Retailers share game-changing strategies at Furniture Today conference
In December, 350 furniture manufacturers and retailers listened to and participated in a series of "Game Changer" themed presentations at the 14th annual Furniture Today Leadership Conference. The event, held at the Ritz-Carlton Beach resort in Naples, Fla., included two and a half days of seminar programs and networking; a salute to Havertys, Furniture Today's Retailer of the Year; and a tour of the new Clive Daniel Home store, operated by Clive and Dan Lubner in a former Robb & Stucky location.
Online - Wayfair, Gilt Home
Panel presentations focused on innovative retailers that have successfully managed their companies through the economic downturn. Representing the online segment were Michael O'Hanlon, vice president of business development for Wayfair (formerly CSN Stores), and Gilt Home's general manager, Jason Goldberger.
Last year, Wayfair surpassed Crate & Barrel in U.S. industry rankings to become the No. 2 online retailer of home furnishings and housewares, based on annual sales. Over the past two years, the company has grown more than 50% annually. O'Hanlon discussed three of Wayfair's game-changing tactics - a steadily expanding selection of products, investing for the long term, and partnering with potential competitors. He also presented an overview of Wayfair's "Get It Near Me" advertising program, which steers its non-shopping "researchers," 98% of Wayfair's visitors according to O'Hanlon, to brick and mortar retail partners.
In a separate presentation on collaboration and social networking, Gilt Home's Goldberger talked about the fast-growing and increasingly crowded flash sales field, citing the success of parent Gilt Groupe. Seventy percent of Gilt Groupe's 5 million shoppers are female, average shopper's age is 38, 60% are younger than 35, 77% are married, 50% have at least one child, and 47% have an average annual household income of at least $100,000.
Top sellers at Gilt Home are furniture, rugs, domestics, decorative accessories and housewares, through partnerships with vendors such as Missoni, Safavieh, Frette, Michael Aram, Arteriors Home, Kravet, Stark Carpet and Andrew Martin. Goldberger said the home category will only get bigger for Gilt, with bedding, lighting, framed art and housewares as its top expansion categories.
Goldberger said he's often asked if people really buy sofas online, to which he answers "absolutely." Gilt Home sells sofas every day, he said, many for more than $4,000, adding that online shopping for the home customer is now "part of her normal shopping pattern."
Multichannel - HGTV
HGTV executive Ron Feinbaum, designer/consultant Jena Hall and Bassett Furniture president and CEO Ron Spilman discussed the network's licensed product lines, including its new HGTV Home furniture line that will be unveiled at the next premarket in High Point. The line will include case goods and upholstery, bring HGTV's "makeover" and "reveal" concepts to life in stores, and be promoted with HGTV signage.
In 2011, HGTV debuted HGTV Magazine, and launched three anchor product categories: Paint with Sherwin Williams, bedding with Bed Bath & Beyond, and flooring with Shaw. Product launches in 2012 will include lighting, decorative accessories, live plants, exterior paint and wallpaper, according to Feinbaum.
From a marketing perspective, HGTV translated its own research on lifestyles and life stages into specific style categories by collections, with regional appeal. Hall said the "life stage" factor has the potential to cause consumers to cross over to styles not previously considered in past market research. In providing a snapshot of its market, Feinbaum said HGTV reaches 50% of women age 25-54 in the United States at least once a month, and the company's fastest-growing market shares are split between Generation X and Generation Y, with Generation Y having the largest potential in terms of size.
Brick and mortar - "The Strivers"
A panel presentation on the value of participating in a retail performance group was given by members of "The Strivers," which got its start in 1995 as a brainstorming, networking and benchmarking group made up of family-owned furniture retailers. Today the group, which shares just about everything except geographic sales markets, numbers 14 members, four of whom shared the stage in Naples: Gary Steinhafel, Steinhafels Furniture Superstore; Ron Cardi, Cardi's Furniture; John Schultz, John Schultz Furniture & Mattress; and Ed Darcy, Mealey's Furniture. In the audience was Bob George, president of Impact Consulting Services, the Atlanta-based company that facilitates The Strivers' reporting and semi-annual roundtable meetings.
The Strivers' purpose is to help members improve their operations. They do this by sharing financial data to compare retail performance, by exchanging ideas and constructive criticism to boost the line items that appear to be in need of improvement, and by providing personal and professional support to each other year-round.
Bound by confidentiality agreements, most of the members, whose combined sales volume is close to $3 billion, have been with the group since its inception. All of the members report their profit and loss statements to each other using a chart of accounts developed for the group by Impact Consulting. "The power of networking on a P&L basis is so incredible because every one of us has strengths and opportunities," Steinhafel said. "I'll see someone has a line item that's significantly different than ours and, depending on the opportunity, we may send a team to the member who is the best at it or, conversely, a member retailer may send people to visit us and look into our operations or that one specific item. We look at those and try to find the person doing the best job. It has really benefited all of our businesses."
"With this group you get perspectives you may have never thought about," Darcy added. "You didn't think about it that way because of the difference in size or geographic areas of the business. Really the game changer here for us, and me personally, is it just opens your mind up to new ideas."
The Strivers' members shared advice for retailers interested in starting their own groups, beginning with enlisting the services of an outside consulting company. "One thing Impact (Consulting Services) does is make sure our financials are all in alignment - that we're all putting the same things in the same categories," Steinhafel said. "And it's important to have a good moderator, separate from the group, who keeps us on task, knows when to end a discussion that's gone on too long."
Havertys and Clive Daniel are among the stores featured in this month's Retail Profile pages (pages 22 to 28). For more on Wayfair's "Get It Near Me" campaign, check out Retail Ideas That Work.