A new CSIL report highlights major structural changes in Europe’s furniture sector. Although some of the trends have been underway now for at least a decade, recent events have brought about accelerating change. According to the report, major trends include:
An unprecedented increase in online sales that now account for over 10% of the total European furniture market. The pandemic outbreak accelerated a massive change in consumer behaviour shifting from offline stores to e-commerce. Moreover, the e-commerce channel has bolstered international penetration enabling leading furniture retailers to expand into new markets at lower costs (including countries where they may have a limited network of stores).
A slightly decreasing share of the overall market occupied 'specialist' retailers. This trend is mainly due to the increasing role of the online channel that has eroded market share of organized chains specialized in home furniture and of independent stores. The latter particularly suffered in 2020 during the months of lockdown.
Relative stability of market share of ‘non-specialized’ retailers. During and after the pandemic outbreak, home improvement projects increased particularly benefitting DIY chains. DIY chains were also able to remain open during the months of the lockdowns while other competitors were forced to close.
Changing behaviour of consumers impacting on distribution of big supermarkets and hypermarkets.
Shopping districts in large towns and city centres have become a far more attractive place to purchase. Leading international furniture retail chains, such as IKEA and Maisons du Monde are developing new store concepts.
For more than half a decade, IKEA has been a singleformat retailer. However it is now investigating new ways of meeting customer needs. For example by establishing stores in inner-city locations and by balancing the big-box superstore format with smaller format stores that use digital technology to provide access to the full product range.