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Description

Description

“Consumer spending on furniture continues to grow, but it’s a fragmented and challenging sector to operate in. Physical stores remain a vital part of the purchase journey but growth in digital capabilities has fundamentally changed the way they’re used and the in-store experience needs to be adapted to reflect this.”
– Thomas Slide, Senior Retail Analyst

This report looks at the following areas:

  • Competing in a challenging sector
  • The changing but ever-present role of the store
  • Latest tech transforms the way people shop for furniture

What's included

What's included

Table of contents

Table of contents

  1. Overview

    • What you need to know
      • Products covered in this report
      • Executive Summary

          • The market
            • Spending on furniture continues to grow
              • Figure 1: Consumer spending on furniture, 2013-2023
            • Living and dining furniture accounts for almost half the market
              • Figure 2: Furniture market segmentation, 2017
            • Growing number of households underpins growth
              • Figure 3: Number of UK households, 2008-2017
            • Companies and brands
              • IKEA continues to expand but investment hits profits
                • Argos shake-up hits furniture sales
                  • Tesco withdraws while Amazon steps up
                    • A very fragmented market
                      • Figure 4: Market shares of furniture retailers, 2017
                    • Alternative realities make furniture shopping easier
                      • Total advertising expenditure increases 5.8% in 2017
                        • A lack of clear difference
                          • The consumer
                            • Average spend increases
                              • Figure 5: What they spent on furniture in the last 12 months, May 2017 and May 18
                            • All age groups buy living room furniture
                              • Figure 6: Rooms they buy for, May 2018
                            • In-store and online used in equal measure
                              • Figure 7: How they shop for furniture, May 2018
                            • 81% of furniture buyers browse online
                              • Figure 8: How they browsed for furniture in the last 12 months, May 2018
                            • IKEA and Argos lead a fragmented market
                              • Figure 9: Where they shopped for furniture in the last 12 months, May 2018
                            • A reputation for quality is the most important factor
                              • Figure 10: Factors important in deciding where to shop for furniture, May 2018
                            • The changing role of the store
                              • Figure 11: Behaviours related to shopping for furniture, May 2018
                            • Difficulty in judging quality online
                              • Figure 12: Attitudes towards shopping for furniture, May 2018
                            • What we think
                            • Issues and Insights

                              • Competing in a challenging sector
                                • The facts
                                  • The implications
                                    • The changing but ever-present role of the store
                                      • The facts
                                        • The implications
                                          • Latest tech transforms the way people shop for furniture
                                            • The facts
                                              • The implications
                                              • The Market – What You Need to Know

                                                • Spending on furniture continues to grow
                                                  • Living and dining furniture accounts for almost half the market
                                                    • Growing number of households underpins growth
                                                      • Housing transactions start to slow
                                                        • Inflation on furniture and furnishings surges in 2017
                                                          • Retail credit market continues to grow
                                                          • Market Size and Forecast

                                                            • Spending on furniture continues to grow
                                                              • Figure 13: Consumer spending on furniture, 2013-2023
                                                              • Figure 14: Consumer spending on furniture, 2013-2023
                                                            • Forecast methodology
                                                            • Market Segmentation

                                                              • Kitchen and bathroom sectors more exposed to market uncertainty
                                                                • Figure 15: Furniture market segmentation, 2013-2017
                                                            • Online

                                                              • Online sales account for 18% of furniture sales
                                                                • Sainsbury’s now the largest online retailer of furniture
                                                                  • Figure 16: Estimated shares of online spending on furniture, 2017
                                                              • Market Drivers

                                                                • Continued growth in the number of households
                                                                  • Figure 17: Number of UK households, 2008-2017
                                                                  • Figure 18: Average household size, 1996-2017
                                                                • Housing transactions start to slow
                                                                  • Figure 19: Number of residential housing transactions over £40,000, 2008-2017
                                                                  • Figure 20: Monthly change in the number of residential housing transactions over £40,000 compared to the previous year, January 2017-May 2018
                                                                • Inflation on furniture and furnishings surges in 2017
                                                                  • Figure 21: Inflation, 2008-2017
                                                                  • Figure 22: Inflation, May 2017-May 2018
                                                                • Consumer confidence recovers in 2018
                                                                  • Figure 23: Consumers’ confidence in the state of the finances and their finances compared to the previous year, January 2016-June 2018
                                                                • Intention to spend on the home increases
                                                                  • Figure 24: Spending on the home, actions and intentions, April 2015-June 2018
                                                                • Retail credit market continues to grow
                                                                  • Figure 25: Forecast of the value of retail store and online credit, 2012-22
                                                              • Companies and Brands – What You Need to Know

