Retail Observer

RETAILOBSERVER.COM JANUARY 2018 42 M y wife and I were recently visiting friends and their granddaughter was spending the weekend, so we all decided it would be fun to order pizza and introduce her to The Wizard of Oz. As Dorothy, the Tin Man, the Scarecrow and, of course, Toto are going through the dark forest they get scared when they hear noises coming from the foliage around them. The Scarecrow wonders if there are any animals there who might be interested in eating things like, um, straw. The Tin Man's like, "Yeah, there are probably lions and tigers and bears out there." Lions and Tigers and Bears, Oh My! Watching this popular scene made my mind fast forward to the furniture industry and the ever- changing landscape we are facing. Distribution channels are changing with traditional channels of independents, regional chains, and department stores being challenged by alternative channels such as the internet, lifestyle stores and mass merchants… oh my. And how do I market to Boomers, Gen-Xers and Millennials to get my fair share of the pie? Oh, my! A recent article published in Home Furnishings Business stated, "The traditional distribution channels of independent furniture stores, department stores and national merchants, which decades ago controlled more than 90% of all furniture sales, have declined to less than 50%." So, does this spell out doom and gloom for the independent retailer? Absolutely not! I prefer to view this as opportunity and a time to embrace change. Lifestyles are changing, how we shop and do research is changing and along with that the brick and mortar retail experience we provide our guests must change as well. Let's look at the multitude of generations we are marketing to. Baby Boomers, who are made up of individuals born between 1946 and 1964 represent 34.85% of households, 37.2% of consumer sales and 34.7% of furniture and bedding sales. As Boomers move closer to retirement, their home furnishing needs change as well. Downsizing means smaller scale furniture. And where do Boomers begin the shopping process? By doing research on the Internet, of course, and a whopping 51.8% do so. But guess who their #1 choice of retailers is to do business with? The independent retailer! Next up, Gen-X, born between 1965 and 1980, account for 27.5% of households, 32.8% of consumer sales and represent the greatest opportunity in terms of growth in furniture and bedding purchases. With an age bracket ranging from 37 to 52, this generation wants and needs run the gamut from upgrading their current home furnishings to additional needs due to remodeling and expanding their current living space. The upper end of this generation is just beginning to see the first of their oldest children preparing to leave the nest, resulting in a change in lifestyle and, you guessed it, a change in their wants and needs for home furnishings. And like the Boomers, 50% begin their shopping process on the Internet. I hope everyone has a dynamic and well-performing website. If not, please make that your #1 priority in 2018 as it is the foundation of your business! Although 24.1% Gen-Xer's prefer regional chains as their retail outlet of choice, coming in at second place is the independent retailer at 22.5%. And finally, the Millennials, not to be feared but embraced! This generation is made up of individuals born in 1981 or after, and accounts for 22.9% of households, 19.4% of consumer sales, and 22.4% of furniture and bedding. This number will grow significantly as this generation matures and becomes a generation larger than that of the Baby Boomers. And like the Boomers and Gen-Xer's, 61.7% of Millennials began their shopping process on the Internet. For me, the Millennials are an exciting and fascinating generation as they represent the future. Although they prefer mass merchants (28.4%) as their #1 choice of retail outlets for furniture, the independent retailer ranks #2 at 22.7% and this percentage is expected to grow. At the end of the day, when it comes to home furnishings, just how different are the wants and needs of today's consumer, regardless of their generation? Our home is our castle and all generations believe its furnishings are a direct reflection of who we are, and that the quality of the product is extremely important. All generations begin the process by doing research on line and doing business with independent retailers ranks very high amongst their choices. The future is bright, so let's not head in to the dark forest of retailing fearing those lions and tigers and bears. The future calls for a new and exciting way to market ourselves and attract our customers of today and tomorrow by changing the retail experience and heading for the Emerald City with the promise of success, prosperity and well-being… oh, yes! FURNITURE RETAILING— WE'RE NOT IN KANSAS ANYMORE! RO Bill Bazemore Furniture Trends Bill Bazemore is the Vice President of Furniture for Nationwide Marketing Group. Call (770) 442-9726 or visit furniture@nationwidegroup.org.

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