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According to a survey results published by Bank of America on Tuesday, retail leaders are consolidating market share in home furnishings.
The bank’s analysts indicated that the top 10 brands have amassed a 53% market share in home furnishings, up from 47% in 2016. Walmart (WMT), Amazon (AMZN), and Target (TGT) were cited as the top retailers in home furnishings products, cementing their place atop the retail totem pole amidst the pandemic.
“Since 2019, Amazon, Wayfair (NYSE:W) and Target have gained the most share (all +100bps+) while Bed Bath & Beyond (NASDAQ:BBBY) shed ~400bps,” the analysis noted.
The team also noted that Williams Sonoma (NYSE:WSM) increased its market share by 1% as compared to 2019 and continued a strong trajectory for revenues into 2022. However, a step back is expected as the retailer did not place atop the planned purchase locations in the bank’s surveys. Costco (COST), Macy’s (M) and Arhaus (ARHS) saw “the largest increases in where respondents plan to buy furnishings in 2023” with increases of 240, 150, and 140 basis points respectively. Conversely, Walmart, Target, Bed Bath & Beyond saw the biggest decreases in planned spending for the year ahead.
“ARHS’ gains are most notable given its low relative market share. Relative to the last survey, trends for Wayfair improved,” the analysts noted. “As of 4Q22, Wayfair outperformed the market for the first time since early COVID.”
Still, home furnishing spend overall is expected to dip in 2023 amid macro uncertainty. While high-income survey respondents are still eyeing purchases, middle-income respondents indicated a significant decrease in their appetite for home furnishing spending. Per the survey, 51% of middle income consumers will buy less or no furnishings in 2023 as compared to 41% responding the same way in the prior year survey.
Read more on Arhaus’ latest earnings results.
