Home is where the demand is. In the last few years, the home and housewares market in India has picked up significantly. One of the key reasons for the same is consumers in India no longer purchase home products only during major festivals. Today, frequency and patterns of purchase of housewares and home products have changed drastically, thanks to the increased purchasing power and aspirational lifestyle of consumers.

Riding on the high demand, the home textiles, furnishing, home décor and housewares products market is growing at a healthy 25% - 30% annually. India’s domestic home textiles and home furnishings market is growing at an annual rate of 40% and is projected to exceed US $13 billion by 2025.

Consumers in India no longer purchase home products only during major festivals. Frequency and patterns of purchase of housewares and home products have changed drastically, thanks to the increased purchasing power and aspirational lifestyle of consumers.

The demand for home products is likely to witness an exponential growth due to the construction of over 30 million new homes over the next few years due to Government of India’s aim to provide ‘Housing for all by 2022’.

Also read: Smart home trends

Market potential

India is the world’s third-largest economy next only to USA and China in terms of GDP-based purchasing power parity. The population of over one billion out of which 65% are youngsters who are known for an affinity for branded international products, makes India a very attractive market for global brands.

Growth drivers 

• Increasing disposable incomes
• Proliferation of nuclear families
• Government policy of affordable housing for all by 2022
• The rapid growth of e-commerce and modern retail.
  
  

Vital statistics 

• Revenue in the furniture and homeware segment amounts to US$722m in 2019.
• Revenue is expected to show an annual growth rate (CAGR 2019-2024) of 15.2%, resulting in a market volume of US$1,462m by 2024.
• User penetration is 10.0% in 2019 and is expected to hit 21.0% by 2024.
• The average revenue per user (ARPU) currently amounts to US$5.27.
• In global comparison, most revenue is generated in China (US$105,672m in 2019).
  
  

Also read: Housewares trends to watch out for

What Indians want

Home fashion seems to be following a path similar to Fashion Apparel with young Indians preferring products that are trendy, unique and reflecting their personalities. The demand for high quality, stylish and well-coordinated home products is on the rise. And it is coming from young couples not just from the metros but even from tier-III towns. Singles living away from home and staying in rented homes too are fuelling the demand for home and housewares products.

Today’s consumers know what they want in terms of materials, colours and design and are willing to spend the time and effort to scout for it online as well as offline.

Online action

Furniture was one of the first few categories to go online when the e-commerce boom picked up in 2011. Here, furniture and homeware includes furniture, kitchen and household goods such as kitchen and bathroom accessories, textile furnishings, lamps, decoration, candles, pottery and china.

Pepperfry opened its online shop in 2011; Urban Ladder and Fab Furnish followed suit the very next year. Livspace entered the scene in 2014.

Till then, furniture as a category was highly unorganised. While there were advantages to selling furniture online like the ability to showcase a much wider range and convenience, it had its unique sets of challenges. These include the cost of building the entire supply chain, cost of customisation of furniture, issues with installation and storage and transport of bulky items. High marketing spends and deep discounts did not help the cause. Also, the delivery cycles were longer, which compelled many players to open physical stores. While Fabfurnish had to shut shop, the other players received funding and continue to be in business. However, Ikea’s entry in India froze the flow of the funds. However, the unorganised sector continues to be real competition. In August 2019, Ikea launched online shopping in Mumbai before it opening a physical store in the city, which is a first for the Swedish multi-national company in the Indian market. With this, things are getting very interesting in the online furniture market.

The Indian home and housewares market is at an interesting juncture and things are expected to get only better from here.

Also read: Home and housewares consumer buying trends

Image source: shutterstock.com

Article published in STOrai Magazine. 

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