New product trends and innovations, shifting consumer preferences, and for millennials and upcoming generations shifting priorities are yielding significant opportunities for growth in home furnishings.

L.E.K. has deep experience in the home furnishings industry, partnering with manufacturers, distributors, retailers and installers in order to help our clients achieve their strategic goals. Our experience in the space covers multiple categories, including furniture, home décor, juvenile, outdoor, office furniture, and close collaboration with our home improvement capabilities. We are a market leader in growth strategy, and our core capabilities in this sector include working with clients on commercial due diligence and on M&A, pricing, channel, brand and corporate strategy. We recommend actionable strategies that drive impactful results for our clients, allowing them to be more efficient and more profitable.

Key questions and challenges

Our experienced professionals have a deep understanding of key business challenges in today’s home furnishings marketplace, and we encourage our clients to consider these key questions:

  • How are customer needs and product trends evolving? What are the implications for how we grow our business? How will the continued growth of millennial spending power influence purchasing behaviors and product desires?
  • How will changes in customer demographics and generational change affect our brand or company? Who are our key target customers, and how are their spending habits evolving?
    How do we optimize our pricing and promotional strategies to maximize value and create win-win solutions for brands and retailers?
  • As the traditional purchase path changes, how do we optimize our channel portfolio? How do we make our channel partners work harder? How can we develop an omnichannel or digital strategy?
  • How do we evolve our business model to be smarter, leaner and more profitable, without compromising growth?
  • Where do interesting M&A opportunities exist, and what real assets can you acquire?
    Are there adjacent products and categories that represent growth opportunities for our brand or company?
  • Should we grow outside of our core markets (domestically or internationally), and if so, how?

Examples of our work

To learn more about how we help clients create value in the home furnishings sector, please refer to these insights and case examples:

  • L.E.K. worked with a national home furnishings retailer on multiple aspects of its customer engagement strategy, including brand positioning and loyalty, promotion, mobile, and digital organization strategy. The work involved a detailed understanding of home furnishings consumers, including how they shop, what they look for, and how to win incremental trips and ultimately profitable sales. The company went through a successful turnaround and was acquired, delivering superior shareholder returns.
  • For a major financial sponsor, L.E.K. evaluated the furniture retail market to reveal the trends and competitive landscape and the growth prospects for a leading national retailer in the space. In particular, we focused on how to influence and build loyalty among the designer community to build share of mind and wallet, intercepting consumers early in the purchase cycle. The work also analyzed and benchmarked the evolving role of the store relative to digital and catalog. Our client completed the transaction, and we held workshops with management to transition learning.
  • For a leading U.S. manufacturer of office furniture, L.E.K. developed a channel strategy to better penetrate segments of the unaligned dealer specialty channel. We assessed the segmentation of end markets and customers, the channel, and customer share trends and needs. We identified specific opportunities in underserved segments and designed a strategy to target these opportunities. The client achieved double-digit sales growth in these channels within the first 12 months of implementation.
  • L.E.K. was asked to provide a channel optimization and sales force effectiveness strategy to a midrange furniture manufacturer. Our work included identifying end consumer segments not well-served by existing channels and sales models; defining shortcomings of the current channel for these end consumers; and determining recommended changes in sales organization, channel partnerships, infrastructure requirements, and expected costs and benefits.
  • For a leading home goods brand conglomerate, L.E.K. developed the vision, strategy and supporting case to create a new direct-to-consumer online brand and business unit. In order to ensure the company’s continued relevance with millennials, and as a defensive measure against disruptive upstarts, our analysis dictated a distinct business unit with its own brand and commercial functions, decision autonomy, and financials — a major break from the status quo. We further outlined the key digital tools and content through which the brand would drive stronger direct relationships with end consumers, and developed a detailed road map to build out and staff the new business unit.
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