                                                                • IKEA continues to expand but investment hits profits
                                                                  • Argos shake-up hits furniture sales
                                                                    • A very fragmented market
                                                                      • Alternative realities make furniture shopping easier
                                                                        • 2017 total advertising expenditure up 5.8%
                                                                          • A lack of clear difference
                                                                          • Leading Specialists

                                                                            • IKEA continues to innovate and grow
                                                                              • DFS grows through acquisitions
                                                                                • Uncertainty for the Steinhoff businesses
                                                                                    • Figure 26: Leading furniture specialists’ sales, 2012/13-2017/18
                                                                                  • Operating profits and margins
                                                                                    • IKEA profits hit by investment costs
                                                                                      • DFS profit drops
                                                                                        • Made.com losses stem from international expansion
                                                                                          • Figure 27: Leading furniture specialists’ operating profits, 2012/13-2017/18
                                                                                          • Figure 28: Leading furniture specialists’ operating margins, 2012/13-2017/18
                                                                                        • Stores and outlet data
                                                                                          • Figure 29: Leading furniture specialists’ outlet data, 2012/13-2017/18
                                                                                        • Sales per store
                                                                                          • Figure 30: Sales per store, 2012/13-2017/18
                                                                                      • Leading Non-specialists

                                                                                        • Argos shakeup hits furniture sales
                                                                                          • John Lewis furniture sales continue to grow
                                                                                            • Tesco stops selling furniture
                                                                                              • Amazon makes moves towards the furniture market
                                                                                              • Market Share

                                                                                                  • A very fragmented market
                                                                                                    • Figure 31: Market shares of furniture retailers, 2017
                                                                                                • Space Allocation Summary

                                                                                                    • Space allocation overview
                                                                                                      • Figure 32: Furniture retailers: summary of estimated in-store space allocation, June 2018
                                                                                                    • Detailed space allocation estimates
                                                                                                        • Figure 33: Furniture retailers: detailed space allocation estimates, June 2018
                                                                                                    • Innovation and Launch Activity

                                                                                                      • Amazon launches first own furniture brand
                                                                                                        • Try-before-you-buy
                                                                                                          • Figure 34: IKEA Place app
                                                                                                        • Local sourcing
                                                                                                          • IKEA debuts streetwear designer collection of home accessories
                                                                                                            • Figure 35: IKEA: Spänst collection, wardrobe and skateboard, June 2018
                                                                                                          • Micro-living furnishings
                                                                                                            • Making it easier to find specific furnishings
                                                                                                              • Figure 36: Wayfair Search with Photo
                                                                                                            • Creating a starting point to searching for a sofa online
                                                                                                            • Advertising and Marketing Activity

                                                                                                              • 2017 total advertising expenditure up 5.8% year on year
                                                                                                                • Figure 37: Total above-the line, online display and direct mail advertising expenditure on furniture, 2014-17
                                                                                                              • DFS is the biggest advertising spender …
                                                                                                                • Figure 38: Total above-the line, online display and direct mail advertising expenditure on furniture, by retailer, 2014-17
                                                                                                              • … and accounts for over a fifth of total sector advertising spend
                                                                                                                • Figure 39: Share of total above-the line, online display and direct mail advertising expenditure on furniture, by retailer, 2017
                                                                                                              • TV attracts the lion’s share of advertising spend
                                                                                                                • Figure 40: Total above-the line, online display and direct mail advertising expenditure on furniture, by media type, 2017
                                                                                                              • Leading advertisers favour TV over any other media type
                                                                                                                • Figure 41: Total above-the line, online display and direct mail advertising expenditure on furniture, by retailer and media type, 2017
                                                                                                              • Campaign highlights
                                                                                                                • DFS puts speed of home delivery and comfort in the spotlight
                                                                                                                  • Dreams pushes UK manufacturing credentials
                                                                                                                    • Hollywood actor fronts Sofology’s ‘Feel at home on the sofa you love’ campaign
                                                                                                                      • Relaxing qualities of the living room
                                                                                                                        • Harveys pushes customisable sofa collection
                                                                                                                          • Nielsen Ad Intel coverage
                                                                                                                          • Brand Research

