Last year, the coronavirus pandemic upended both consumers and the retail world. And many online home goods retailers benefitted from consumers sheltering in place.
As consumers quarantined, many began altering their living spaces, making their homes more enjoyable and functional for the activities they hosted, which also often included work and school. This was a boon for home goods retailers—and specifically for online home goods retailers—as many stores were shut, and shoppers looked to avoid close interaction with others.
As a result, online U.S. home goods sales grew 51.8% year over year in 2020. However, offline home goods sales declined 8.8%, tempering total home goods sales growth to 6.1% in 2020.
The 104 home goods retailers in the Digital Commerce 360’s Top 1000 posted a slightly lower 49.0% year-over-year web sales growth than that of all U.S. online home goods sales. This suggests that consumers purchased home goods with retailers outside of the Top 1000, or department stores or mass merchants that sell home goods, even if it is not their primary category.
Top 1000 online home goods retailers leverage store closures
Lovesac Furniture, No. 401 in the Top 1000, temporarily closed its retail showrooms during the height of the COVID-19 pandemic in March and April 2020, shifting to an online-only selling model, CEO Shawn Nelson said in an earning’s call transcribed by Seeking Alpha. However, shifting focus to online and adding omnichannel services helped drive sales higher than expected, Nelson said.
“Working our way through the pandemic and all the challenges and tailwind for our industry drove us to be thoughtful about our strategy, intentional and swift, implementing tactical adjustments, and austere in our management of expenses as we braced for the unknown,” he said. “The combination of all these factors led to a year that was perhaps more profitable than we would have intended in our long-term plans beforehand.”
But home goods retailers are keeping a keen eye on mass merchants, which also benefitted from the pandemic-driven surge in ecommerce, because they are encroaching in this category. Online home goods sales for all mass merchants represented 39.4% of the entire U.S. online home goods market, up from 38.4% in 2019. These retailers also collectively grew online home goods sales 55.8% in 2020.
Of all mass merchants that sell home goods, Amazon (No. 1) stands out from the rest. Online home goods sales for the web-only retailer represented a 25.7% share of the total online U.S. home goods market.
Amazon in October 2017 launched its first lifestyle home brands, modern and industrial furniture and decor brand Rivet and modern farmhouse and coastal furniture brand Stone & Beam, and it continues to add to its collections, says Eva Lorenz, general manager, Amazon Home. Customers shopping Rivet and Stone & Beam receive free shipping with Prime, and orders are delivered in as quickly as two days, she says.
Amazon’s investments in home goods are paying off: Amazon sold the most home goods online in 2020 of all the mass merchants and devoted home goods retailers in the Top 1000.
The just-released 2021 Home Goods Report includes a look at emerging trends in the online home goods market, leading facts and figures, benchmarks and more.
The 2021 Home Goods Report includes:
- An overview of the online home goods industry, including total sales and growth
- Data and analysis on the fastest growers and leaders in online home goods
- A breakout section including exclusive consumer survey data about shoppers’ online home goods buying habits and preferences
- Trends in the home goods industry including mobile tools and fulfillment strategies
- A full ranking of the 104 home goods retailers in the Top 1000
- More than 40 charts and graphs
The 2021 Online Home Goods Report is available as a downloadable PDF for $399. It is also included in our Gold and Platinum memberships, which provide full access to all of Digital Commerce 360’s published reports and certain online retailer databases.