NEW YORK— Besides a view to how Walmart.com is evolving, the inaugural Future of Home event provided insights into how households in the U.S. are changing and where the marketplace that serves those spaces may be heading, with carryover to the High Point Market already on tap.
Although how consumers will shop for home furnishings and housewares in the future was a key element of the Future of Home event, smart home was a major topic with Kate Freebairn, director of design, Google Nest, pointing out that refinement of personal assistant hardware and software will provide consumers new kinds of access to critical services and the retail marketplace. Google is getting ready to build on that event to the extent of developing its own branded line of products.
The High Point Market Authority was an event sponsor, and it is building on the relationship with a Future of Home seminar on the agenda for the Fall High Point Market. In New York, Tom Conely, HPMA president and CEO, said that the organization backed making Future of Home, a program aimed at educating interior designers about developments in the marketplace, expansive in terms of its agenda. As it ran over two days, the event provided an exchange of information wide enough to inform anyone involved in the housewares and home furnishings industries get a better grasp of how the industry is evolving.
In addressing the Future of Home audience, Conley said, “This should be a conversation that happens in all year long. This should be a conversation we should engage in with people across different business disciplines and different areas of interest so we can help to create our future and not let the future create us.”
He noted that HPMA would extend the Future of Home to High Point for the biennial furniture show, already scheduling a session on furniture rental and sustainability with Everset’s Gavin Steinberg and Megan Hopp for the fall market.
At the event’s open Andy Dunn, founder of Bonobos and now a senior executive at Walmart.com, provided an eye into changes taking place at the Bentonville giant’s e-commerce operation. In the aftermath of Walmart’s acquisition of Jet.com, Walmart emphasized pushing development of the online element of its omnichannel business, using more specific and targeted approaches to the market with an ongoing acquisition spree that also included the Bonobos apparel business. Now, however— and in the aftermath of Walmart’s successful curbside grocery pickup expansion and other omnichannel developments— Dunn said all online initiatives, from the outset, will tie into the brick-and-mortar store element.
In general, stores offer e-commerce operators an opportunity to allow a different kind of consumer engagement even as what has become standard customer acquisition online is becoming more expensive. However, the relationships emerging between e-commerce and stores is becoming increasingly complex as retailers recognize, sometimes through trial and error, that opportunities exist for those who can modify what has worked in a particular set of circumstances and see where else it might apply.
Dunn noted, for instance, that entrepreneurial-style direct to consumer brand building needs fresh consideration. Walmart developed an online mattress brand it launched with a core product priced at $800, he pointed out, and no one was interested in it. Walmart.com’s Marc Lore suggested cutting the price dramatically, with the ticket plummeting to $319 after management reset margin and marketing numbers. At that price, Walmart sold 20 times more in a weekend than it had in the several months when the mattress carried an $800 ticket.
From there, Dunn said, the team overseeing what had been a Walmart direct-to-consumer brand for the e-commerce consumer brought the program to Walmart’s store merchants. They expressed interest in the mattresses but even more in the mattress toppers included in the program. Happy with the merchant interest, the brand runners prepared to get a mattress topper order of $1 million to maybe $2 million, Dunn said. The merchants responded with an order for $52 million.
“That was the beginning of this realization that we need to actually build beautiful direct to consumer brands that are going to be accessible to a much wider ecosystem of American shoppers,” he said. “Our new direction is figuring out how we build great brands that serve a much bigger customer base.”
Walmart.com now is considering how to configure direct to consumer brands that may suit advancing household needs and, in so doing, the lifestyle preferences, of many mass-market shoppers, but at prices attuned to their budgets.
JetBlack, a product of Walmart’s Store No. 8 enterprise incubator, is finding means of supporting the lifestyle of busy affluent consumers.
In the “Future of Affluent Consumer Behavior “seminar, Jenny Fleiss, an executive with Store No. 8 business incubator and co-founder and CEO of the recently introduced JetBlack text-based e-commerce platform, told the event audience that the business is enjoying success with subscribers, who continue signing up to pay a $50 per month service.
To a significant extent, she said, JetBlack borrows from the model of the traditional upscale specialty store, where trained employees work with customers to help them find products that best meet individual requirements, but updated and expanded across a range of common needs. To do that effectively, the operation uses human interaction, including initial phone conversations and even home visits, to set a consumer’s preferences, especially for everyday needs. Then JetBlack employs AI and machine learning in concert with human staffers to support an ongoing relationship with the customer. Because it becomes a personalized shopping experience across more than one category, JetBlack, ultimately, functions as a concierge, giving subscribers a single source for a range of purchases even to the extent of shopping multiple sources, whether connected to its own systems or even extending to local stores, and home delivering those purchases.
As it has advanced, JetBlack has been encouraging consumers to interact with it in a variety of ways through text. Fleiss said that text commerce, which provides its own insights, is evolving to a more broadly conversational interaction as, for example, subscribers use voice dictation in accessing the service.
“Say it’s back to school, and suddenly there is a list of 20 things you suddenly need,” she said. “Who has time to go to 10 different websites to find all those products, let alone remembering to do that? It’s a mental burden you carry, all your shopping to-dos. So, what if you just offload that? What if you take a screenshot or a photo of the school supply list and text it to JetBlack? You can do that, and we’ll tackle all of it for you.”
In an interview, Fleiss told HomeWorld Business, JetBlack has the flexibility to evolve as a service to the typically affluent and so far urban subscribers that it has so far because it operates as a stand-alone operation within the Store No. 8 structure and independent of Walmart.com. JetBlack has access to Walmart inventory and distribution support, but it is free to develop its own means of serving members.
In effect, Fleiss said that, although JetBlack is more focused on non-food consumables and occasion shopping right now, as in the case of gifts, the premise underlying the operation holds true for affluent urban consumers and perhaps affluent consumers generally: The commodity its subscribers miss more than money is time. Fleiss said JetBlack goes to great lengths so as not to say no to members. To put it another way, the future of home-related retailing will include a more intimate relationship with affluent and, perhaps over time, not-so-affluent consumers, supported by all that such cozying-up requires. Even if retailers serving the affluent consumer may take the lead, expectations will filter through the market and consumers generally will seek out shopping experiences that are more personal and efficient.
The shift in e-commerce to a service orientation was evident at Future of Home, with, for example, a panel including furniture rental company executives Michael Barlow, co-founder Fernish, Lucas Dickey, co-founder Fernish and Kyle Hoff, co-founder Floyd, discussing how younger consumers and frequent movers have come to view furnishings as something they might want to swap out rather than live with long term.
Furniture renters often are younger, less attached to possessions and desirous of personal freedom. However, younger free spirits aren’t the only consumers interested in furniture rentals, they said. Many furniture renters are people who live with roommates but more are living with roommates later in life than was previously the case. Indeed, many seniors who are retiring in place are inviting others to live with them to share costs and provide mutual personal and medical security. In addition, people furnishing second homes are a market for furniture rentals. And, furniture rental businesses may offer rent to own, just as rental businesses offer furniture, but the furniture rental specialists may offer a better and more stylish selection.