Design & Designer Forecast: Michael Cleghorn

INTERVIEW WITH MICHAEL CLEGHORN, MC&Co TREND

Here is a close look at the six shopper aspirations that MC&Co Trend says will define how consumers will make furniture purchase decisions in 2024.

For this Design and Designer series installment, Furniture World interviewed Michael Cleghorn, Founder & CEO of MC&Co Trend, a company that, according to the company website (mccotrend.com), presents “powerful, unbiased trend forecasting reports to change the way you predict, develop and design, without guesswork or bias.”

Cleghorn noted that what differentiates MC&Co Trend is that he and his co-founder, Linda Simpson, CEO of Imagination Network, their US and North American partner, both came to the company from commercial backgrounds. “Linda,” he said, “had diverse experience as a buyer and product development manager with companies such as Bloomingdale’s, Associated Merchandising, Silvestri and Enesco. I was a buyer, merchandiser, and brand manager for large Australian retailers. We met while working on a project with the Department of Trade in the Philippines tasked with repositioning the Philippines as a credible source for homewares and furniture. It was then that we realized there was an opportunity to create a forecasting process that was commercially focused and actionable.

“Some trend reports we saw in the marketplace at the time had such a broad focus that it seemed like everything was trending. We wanted to bring our reporting into focus for manufacturing and retail brands. This idea drove us to develop a scalable process we call our Trend Intelligence System.

“Our forecasts look at about 40,000 images from the world’s most important retail and wholesale brands, interior designers, hotels, and magazines. We use this information to create 26 different positions on style every six months. We also track 26 moods and put them through a series of useful filters.”

Cleghorn said their forecasting process starts with a focus on six ‘aspirations’ that align with the ‘moods’ in the marketplace —grounded, ordered, escape, nostalgic, playful and opulent. “Although they are always present in the home furnishings market,” he observed, “these aspirations evolve due to geopolitical, demographic, social, economic and other conditions.

“The second thing we look at is how home furnishings consumers view their lives through the five attributes of mood, color, pattern, material and texture, and shape. There are four different ways that people approach their lives through these five attributes: optimism, ambition, discipline, and accomplishment. “Thirdly, our analysis addresses the evolution of the styles we follow regarding their commercial timing and positioning. For example, what’s happening with coastal, mid-century or traditional elements.”

Although MC&Co Trend’s analysis looks at trend forecasting from a macro perspective, its primary focus is creating information that can be highly customized for manufacturing brands and retailers. To take advantage of the full range of information available, brands and retail organizations must, as a first step, have awareness of the evolving aspirations of their target customers. That’s something many furniture retailers haven’t fully grappled with.

Pragmatic vs. Decorated Homes

“I think it’s essential, Cleghorn said, “that retailers and brands start looking more closely at their customers’ aspirations. Much of the market is moving away from offering products that are highly focused on serving pragmatic sorts of customers, for example, by showing the best-priced three-piece recliner set in leather and building a room package around it.

“Their forecasting process starts with a focus on six ‘aspirations’ that align with the ‘moods’ in the marketplace—grounded, ordered, escape, nostalgic, playful and opulent.”

“The consumer focus on expressing personality through furnishing homes is a growing trend, driven in part by ‘reveal shows’ that change rooms from cluttered messes to fabulous environments. Studio McGee’s mission to ‘Make Life Beautiful’ and similar shows have built awareness that there is spiritual or emotional significance to home environments that can make people feel better.

“Many retailers have been looking at each other and trying to price competitively rather than taking a broader view of their customer’s lifestyles. Retailers like Williams Sonoma have grown by taking on lifestyle positions. Big box companies like Lowe’s and Target, have developed a real focus on trends that surpasses what many traditional furniture retailers have done.”

Six Aspirations Defined

1. Ground Aspiration: “The ground aspiration is the emotional connection to creating calming, relaxing havens that make customers feel earthy, spiritual and healthy. It has grown in influence over the last ten years, along with yoga, mindfulness, farmer’s markets and slow living. The ground aspiration is internally focused on ‘me, my health and self.’ From a macro perspective, the ground aspiration is stable and has influenced the following five aspirations.”

2. Escape Aspiration: “The escape aspiration is about being extroverted, engaging with people, having good times, entertaining and, sometimes, bringing vacations into home environments. We see the nostalgic aspiration, a sentimental idea, growing and diversifying in the current geopolitical environment.“

3. Nostalgic Aspiration: “Our customers have experienced a pandemic, a cost-of-living crisis, inflation, uncertain geopolitical situations and wars popping up everywhere. They feel nostalgic for what seems like safer times. The nostalgic aspiration is growing and diversifying from a macro perspective.”

