13 minute read
INSIGHT
FAIR PLAY?
Wayfair was clearly a force to be reckoned with before the pandemic – but with repeated lockdowns helping catapult its customer base past the 30 million mark, the Boston-born etailer has truly cemented its hold on the global homewares market. In this exclusive interview, Furniture News asks Wayfair’s head of Europe, Martin Reiter, what’s to come – and if the UK’s furniture retailers should be worried …
How has Covid-19 catalysed Wayfair’s ascendancy, and what role does the UK business play in the global picture? It’s definitely been a stratospheric year. Covid-19 created a unique set of circumstances and home became the epicentre of everyone’s lives, highlighting the attractiveness of Wayfair’s value proposition to our customers. Many people turned to online shopping for the home for the first time, both in the UK and across our other global locations.
During this period, the number of active customers has grown globally by +53.7% to more than 31 million – new, and loyal. In Europe, we have hit a net revenue run rate of more than $1b, and the UK has played a key part of that growth.
Covid undoubtedly catalysed Wayfair’s ascendancy to some degree, but we were uniquely positioned to meet unprecedented demand due to our scale and the strategic investments and long-term orientation that we’ve made over the years – particularly in our large, flexible supply chain network, and scalable, agile tech infrastructure.
How has Wayfair changed in response to the pandemic? The complex Covid-19 period definitely enhanced our already close alliance with our more-than 12,000 suppliers – 3000 of which are based in Europe. We have doubled down on communication, sharing real-time guidance that enabled many of our suppliers to remain open and operational. We continued to diversify, expanding our core catalogue of furniture and decor as well as housewares, renovation, plumbing and more, so customers can continue to meet all their home needs in one simple-to-use online destination.
With our customers spending so much time at home navigating lockdown life, we have also tried to tailor our marketing strategy to answer their changing needs and to sensitively recognise the challenges that everyone has been facing. We’ve run a number of Covid-19 response campaigns across our channels, including our Happy at Home campaign, which aimed to offer support, guiding customers on the best ways to reconfigure and organise their spaces for productivity, comfort and wellbeing – from practical guidance on how to set up a quick and easy home office in the garden, to inspiration on how to integrate mood-boosting colour.
We’ve continued to offer exceptional value, particularly through major sales like Way Day, which just returned this April. We’ve also run a number of charitable efforts including our Save Big, Give Back campaign, where we donated a proportion of profits to Unicef to help with critical Covid-19 relief. These approaches have been hugely well received, and a lot of the pivots that we made will be here to stay in 2021.
WE’RE DECISIVELY TACKLING A $49B UK MARKET OPPORTUNITY FOR HOME AND LIVING ECOMMERCE
Is there any reason UK retailers shouldn’t see Wayfair as their greatest threat? Since Wayfair’s conception, we’ve been focused on building a world-class online homeware destination that will transform the way consumers shop for their homes, and this has really been pivotal to our success, and is what sets us apart, I think.
We work with our family of suppliers to ensure that we have the very widest selection of homeware available onsite, with more than 22 million items available worldwide – a million of which are available to UK shoppers. We’re also constantly striving to deliver excellent value.
Wayfair’s Summer House makeover reflects consumer appetite for outdoor comfort
Beyond this, we have been superfocused on delivering an exceptional retail experience, through technology, inspiring merchandising and a fast, frictionless delivery experience via our proprietary logistics infrastructure. This recipe continues to garner results for both us and our suppliers. In addition, we have always been, and we remain, heavily focused on the long term, investing decisively and strategically in our future.
Are we the biggest threat to UK retail? I would like to think we are actually a platform that can help many home retailers, big and small.
Has the balance of online and in-store shopping shifted for good? And how much further can it go? While the pandemic has definitely boosted demand for homeware, especially within the online sector, customers acquired during Covid still appear to look similar to other recent cohorts in terms of repeat trends.
Looking beyond the acute pandemic period, we fully expect that Wayfair will benefit from having a relationship with each of these customers, and that we will be able to engage with them in highly personalised ways, as we’ve always done.