                                                                                                                              • Brand map
                                                                                                                                • Figure 42: Attitudes towards and usage of selected brands, April 2018
                                                                                                                              • Key brand metrics
                                                                                                                                • Figure 43: Key metrics for selected brands, April 2018
                                                                                                                              • Brand attitudes: Oak Furniture Land worth paying more for
                                                                                                                                • Figure 44: Attitudes, by brand, April 2018
                                                                                                                              • Brand personality: IKEA makes furniture shopping fun
                                                                                                                                • Figure 45: Brand personality – macro image, April 2018
                                                                                                                              • DFS risks being seen as impersonal and overrated
                                                                                                                                • Figure 46: Brand personality – micro image, April 2018
                                                                                                                              • Brand analysis
                                                                                                                                • IKEA’s reputation for innovation and value makes it popular with the young
                                                                                                                                  • Figure 47: User profile of IKEA, April 2018
                                                                                                                                • Oak Furniture Land delivers a quality message
                                                                                                                                  • Figure 48: User profile of Oak Furniture Land, April 2018
                                                                                                                                • DFS: trusted but lacks differentiation
                                                                                                                                  • Figure 49: User profile of DFS, April 2018
                                                                                                                                • Harveys is authoritative but lacks excitement
                                                                                                                                  • Figure 50: User profile of Harveys Furniture, April 2018
                                                                                                                                • Furniture Village lacks trust and differentiation
                                                                                                                                  • Figure 51: User profile of Furniture Village, April 2018
                                                                                                                              • The Consumer – What You Need to Know

                                                                                                                                • Average spend increases
                                                                                                                                  • All age groups buy living room furniture
                                                                                                                                    • In-store and online used in equal measure
                                                                                                                                      • 81% of furniture buyers browse online
                                                                                                                                        • IKEA and Argos lead a fragmented market
                                                                                                                                          • A reputation for quality is the most important factor
                                                                                                                                            • The changing role of the store
                                                                                                                                              • Difficulty in judging quality online
                                                                                                                                              • What They Spent

                                                                                                                                                • Shift to higher value purchases over the past year
                                                                                                                                                  • Figure 52: What they spent on furniture in the last 12 months, May 2017and May2018
                                                                                                                                                • Spending peaks among 25-34 year-olds
                                                                                                                                                  • Figure 53: Spending on furniture in the past year, by age group, May 2018
                                                                                                                                                • And in the period a year after moving in
                                                                                                                                                  • Figure 54: Spending on furniture in the past year, by years lived in their current home, May 2018
                                                                                                                                              • Rooms They Buy For

                                                                                                                                                • Living room and bedroom purchases dominate
                                                                                                                                                  • Figure 55: Rooms they buy for, May 2018
                                                                                                                                                • Bedroom becomes less of a focus with age
                                                                                                                                                  • Figure 56: Rooms they buy for, by age group, May 2018
                                                                                                                                              • How They Shop for Furniture

                                                                                                                                                • In-store and online level-pegging
                                                                                                                                                  • Figure 57: How they shop for furniture, May 2018
                                                                                                                                                • Online shopping more popular among the young
                                                                                                                                                    • Figure 58: How they shop for furniture, May 2018
                                                                                                                                                  • Shopping in-store increases with spend
                                                                                                                                                    • Figure 59: How they shop for furniture, May 2018
                                                                                                                                                • How They Browse for Furniture

                                                                                                                                                  • 81% browse online
                                                                                                                                                    • Figure 60: How they browsed for furniture in the last 12 months, May 2018
                                                                                                                                                  • Almost half of under-35s use smartphones to look for furniture
                                                                                                                                                    • Figure 61: Browsing for furniture by smartphone, by age group, May 2018
                                                                                                                                                  • 76% of in-store purchasers browsed online
                                                                                                                                                    • Figure 62: How in-store shoppers browsed for furniture, May 2018
                                                                                                                                                • Where They Shopped

                                                                                                                                                  • Huge number of furniture retailers
                                                                                                                                                    • The online pureplays remain niche
                                                                                                                                                      • Figure 63: Where they shopped for furniture in the last 12 months, May 2018
                                                                                                                                                    • IKEA surges ahead …
                                                                                                                                                      • … while Argos drops behind
                                                                                                                                                        • Amazon continues to expand
                                                                                                                                                          • Homebase troubles impact furniture business
                                                                                                                                                            • Figure 64: Where they shopped for furniture in the last 12 months, May 2017 and May 2018
                                                                                                                                                          • IKEA and Amazon battle for the middle ground
                                                                                                                                                            • Figure 65: Where they shop for furniture, by age and socio-economic group, May 2018
                                                                                                                                                          • Smartphone browsing peaks among eBay shoppers
                                                                                                                                                            • Figure 66: Browsing online via a smartphone, by where they shopped, May 2018
                                                                                                                                                        • Important Factors in Deciding Where to Shop

