With pop-ups, Wayfair hopes to ace real-life experiences
Wayfair says it is opening two pop-up stores next month, joining a growing number of e-commerce brands looking to gain sales with a brick-and-mortar presence.
And experts say that the fast-growing furniture brand may have even more at stake than other internet businesses, as consumers struggle with the inherent complexities of online shopping for couches, carpets and dining room tables.
“The furniture category is obviously very high-touch,” says Matt Sargent, senior vice president of retail at Magid, a research consultancy. “And while the pure internet companies have been very successful so far, there’s only a relatively small base of people willing to shop this way. To expand beyond that, there needs to be something [shoppers] can experience in the physical realm.”
It’s also another way for e-commerce brands to dethrone brick-and-mortar stores.
“Physically engaging with customers highlights the biggest advantage traditional retailers have when compared to digital newcomers,” he tells Marketing Daily.
The Boston-based Wayfair, which recently opened a single store in Florence, Kentucky for close-outs and returns, has said it has no plans to open actual showrooms, as online mattress marketer Casper has. (That company is planning 200 stores throughout the U.S.)
The holiday-themed shops are scheduled to open in the Natick Mall in Natick, Mass., and the Westfield Garden State Plaza in Paramus, N.J.
Plans call for the small installations to have home-design experts on hand, helping consumers explore Wayfair’s e-design platform; a “How-To” station for home improvement products; and over 100 fabric swatches for custom furniture. While there will be no merchandise for sale, shoppers can buy Wayfair gift cards.
“For the first time ever, shoppers will be able to step into the world of Wayfair,” says Ed Macri, chief product and marketing officer, Wayfair, in its announcement. “Building on the success of our television advertising and direct mail, this pop-up experience is yet another way we are deepening engagement with customers beyond our online presence.”
Sargent says another reason physical stores matter more to companies like Wayfair is that private-label brands are increasingly important to growth.
He says Magid has tested customer awareness and consideration for home decor brands among retailers, finding that while Wayfair’s brands have strong consideration among those who know the brand, overall awareness is low. Target, for example, has both a 68% awareness and purchase consideration for its Room Essentials line and Bed Bath & Beyond 58% awareness and 67% consideration.
“Wayfair’s brands struggle to get to even 30% awareness,” he says. “It’s easy to see why Wayfair is in search of exposure for their own brands.”
Wall Street analysts have also noted Wayfair’s need to find new and more affordable, ways to acquire customers. Intensifying competition and a tougher digital advertising landscape are making it more expensive, writes Seth Basham, an analyst who follows Wayfair for Wedbush Securities. Retail showrooms might be one way to stem “the recent decline in net new customer growth, driven by increasing customer churn and slowing customer activations.”
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