
AR App Adoption
When it comes to shopping for furniture and home goods online, adoption of mobile apps that use augmented reality (AR) to view how an item would look in your space has been slow-going. Yet, general usage and popularity of AR apps are expected to grow as more retailers compete digitally.
The survey shows that 9% of adults have already used AR apps, such as Amazon AR and IKEA Place.
Adoption is certainly higher among online furniture buyers, while intent to use AR apps is highest among those who also intend to buy furniture online. Of course, there is room to grow — awareness of AR apps is also lower among these groups than it is among those who haven’t bought or who don’t plan to buy furniture online.
Apps should theoretically be a natural fit in today’s current furniture retail market. Among people who buy furniture (whether in store or online), websites are the leading way of sourcing furniture, more so than catalogs, magazines, or going to stores (“other”). Adding home furnishing blogs and social media into the equation, online channels account for more than 50% of the ways people get info when planning to buy furniture.
Renters vs. Homeowners
According to the survey findings, online furniture buying is now more popular with renters than homeowners. While ranking more equally in the past, there has been a shift toward renters over the past six months.
Age is likely part of the reason behind this, with Millennials being more likely to rent and more likely than both Gen Z or Baby Boomers to purchase furniture online.
Yet it’s hard to say for how long — online furniture buyers are also more likely to plan to purchase property within the next 6 to 12 months.
With more young first-time homebuyers on the market taking advantage of low interest rates, we may expect to see increased online furniture buying to furnish new homes. And the online furniture retailers who offer free shipping would probably have an advantage, such as Wayfair. The survey shows that online buyers highly value free shipping, and more than half of those who intend to buy online also rate free shipping as very important.
What lies ahead for furniture retail? Will shoppers eventually return to stores or will e-commerce become the main way we buy furniture in the future? Stay tuned for more insights as we continue to track this and other trend adoption rates.