                                                                                                                                                          • Quality is the most important factor
                                                                                                                                                            • Importance of reputation opens the way for branded stores to expand
                                                                                                                                                              • Unique styles can make all the difference
                                                                                                                                                                • Figure 67: Factors important in deciding where to shop for furniture, May 2018
                                                                                                                                                              • Credit appeals to young, less affluent households
                                                                                                                                                                • Showrooms hold less appeal to the young
                                                                                                                                                                  • Figure 68: Factors important in deciding where to shop for furniture, by age and socio-economic group, May 2018
                                                                                                                                                                • Price, speed and credit are more important to online shoppers
                                                                                                                                                                  • Figure 69: Factors important in deciding where to shop for furniture, by how they shopped for furniture, May 2018
                                                                                                                                                                • IKEA shoppers look for unique styles and a reputation for quality
                                                                                                                                                                  • Figure 70: IKEA shoppers’ important features in deciding where to shop, May 2018
                                                                                                                                                                • John Lewis shoppers value quality, style and UK-made
                                                                                                                                                                  • Figure 71: John Lewis shoppers’ important features in deciding where to shop, May 2018
                                                                                                                                                                • Credit appeals to DFS shoppers
                                                                                                                                                                  • Figure 72: DFS shoppers’ important features in deciding where to shop, May 2018
                                                                                                                                                              • Shopping Behaviours

                                                                                                                                                                • The changing role of the store
                                                                                                                                                                  • Figure 73: Behaviours related to shopping for furniture, May 2018
                                                                                                                                                                • Young people most likely to buy on credit
                                                                                                                                                                  • Figure 74: Proportion saying they bought furniture on credit, May 2018
                                                                                                                                                                • B&Q shoppers are most likely to have regretted a purchase
                                                                                                                                                                  • Figure 75: Agreement with the statement: ‘I purchased an item of furniture I later regretted’, by where they shopped for furniture, May 2018
                                                                                                                                                              • Attitudes Towards Shopping for Furniture

                                                                                                                                                                • Stores essential to judge quality …
                                                                                                                                                                  • … but high-pressure selling tactics can deter people
                                                                                                                                                                    • Figure 76: Attitudes towards shopping for furniture, May 2018
                                                                                                                                                                  • Augmented reality app holds interest for younger shoppers
                                                                                                                                                                    • Figure 77: Interest in smartphone app to show how a piece of furniture would look in the home, by age and gender, May 2018
                                                                                                                                                                  • Economic uncertainty most likely to impact 25-34-year-olds
                                                                                                                                                                    • Figure 78: Concerns about the economy have led me to delay buying a large item of furniture, by age, May 2018
                                                                                                                                                                • Appendix – Data Sources, Abbreviations and Supporting Information

                                                                                                                                                                    • Abbreviations
                                                                                                                                                                      • Consumer research methodology
                                                                                                                                                                      • Appendix – Market Size and Forecast

                                                                                                                                                                        • Forecast methodology

                                                                                                                                                                        About the report

                                                                                                                                                                        This report will give you a complete 360-degree view of your market. Not only is it rooted in robust proprietary and high-quality third-party data, but our industry experts put that data into context and you’ll quickly understand:

                                                                                                                                                                        • The Consumer

                                                                                                                                                                          What They Want. Why They Want It.

                                                                                                                                                                        • The Competitors

                                                                                                                                                                          Who’s Winning. How To Stay Ahead.

                                                                                                                                                                        • The Market

                                                                                                                                                                          Size, Segments, Shares And Forecasts: How It All Adds Up.

                                                                                                                                                                        • The Innovations

                                                                                                                                                                          New Ideas. New Products. New Potential.

                                                                                                                                                                        • The Opportunities

                                                                                                                                                                          Where The White Space Is. How To Make It Yours.

                                                                                                                                                                        • The Trends

                                                                                                                                                                          What’s Shaping Demand – Today And Tomorrow.

                                                                                                                                                                        Please Note: This is a sample report. All of the figures, graphs, and tables have been redacted.

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