The overall furniture market in India is valued at USD 16 billion (Rs 1.3 lakh crore), and poised to double by 2027. The organized part of that market, by value, stood at Rs 50,000 crore in 2019, as per estimates by PwC, which further projects the organized market to grow to Rs 1,95,200 crore by 2035. The big opportunity: in spite of newer players entering the market, branded companies sell only a tenth of all furniture sold in India. New players coming in will further accelerate the shift from the unorganized to organized sector, because consumers would be inclined to explore what all is available before making their decision.
Technology trends shaping the growth of Furniture Industry in India
The crisis has altered the way people shop by adapting to new technologies. Furniture shopping is now a virtually enabled buying experience from a purely physical one. Today, online selling is done through website product images with self-explanatory labels on them with people shopping from the convenience of their mobile phones or tablets. Thus, a state-of-the-art website that is optimised for all the critical stages of the customer journey is non-negotiable in this day and age.
AI and targeting algorithms can improve everyday experiences for customers – transforming the customer experience by providing personalized content, allowing for automated selling assistance and empowering self-service.
Virtual Reality (VR) has been an emerging trend over the past few years and offers immersive solutions for the building industry, enabling stakeholders to collaborate in the design process. For those companies who start using it now, it will transform how they project and build. This could be a true game changer.
Furniture industry in India in the next five Years
Home Décor is the largest category of furniture market, with a market volume of USD 1.75 billion in 2023. One factor that we believe will contribute to its long-term growth is the millions of millennials who plan to purchase their first home within the next three to five years. To capitalise on this tremendous market driver, it is vital to pay careful attention to the purchasing habits of millennial consumers and make the required adjustments to win market share. Businesses all over the world will have to evolve to attract the new generation customers. The furniture industry is no exception.
On the customer experience front, prioritizing digital merchandising and online presence will eventually help companies navigate through the ever-changing consumer landscape. The website will play a crucial role but so will new outreach methods like webinars or even podcasts. A truly omni-channel experience will emerge, that will encompass virtual product tours, 360-view showrooms, and online consultancies.
All this will increasingly become a basic expectation and companies that will embrace new technologies for enhanced customer experience will emerge as clear winners.
In the coming years, we also predict a surge in the online home decor market. According to a report by Research and Markets, the global market for online home decor was estimated at USD 98.4 billion in 2020 amid COVID-19 and is projected to reach a revised rise of USD 348.3 billion by 2027. A larger integration into the home décor space is something that a lot of furniture players will be looking into, to tap into the opportunity. The customer journey for home décor has significant overlaps with the furniture journey and hence this seems like a sensible integration.
On the product front, eco-friendly, customer friendly, easy to handle, and multifunctional furniture have a promising future. Also, as newer segments of consumers emerge, the ability to target these niche segments in a sustainable, profitable manner will become increasingly important. Having said that, I believe that good designs that are long lasting, durable, and aesthetically pleasing will never go out of style.
Lastly, there will be an ongoing and significant shift of consumers from the unorganised to organised space in the next five years. As more and more consumers move from the unorganised to the organised space, some of the core needs for the category like well designed, long lasting furniture will continue to exist. At the same time, brands that bring in the right mix of quality and aesthetics in their product range, enhance customer experience through adoption of technology, and continue to innovate in their systems and processes will continue to win.