4. Opulent Aspiration: “Opulent is an aspiration connected to being seen as wealthy and living a luxurious, sophisticated, worldly existence. It is also increasing in influence. From a fashion perspective, labels have moved from the outside to the inside of garments because overt displays of wealth during tough times can be seen as vulgar. Soccer moms have transitioned from driving a Mercedes Sport to a Mercedes SUV. They still buy luxury but frame their purchases from a different set of needs, such as the safety of their kids. Instead of saying they are going to a glamorous resort, they may describe it as a six-senses yoga retreat.

   “People want to achieve old-money looks as opposed to new-money looks. Louis Vuitton, Chanel and other well-known apparel companies tend to be seen as crass, new-money brands. Instead, consumers are reconsidering Brooks Brothers and classic Ralph Lauren aesthetics.”

5. Ordered Aspiration: “The ordered aspiration is all about seeking comfort in order. This aspiration is currently stable and influential.”

6. Playful Aspiration: “Playful, characterized by whimsy and color, is all about being spirited, cheerful and rebellious. We’re talking Jonathan Adler-type styles, boosted by an exit from COVID with a need for optimism.”

“Pottery Barn focuses on traditional American nostalgia. West Elm focuses on mid-century nostalgia. Crate & Barrel has an ordered and grounded aspiration, and Jonathan Adler has a highly playful aspiration.”

Gobblers and Nibblers

“I don’t mean this in a derogatory way,” Cleghorn noted, “but retail market share is being siphoned off from many old-style furniture companies. The market is changing. Look at what fast retail fashion brand Zara (https://www.zara.com) did in clothing and home furnishings, then consider why department stores have lost so much market share over the past 20 years.”

Cleghorn elaborated on why furniture retailers should be alert for what he calls gobblers and nibblers. “Many emerging digital home furnishings brands that focus on a single aspiration,” he observed, “have gobbled up market share from more traditional brick-and-mortar furniture store brands that appeal to a wide audience.”

He is uncertain whether many of Furniture World’s readers have focused enough on identifying these single aspiration competitors or created effective strategies to compete against them. “For example,” he said, “Pottery Barn focuses on traditional American nostalgia. West Elm focuses on mid-century nostalgia. Crate & Barrel has an ordered and grounded aspiration, and Jonathan Adler has a highly playful aspiration. For high-end stores, maybe RH is gobbling up market share, and for a promotional store, perhaps it’s Target.

“Besides gobblers, furniture retailers must be aware of smaller online nibblers selling particular looks that focus on a specific aspiration through Wayfair and Amazon. Only then can they develop ways to take back little bits of market share from these guys.”

Managing Style Evolution

Furniture World asked Cleghorn how furniture retailers might evolve from selling a sea of products to being more trend-focused.

“My advice is to give customers what they want at the moment, then inspire them with what they could have,” he replied. “They should do more research. For example, match our six aspirations with their customer’s transactional histories. And incentivize customers to fill out customer surveys that place them in the most stable aspirational groups, such as grounded or ordered.

“Large retailers can afford to have marketing departments that talk about their customers’ feelings, avatars, profiles or personas in a sophisticated way backed by research, but any retailer can put a variety of looks and styles in their social media feeds and measure engagement. They can also look at their top sellers, see where they align with the six aspirations, and review helpful, free materials found online, including previous forecasts on the mccotrend.com website.

“The goal of performing this kind of research can be to present products and collections better aligned within the evolving part of their market, moving selections slowly towards positions that reflect how their customers’ aesthetics are evolving.

“Doing this requires an alignment of proportion, material and texture for case goods and upholstered designs. We suggest creating more stories that resonate with customer aspirations. Develop small in-store presentations that reflect where these aspirations are going and maybe do softer marketing around concepts to see how customers respond. That’s how to pull new customers away from gobblers and nibblers. We talk to our clients about this based on the deeper work we do, but there’s no reason why other retailers can’t start thinking about these issues on their own.”

Cleghorn observed that brands and retailers tend to blame poor sales performance on the products they produce or purchase from suppliers. “They approach us saying, ‘We’ve got a product problem.’ Our analysis shows that they often have problems knowing who their customers are, how their internal teams communicate, or their processes.

“Retail departments can be quite siloed. Buyers and product developers may buy a product with a certain concept in mind. But then, their visual marketing and advertising departments develop different concepts completely out of sync with the original intention.

“All departments should be on the same page regarding their target customers’ aspirations, approach to life, cycle, viability and velocity. Once this language enters a business,” he emphasized, “buyers or product developers can explain if a concept they create is emerging or evolving for their audience. Then, marketing departments can adjust messaging to, for example, attract the interest of early adopters or adjust to a mainstream mood.

