According to a recent Unity Marketing survey, nearly two-thirds of the brick-and-mortar furniture retailers surveyed agreed that online furniture retailers, like Wayfair, are their biggest competitive threat. Their concern is not completely unfounded – Wayfair has been extremely aggressive with their online paid search as well as their TV advertising. If you want a case study of furniture retailer growth success, Wayfair would be a good one. But there is another thing Wayfair is doing well other than their aggressive online strategy. They are also a force to be reckoned with in direct mail and make it a point to mention their investment in direct mail in each of their investor presentations.
But with all this aggressive advertising in both print and online media, what does Wayfair’s growth success mean for furniture retailers in rural areas? Is the threat still the same and, if so, how can brick and mortar retailers curb the influence of online furniture retailers?
The Rural Customer And Furniture
Should brick and mortar furniture retailers have concern over losing rural customers to online retailers? There is no easy answer to this question because it’s a question that needs to be asked on a case by case basis – but most definitely it’s a question that must be asked. According to consumer surveys, both Amazon and Wayfair have seen year-over-year growth in rural counties with 57% more rural consumers reporting they shop most often for furniture at Amazon and 75% more rural consumers reporting they shop most often at Wayfair.
The upwards trend for Wayfair and Amazon is not surprising given that furniture shoppers in rural counties tend to be younger and higher income than typical rural consumers. These rural millennials want an amazing selection of furniture at a great price. Quality and brands are important to them. In the chart below, we have compared reasons given by rural millennials for shopping with Wayfair, versus shopping with non-major retailers. As you can see, there are areas where Wayfair is strong and other areas where local retailers have an advantage, primarily with location and trustworthiness.
How Brick And Mortar Furniture Retailers Can Compete
Furniture stores have the advantage of offering a stellar in-person experience. Rural consumers are all about their family and community – with strong relationships playing an important role in their daily lives. It’s no surprise that rural millennials who shop local for their furniture reported that “trustworthy retailer” was a reason for choosing their favorite furniture store. Because these stores have this trust, the other items on the list, such as price, service, quality, promotions, and delivery should be a slam-dunk. Think about it – wouldn’t you feel better about having your furniture delivered by someone you trust versus an online retailer? Wouldn’t you trust the quality of a product sold by someone you trust over that of an online retailer? If brick and mortar retailers emphasize the trust and amazing services offered by their stores, they will be in a much better position to compete against larger online retailers.
“Like social media, direct mail offers insightful data and targeting, but the average response rates for direct mail are currently at 5.1% (for a house list) versus 0.4% for social media.”
It’s Not About Going Online
As we mentioned before, Wayfair has been a force to be reckoned with when it comes to online ads. So, for local retailers that think they can go against Wayfair online and come out on top – the results might be a bit disappointing.
What does work is reaching rural millennials via the mailbox, which might come as a surprise to those of us who’ve watched our millennial family members browse Instagram all day long – assuming digital media is the better way to reach these young adults. And for rural millennials, Instagram is certainly a part of their weekly routine. They are 60% more likely than all U.S. adults 18+ to have used Instagram in the last 7 days and they are 62% more likely than all U.S. adults 18+ to have used the app more than 16 times in the last month. Although these numbers are impressive, rural millennials are still 49% less likely than their urban counterparts to have used Instagram in the last 7 days and 64% less likely than their urban counterparts to have used it 16 or more times in the last month.
Although this gap in Instagram usage exists between rural and urban millennials, there is no gap when it comes to the mailbox – both rural and urban millennials are equally likely to read their mail weekly. What’s missing from many conversations is that what social media can do, in terms of using insightful data to make smart audience targeting decisions, direct mail can also do – in many ways. With this direct mail capability, furniture stores have a truly tangible way for rural millennials to discover new things based on their interests – not to mention average response rates for direct mail are currently at 5.1% (for a house list) versus 0.4% for social media. This is a great testament to the power of direct mail, especially when it can be used to target very specific demographics in very specific regions. A brick and mortar furniture retailer need not outbid large online retailers for access to a mailbox – everyone is equal in the mailbox, and mom and pop stores can own their immediate market easily.
“A brick and mortar furniture retailer need not outbid large online retailers for access to a mailbox – everyone is equal in the mailbox and mom and pop stores can own their immediate market easily.”
How do Furniture Retailers Attract Rural Customers?
Other retailers can absolutely compete with online furniture retailers – especially in Rural America. Three brick and mortar retailers – Rooms to Go, Ashley Furniture, and Badcock – and one online retailer included in the above “shop most often” graph are among Mspark’s furniture clients. Each has maintained or experienced substantial growth in Rural America. Why is that? It’s simple: print drives foot traffic and rural consumers tend to appreciate the one-on-one customer service. With a little rural insight and a great direct mail strategy, other furniture retailers will have the ability to provide rural consumers with an alternative to jumping on a website and browsing. Instead they can position themselves as great service providers and give the client the one-on-one customer service they tend to appreciate.
Mspark understands how to advertise your furniture store to the rural customer. Want proof? Download the furniture store success stories below for detailed direct mail campaign results.
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Unity Marketing, “Furniture Retailing in an Internet-Disrupted Market”, 2018
Prosper Insights & Analytics, 2018
NHCS Adult Study, 2018
DMA Response Rate Report, 2017