Ultimately, we’re decisively tackling a huge market opportunity for ecommerce in home and living – of $49b in the UK. We remain focused on delivering an exceptional shopping experience, growing our customer base, and are super-excited about the opportunity ahead.
What qualities do you look for in a supplier, and how might they best work with you? Whether you’re a large-scale manufacturer or a small business, our aim is to help suppliers with or without storefronts across all EU markets access fuss-free dropshipping, red carpet merchandising, brand curation and powerful promotions and marketing – without any capital investment in sales teams, operations or physical presence in the UK and Germany.
Our business model is based on driving ultimate selection, so we are extremely receptive to onboarding suppliers, big and small. My advice would be, if you’re looking to expand your market presence in the UK and Germany, becoming a Wayfair supplier will help drive your online sales while taking all the ecommerce work off your shoulders.
We recommend that our suppliers follow our recipe for success, and those that do invariably see strong results.
Aside from garden chairs and patio heaters, what’s selling particularly (or surprisingly) well right now? We’ve seen an enormous surge in interest in garden lines, peaking earlier than ever, presumably in response to the imminent lifting of lockdown restrictions and the prospect of al fresco entertaining being back on the table again.
In fact, the vast majority of our fastest-growing classes have been outdoor focused. This spans everything from dining furniture and parasols to deck boxes, ice boxes, tabletop pieces, outdoor rugs and cushions. We’ve also seen a big trend for tiki-style garden bars and potting benches. Lockdown might be easing, but it seems like customers are still keen to create a safe and fun space to entertain at home.
Have you made many advances in onboarding home and living brands in the past year? We have added more than a thousand additional home and living suppliers, representing a mix across all categories,
A sample of living room products within Wayfair’s Hykkon brand
styles and price points to match our broad customer base.
Key brands from the UK have included SMEG, Russel Hobbs, Chilewich, Mama Designs, Soda Stream, Ideal Standard and Abode, broadening selection in our furniture, kitchen and housewares, as well as plumbing and renovation categories. Our European supplier base now stands at more than 4000, and is constantly growing.
How much power do you have to influence trends – as opposed to simply following them? With more than a million home items available in the UK across every style and price point, and with technology at the core of our business DNA, we are uniquely positioned to be able to access a wealth of search and sales data that very much informs our trend forecasting.
We see an unprecedented volume of homeware, so are able to get a very strong read on trends before they come to market. That being said, we strongly believe that Wayfair gives everyone the power to create spaces that are just right for them. We’re a destination for all types of customer, across all styles and budgets, so to some degree, while we have a strong read on the trends, we never discriminate. Everyone and every style is welcome.
Hykkon, Wayfair’s own home and living brand, offers stylish home office solutions
How do Wayfair’s UK marketing activities break down, across various media and channels? We’ve built robust marketing programmes across every stage of the customer purchase funnel, and continue to invest decisively to drive awareness and maximise impact. In the UK, we are investing strategically across a wide marketing mix, both above and below the line.
Our main focus in 2021 will be on continuing the momentum we have established and providing a great customer experience.
What’s the most crucial part of the ecommerce puzzle – platform, product, promotion … or something else? That’s a great question, but it’s impossible to single out one part of the puzzle. Everything works in mutual symbiosis. For me, delivering exceptional customer service is also really key.
Can you reveal the scale of your ambitions across the furniture and furnishings sector, and suggest how and when they might be achieved? We remain laser-focused on the huge home category TAM [total available/ addressable market], where furniture and furnishings play a key part. Our ambition is to reinforce our winning platform for both customers and suppliers, and effectively balance growth, profitability, and high ROI investments for many years to come.
We saw the benefits of this approach in 2020, and are excited to see what 2021 has in store. There’s everything to play for
READY TO ASSEMBLE
Polish RTA powerhouse Forte is taking its UK operation to a new level, offering retailers a plethora of tailored designs, backed up with a plethora of guarantees and marketing support. Furniture News asked national sales manager Victoria Ross to outline the new direction …
www.forte.com.pl
What is Forte, and what does it offer? Founded nearly 30 years ago and supplying over 4500 customers worldwide, Forte is one of the largest European manufacturers of furniture for self-assembly. We have five stateof-the-art manufacturing plants, totalling 160,000m2, and we develop 800 new models every year.