“An awareness of customer aspirations,” he continued, “can become part of a company’s brand DNA. When that happens, a new language forms that seamlessly links product development to marketing and retail operations. Once everyone in an organization understands this language, it leads to better planning, execution and emotional connections with customers.

“This approach is also a great way to bring analysts and senior managers who may not have a strong understanding of where aesthetics and style are going, into the conversation so they can manage the people below them.”

Baby Steps

Engaging with this process doesn’t often happen in one season. “That’s why many of our clients,” said Cleghorn, “are on a two- or three-year program of evolution starting with what we call a ‘handhold to handover.’ Check-ins are needed to measure the implementation progress. It’s necessary to ask if the rug buyer is aligned with the lighting buyer, the upholstery buyer and the case goods buyer. Is everyone from the CEO to the newly hired sales associate aligning their stories?”

Market Movement

He explained that marketing to shoppers with a focus on the grounded, ordered, escape, nostalgic, playful and opulent aspirations is a proven way to attract customers interested in expressing themselves through home interiors. Purely transactional shoppers who primarily want a comfortable and affordable sofa may not be as interested in digging deeper.

“In general, the market for home furnishings is moving towards shoppers who are thinking, ‘What do these products say about me? What will people think of me? Do I feel the emotional connection?’ Marketing with this in mind has become a more important consideration.”

Losing Entrepreneurial Assessment

Cleghorn believes that some retailers who buy by the numbers can lose the art of what he calls entrepreneurial assessment. “If we think about the market in a very simplistic way,” he explained, “there are three types of shoppers: the decorator, the innovator and the pragmatist. The market is moving from the pragmatist type to the decorator type. So, retailers operating by the numbers in functionally oriented furniture operations should, depending on their specific model, consider moving from a pragmatist toward a decorator orientation.

“In a design business, not everything can be run by spreadsheets. There has to be a dynamic tension between analytics and entrepreneurial assessment, vision and risk-taking,” he observed. “There’s a lot less risk in retail than we used to have. Innovating and taking on risks needs to be qualified. This is what we try to do through our trend forecasts. We qualify where the least risk is for a business looking at innovation through product programs. Every company must find a path forward by evolving a measurable strategy that works within the current supply chain and marketing dynamics. Refreshing an evolving style is usually less risky than working with emerging trends. However, retailers can take elements from emerging trends and apply them to evolving trends to stay relevant.”

Demographic Effects

Retailers can no longer assume that older shoppers will necessarily aspire to create traditional home environments and that younger demographic groups will do the opposite. Cleghorn provided an example. “Interior designer, actress and fashion designer Iris Apfel,” he pointed out, “has created a new culture of older women who are saying that they refuse to age gracefully. Instead, they want to be incredibly playful through color, whimsy and humor. That’s a ‘playful aspiration’ mindset normally associated with a younger generation.”

He believes that shopper’s aspirations and approaches to life have little to do with age, earnings or socioeconomic position. “People who want opulence in their lives,” he told Furniture World, “can be wealthy, retired baby boomers who hire top designers to create million-dollar fit-outs for their apartments. But a 26-year-old Gen Xer who lives in a basic studio apartment might fulfill their opulent aspiration by purchasing a velvet cushion from K-Mart or Target.”

Conclusion

In closing, here are other style considerations retailers might think about courtesy of Michael Cleghorn:

• Polarization: What’s interesting about our six aspirations from a marketing perspective is that home furnishings shoppers’ social media feeds have become polarized. If a shopper keeps searching online for nostalgic home furnishings styles, eventually, that’s all they will be exposed to. Much like politics, style is becoming more polarized.

• Style Guides: If you don’t already have one, create a style guide.

• Alignment: Create alignment between buyer categories.

• Be Alert: Watch retailers that present highly considered, curated and resolved interior expressions, such as RH, West Elm and Room & Board. They’re growing.

• Self-curation: If your store targets customers with multiple aspirations and lifestyle choices, consider focusing on eclectic self-curation. Consumers who want to tell you ‘their style’ is a strongly growing innovator category.

• Individualism: Consider that younger consumers mix their clothing eclectically to create their own styles. Many, especially those with less disposable income, are focused on mixing, re-purposing and recycling flea market and secondhand shop finds with contemporary to build highly eclectic, self-curated interior home furnishings looks. This trend is likely to influence more mature demographics as well.

• Small nibblers: Highly curated looks that reflect a specific mood may be difficult for some established furniture retailers to commercialize. Consider how small online nibbler companies that have done this successfully are siphoning off market share.