According to a Placer.ai study, the home center and home decor channels — home decor in this case including retailers from At Home to Bed Bath & Beyond to The Container Store — aren’t growing the way they did during the height of the COVID-19 pandemic but that doesn’t suggest consumers have abandoned them.
Among its conclusions, based on a comparison of the pre-pandemic first quarter 2019 store visit share and that for the first quarter of 2022:
- Off-price home furnishings brand HomeGoods, owned by TJX Cos., has made impressive foot traffic gains climbing from 25.8% to 32.8%, a 7% increase.
- HomeGoods sister company, Homesense, which carries a wider selection of furniture and utility fixtures such as chandeliers and bathtubs more than doubled from 0.7% to 1.8%.
- At Home increased from 8.5% to 11%.
- Bed Bath & Beyond fell from 28.6% to 18.2%.
- Ikea slid by half a point to 13.5%.
- Container Store stayed steady at 3%.
- Cost Plus was effectively flat at 6.1%.
- Ashley gained from 5.3% to 6.7%.
- Kirkland’s fell from 4.1% to 3.3%.
- Christmas Tree Shops slipped slightly from 3.8% to 3.6%.
As for the home center sector, Placer.ai indicated that a significant home improvement boom occurred during the pandemic, but, since March 2022, foot traffic growth at home improvement and hardware stores has stalled. Yet, even if foot traffic is no longer on the rise, the fact that the home center sector is even staying close to 2019 visit levels despite wider macroeconomic challenges speaks to the category’s long-term gains.
Placer added that retail success at storerunners such as Home Depot and Lowe’s have had in offsetting the impact of inflation by raising prices demonstrates the loyalty of their customer base. Traffic visit share among home center brands hasn’t shifted in a major way, with Home Depot just about flat at 43.2% in the Q1 2019 to Q1 2022 time frame and Lowe’s down about a point and a half to 32.5%. Menards slipped from 7.8% to 7.1% while Ace Hardware gained a bit from 5.3% to 5.5%. Tractor Supply visit share increased from 5.3% to 7.1%. Harbor Freight Tools visit share grew from 3.3% to 3.6% while Floor & Decor increased visit share from 0.8% to 1%.
Foot traffic at leading home decor brands decreased in September 2021 and has since stayed below pre-pandemic levels. Although it didn’t help home decor operators, inflation wasn’t necessarily the catalyst for the downturn, Placer.ai indicated. Instead, consumers may be hitting the brakes on home redecorating projects now that they no longer need to spend so much time indoors. In addition, the rise of off-price home decor brands may be a drag on offline performance in other segments of the sector.
