Market analysis Home & Living: The German online furniture market

Last year, Germans spent a total of 22 billion euros on sofas, tables, chairs and the like. Compared to other European countries, Germany is the highest turnover market for furniture manufacturers, closely followed by Italy at 20.9 billion euros. Other European countries (Poland, France, Turkey, Spain, the Netherlands), on the other hand, do not even record half of German sales in this sector.

In our latest market analysis, we take a closer look at the “Home & Living” sector. We show you how this market will develop over the coming years, what is important to consumers when buying furniture and how you can best use this knowledge for your online shop.

Growth potential in the German online furniture market

In contrast to other product groups, furniture and household goods are mainly purchased offline. This is hardly surprising, as the costly distribution and returns processes, plus the lack of visualisation and testing of products in online retail, tend to drive consumers towards the furniture stores. Although some retailers already use 3D product visualisations or augmented reality apps, eCommerce cannot completely replace the stationary shopping experience.

According to a forecast by the auditing firm PricewaterhouseCoopers (PwC), online sales of furniture and household goods will increase by an average of 14 percent per annum between 2016 and 2020, while total sales will grow by only 1.2 percent. The German online housing market thus offers considerable growth potential. 

The furniture market cries out for omnichannel concepts

Even if more and more furniture and household articles are currently being purchased offline, retailers and manufacturers should not lose touch in these times of digitisation. Especially with large and expensive purchases – such as furniture – consumers often prepare online for purchase in the shop and find out in advance about interesting products, which are then tested out in the shop itself. Conversely, as in other sectors, it is often the case that consumers decide to buy the product online after consulting with stationary retail. And this is exactly what you, the retailer or manufacturer in the furniture segment, should be prepared for.

The furniture market is dominated by generalists and is currently still divided into stationary retailers, multi-channel providers and online pure players. The online pure players, which provide a strong competitive advantage in eCommerce due to their lean cost structures in the online sector, include, for example, home24and Westwing. Only a few retailers are already developing into omnichannel providers. The industry leader IKEA is regarded as the clear pioneer of the omnichannel in stationary sales, as well as online sales, in the “Home & Living” segment.

 “With omnichannel concepts that combine stationary showrooms with online distribution channels and technological innovations, as well as uncomplicated and consumer-friendly exchange processes for online purchases, retailers can overcome the existing resistance. And this will be worthwhile, because online sales offer large growth potential for the German furniture market“, says Patrick Ziechmann, an expert in the retail and consumer goods sector at PwC in Germany.

It is therefore advisable for retailers and manufacturers to consider an omnichannel concept in order to assert themselves in this fiercely contested arena and thus secure long-term success.

Furniture and household goods in eCommerce

OTTO.dehas also examined the furniture industry in more detail and makes clear in its “OTTO Living Study 2018”,which was published at the beginning of 2018, that the sale of furniture and household goods via online channels is becoming increasingly important. According to our own studies, online purchases in this segment have risen by 15 percent over the last three years (from 22 % to 37 %).

Market analysis Home & Living: The German online furniture market

The purchase of furniture on the Internet has increased by 15% compared to the 2014 survey. (Source: “OTTO Living Study 2018”)

According to the study, this increase can be attributed more to women than to men, as females are generally more willing to buy online. A total of 40 percent of women buy furniture and household goods on the Internet, whereas only 33 percent of men do so. At the same time, this increase in online furniture purchases is mainly driven by younger couples and families.

Criteria for buying furniture online

Compared to the study of 2014, furniture buyers are now somewhat more demanding. This is clearly reflected in an increased price sensitivity of 25 percent. Furthermore, the durability of a product, an attractive appearance and functionality are the three most important criteria for buying furniture on the Internet. Consumers, on the other hand, attach less importance to sustainable production or a fast delivery.

Women have higher demands than men, especially when it comes to visual aspects, but also when it comes to cleaning the products.

How to position yourself successfully in eCommerce

With the leap in eCommerce sales expected over coming years, the big furniture advance is beginning in the furnishings industry. With the growing variety of suppliers, brands and makers, consumers are comparing prices and features more than ever before. Retailers and manufacturers in the Home & Living sector can only remain competitive if a well thought-out pricing and product range is put in place.

To this end, blackbee supports manufacturers and retailers in the Home & Living sector and gives them the market transparency they want. Thanks to its unique, and learning, matching technology, our highly automated software blackbeecan daily collect, analyse and structure market data on the Internet. This gives you an overview of your own market and will also keep you one step ahead of the competition.

Let our innovative technology convince you and test out blackbee today!