Consumers continue to focus on the home

Discount Store News, Oct 25, 1999

These diverse efforts to placate a wide array of consumers have kept the mass market share of the growing housewares business the No. 1 channel, at 30.9 percent of all retail channels.

"Flat is very good, particularly when you see the explosion of on-line sellers and their encroachment on other trade classes," says Jon Hauptman, senior associate at Willard Bishop Consulting Ltd., the agency that authored the 1999 NHMA State-of-the-Industry Report.

Although on-line sales of housewares product is growing, government data on its growth is not yet available, Hauptman says.

"The Internet is exploding--not only among pure on-line entities but in sales through traditional retailers" he says. "Their on-line sales aren't being captured because they're just made part of the total sales ledger, such as JCPenney's on-line bridal registry.

"I think housewares is an ideal industry to sell online," Hauptman adds. "Consumers can collect information on items; compare prices easily; identify trends, styles and colors; and do it all without shopping so many stores. Housewares also doesn't have size, fit and texture issues as does apparel, so consumers can make educated decisions."

Already Lechters, JCPenney, Wal-Mart, Kmart, Target, Sears, Ames, Staples, Office Depot and Office Max are selling housewares on line. In addition to this, some manufacturers are selling direct to consumers, although many manufacturers, such as Closet Maid, are opting to direct on-line customers to the retailers via their Web site. The closetmaid.com site educates consumers about how to build their ideal closet using their products and then directs them to retailers. Calling it "a unique combination of commerce and information, this manufacturer isn't just selling. It is solving problems for consumers," Reynolds notes.

NHMA has already run an e-commerce conference this spring with the Consumer Electronics Manufacturers Association and is gearing up for another in May 2000. "Internet retailing is on a course to triple over each of the next five years-- and at that it will still be less than 5 percent of all retail. The question of where housewares will go in cyberspace is still very much up in the air, but there's plenty of opportunity," Reynolds says, adding that there is still room for a virtual retailer to break into the market.

Whether people buy their housewares in physical stores or via retailers' Web sites, Reynolds sees continued opportunities to sell consumers premium items. "People want household items they can use both socially and every day. They want single solutions, not a great set of tableware or glassware for entertaining and a low-priced set for their daily use. They don't want to store two sets. They want to condense their purchases and inventory."

He adds that the integration of home and office "has implications for every room of the house. People want their homes more space-efficient, and they want office furniture that blends well into their personal environment."

Reynolds also urges suppliers and retailers to focus more on teens and pre-teens, who spent $23 billion of their own money last year, mostly on food, beverages, entertainment and clothes. "But they're also looking to spruce up their rooms. It appears to be a great opportunity," he says.