We offer self-assembly furniture for all areas of the home. We offer a comprehensive living and dining range, but are best known for our upstairs collections of bedroom and home office furniture.
How long has the brand been present in the UK? Forte has been present in the UK market for 15 years, but only in a very limited way.
Why did the business choose to relaunch its UK offer now – and how has it evolved? The decision to relaunch Forte was taken in 2019 following an in-depth
Victoria Ross
THAT WOULD FIT WELL IN THE UK
Malamati
analysis of the current marketplace. We could see the trend towards welldesigned self-assembly furniture, and knew that we had already-successful products that would fit well in the UK.
Our original plan was set for a soft launch in summer 2020, but this was delayed due to the current pandemic situation. We have used this time to further develop our UK-tailored offer and to build processes, enabling us to supply customers with delivery terms that suit them, following the changes since Brexit.
We have taken a selection of the larger Forte offer and made all of the necessary adjustments to have these products immediately available to UK customers – bed sizes and styles have been changed to suit UK trends, and sideboards and TV units changed to better fit the size requirements of UK consumers. Where applicable, light fittings have been changed, and now come with either a UK or USB power supply.
Will UK buyers still have access to the complete offer? Absolutely! The UK catalogue is just a snapshot of what Forte can offer. Customers can access our entire catalogue of almost 3000 SKUs, and order most items without having to meet high production minimums. We can also tailor any lines or programmes for a more specific need where justified.
How does the product stack up in terms of value, quality and materials? Forte product offers the highest quality in terms of value for money. With our in-house design team working closely with our quality department, all items are developed and tested for the rigours of everyday use. We are constantly updating our range of finishes and our build technology, to offer the consumer the best possible experience.
What are the likely lead times? And, being post-Brexit, can buyers expect any headaches ordering from Europe? The current lead time is six weeks, although we are often able to offer
quicker turnaround. Since Brexit, we have invested heavily into our UK business to ensure we can offer customers the most practical ways to purchase and receive our products – including a fully declared option, minimising paperwork and costs for our customers.
Do Forte’s products come with any additional guarantees? Everything is offered with a 12-month guarantee against manufacturing faults or problems. All of our facilities are audited by ISO and SMETA.
We also support responsible and sustainable forest management – as a manufacturer, we source our woodbased materials exclusively from legal sources, certified and controlled in accordance with FSC standards.
In terms of supply continuity, our wholly-owned chipboard manufacturing plant means we’re not subject to the supply issues that have affected some of our competitors in recent months.
Do you offer any services to streamline the buying process or support stockists? We work closely with our customers to support them with whatever materials they need to maximise sales. We supply high-quality imagery and, in some cases, product videos, along with additional PoS material if required.
How are you planning to take your offer to the market from here? We were so disappointed that the January Furniture Show was postponed and then cancelled, as we had planned for it to be our launch event – but we will be there in 2022, and look forward to being able to showcase our latest products and designs.
In the meantime, we are launching our new catalogue this month, and we have been working hard on perfecting
Kashmir
Marida
the ‘virtual show’, to give both existing and new customers the next-best experience when looking at our stand.
Can you give us an idea of Forte’s ambitions? Because we are starting with only a handful of existing customers, our growth plans are ambitious. Already in 2021, we are seeing significant YoY growth, and we have no limit to the infrastructure investments we are willing to make to ensure we have the best offer for our customers – both in terms of product, and the customer service they can expect to receive from us.
High Rock
What brought you to the business? Who else is involved in the UK operation? I joined Forte in 2019 following a really long recruitment process. I joined at a time of change within Forte, and I have seen our back-office systems and processes adapting and changing to meet the demands of the current market.
I am fully supported by a team of experts in terms of product development, sales, quality and logistics, both in Poland and here in the UK. We plan to add to our team in the coming months, as our business continues to grow in this market.
What would you say to a retailer who has never bought from Forte before, but is keen to broaden their bedroom furniture offer (in-store or online)? Come and have a look – we have such a wide variety of products in our good, better and best offer, covering most of the market’s requirements in terms of pricing and quality
WE ARE WE ARE FORTE FORTE
