Now that COVID vaccinations are happening and the economy is slowly heading to recovery, let’s take a step back and look at the challenges 2020 brought. Here’s a list of some of the most significant market trends and statistics that shaped 2020 and how you can utilize them to build momentum in 2021.
- The Housing Market
In its annual report, the National Association of Realtors shares optimistic numbers. With historically low interest rates, they envision that the housing market will continue to see a steady growth well into 2021.
- Sales of vacation homes increased 16.3%, outpacing the 5.6% growth in total home sales and the first-time buyer sales. That’s 310,000 new homes that need new furniture.
- First-time buyer sales rose 9%, creating a market of 1.86 million Americans looking to furnish their new homes.
- Single-family home sales rose 6.3% while condominium sales decreased by 0.3%. People moving into bigger houses can fit bigger sofas, dining tables, and mattresses.
- Home Office
Even before the pandemic, remote work was on the rise. According to Global Workplace Analytics, 4.7 million employees were already working from home in 2019, accruing a 400% growth since 2010. And with people moving into new and bigger houses, demand for appliances, furniture, and home-office furniture may see an increase over the next year. Reach out to this customer segment with flyers and local radio, or entice potential buyers with “homewarming” discounts on their first purchase.
- Millennials
With an estimated population of 72.1 million in 2019, millennials are the largest working generation in the U.S., according to Statista. Along with Generation Z, millennials will make up the main economic force in the country for many years. Born between 1981 and 1996, millennials are avid video game players, social media users, wellness enthusiasts, and online shoppers with a very clear set of expectations. Developing the systems needed to fulfill their requests will help you win them over. According to a Global Web Index survey the top five drivers for millennials to shop online are:
- Free delivery 48%
- Coupons and discounts 39%
- Reviews from other customers 34%
- Easy return policies 31%
- Quick/easy online checkout process 29%
- Digital Convenience
Consumer dependence on the internet and online shopping is here to stay. According to Statista, in 2019 e-commerce sales accounted for 14.1 % of all retail sales worldwide and it’s projected to reach 18.1% in 2021. If you want to capture more customers, you must be ready to reach them wherever they shop and developing an omnichannel strategy is the way to go for retail. Use technology to provide a more personalized service, improve customer satisfaction, and boost retention. An e-commerce site will pay off and produce long-term benefits for your business, learn How to Build an E-Commerce Channel in 8 Steps.
- Stay Fit at Home
COVID forced the transition from gyms to home fitness. Consumer interest in healthier lifestyles catapulted treadmills, stationary bikes, and free weights sales to double from March to October 2020, according to NPD retail data. With their recent purchases, consumers will now focus on complimentary devices to improve their performance. Wellness and healthy lifestyles will not fade, and younger generations will become a greater force in sports retail.
- The Great Outdoors
When travel halted at the beginning of 2020, Americans turned to outdoor activities like hiking, camping, and golfing. According to an article in The Washington Post, “golf had its’ best summer in decades”. According to Livingetc, the desire to spend more time in backyards, patios, and balconies, boosted demand for outdoor kitchens, seating, heating solutions, with rattan furniture seeing a whopping 800% increase in sales. Consumer’s interest in sustainability and natural products will keep the trend moving forward, and 2021 furniture collections should reflect it.
- It’s All About Comfort
Last year’s lock-down brought a 32% increase in sales of cooking and baking appliances, NPD reported. Americans newly-developed hobbies boosted sales in items such as electric grills, toaster ovens, electric pasta makers, and fondue sets. This year, among comfier sofas, sustainable furniture, and home-office solutions, Livingetc says storage solutions for all those kitchen additions may see a higher demand. Lock-down also created another interesting trend—self-care and pet adoption. Massage tools sales rose 86% according to NPD. According to an TD Ameritrade survey 33% of Americans considered fostering or adopting a furry friend, with millennials leading the trend at 50%.
Experts agree that adaptation and caution will remain key for retail businesses in 2021. Millennials will continue pushing e-commerce growth, in-store shopping will slowly bounce back as restrictions ease up, and remote work will prevail. To adjust to these market conditions, retailers can focus on three basic strategies:
- Reach customers wherever they shop
- Listen to their needs
- Use technology to provide excellent service