Wayfair was clearly a force to be reckoned with before the pandemic – but with repeated lockdowns helping catapult its customer base past the 30 million mark, the Boston-born etailer has truly cemented its hold on the global homewares market. In this exclusive interview, Furniture News asks Wayfair’s head of Europe, Martin Reiter, what’s to come – and if the UK’s furniture retailers should be worried …
How has Covid-19 catalysed Wayfair’s ascendancy, and what role does the UK business play in the global picture?
It’s definitely been a stratospheric year. Covid-19 created a unique set of circumstances and home became the epicentre of everyone’s lives, highlighting the attractiveness of Wayfair’s value proposition to our customers. Many people turned to online shopping for the home for the first time, both in the UK and across our other global locations.
During this period, the number of active customers has grown globally by +53.7% to more than 31 million – new, and loyal. In Europe, we have hit a net revenue run rate of more than $1b, and the UK has played a key part of that growth.
Covid undoubtedly catalysed Wayfair’s ascendancy to some degree, but we were uniquely positioned to meet unprecedented demand due to our scale and the strategic investments and long-term orientation that we’ve made over the years – particularly in our large, flexible supply chain network, and scalable, agile tech infrastructure.
How has Wayfair changed in response to the pandemic?
The complex Covid-19 period definitely enhanced our already close alliance with our more-than 12,000 suppliers – 3000 of which are based in Europe. We have doubled down on communication, sharing real-time guidance that enabled many of our suppliers to remain open and operational. We continued to diversify, expanding our core catalogue of furniture and decor as well as housewares, renovation, plumbing and more, so customers can continue to meet all their home needs in one simple-to-use online destination.
With our customers spending so much time at home navigating lockdown life, we have also tried to tailor our marketing strategy to answer their changing needs and to sensitively recognise the challenges that everyone has been facing. We’ve run a number of Covid-19 response campaigns across our channels, including our Happy at Home campaign, which aimed to offer support, guiding customers on the best ways to reconfigure and organise their spaces for productivity, comfort and wellbeing – from practical guidance on how to set up a quick and easy home office in the garden, to inspiration on how to integrate mood-boosting colour.
We’ve continued to offer exceptional value, particularly through major sales like Way Day, which just returned this April. We’ve also run a number of charitable efforts including our Save Big, Give Back campaign, where we donated a proportion of profits to Unicef to help with critical Covid-19 relief. These approaches have been hugely well received, and a lot of the pivots that we made will be here to stay in 2021.
Is there any reason UK retailers shouldn’t see Wayfair as their greatest threat?
Since Wayfair’s conception, we’ve been focused on building a world-class online homeware destination that will transform the way consumers shop for their homes, and this has really been pivotal to our success, and is what sets us apart, I think.
We work with our family of suppliers to ensure that we have the very widest selection of homeware available on-site, with more than 22 million items available worldwide – a million of which are available to UK shoppers. We’re also constantly striving to deliver excellent value.
Beyond this, we have been super-focused on delivering an exceptional retail experience, through technology, inspiring merchandising and a fast, frictionless delivery experience via our proprietary logistics infrastructure. This recipe continues to garner results for both us and our suppliers. In addition, we have always been, and we remain, heavily focused on the long term, investing decisively and strategically in our future.
Are we the biggest threat to UK retail? I would like to think we are actually a platform that can help many home retailers, big and small.
Has the balance of online and in-store shopping shifted for good? And how much further can it go?
While the pandemic has definitely boosted demand for homeware, especially within the online sector, customers acquired during Covid still appear to look similar to other recent cohorts in terms of repeat trends.
Looking beyond the acute pandemic period, we fully expect that Wayfair will benefit from having a relationship with each of these customers, and that we will be able to engage with them in highly personalised ways, as we’ve always done.
Ultimately, we’re decisively tackling a huge market opportunity for ecommerce in home and living – of $49b in the UK. We remain focused on delivering an exceptional shopping experience, growing our customer base, and are super-excited about the opportunity ahead.
What qualities do you look for in a supplier, and how might they best work with you?
Whether you’re a large-scale manufacturer or a small business, our aim is to help suppliers with or without storefronts across all EU markets access fuss-free dropshipping, red carpet merchandising, brand curation and powerful promotions and marketing – without any capital investment in sales teams, operations or physical presence in the UK and Germany.
Our business model is based on driving ultimate selection, so we are extremely receptive to onboarding suppliers, big and small. My advice would be, if you’re looking to expand your market presence in the UK and Germany, becoming a Wayfair supplier will help drive your online sales while taking all the ecommerce work off your shoulders.
We recommend that our suppliers follow our recipe for success, and those that do invariably see strong results.
Aside from garden chairs and patio heaters, what’s selling particularly (or surprisingly) well right now?
We’ve seen an enormous surge in interest in garden lines, peaking earlier than ever, presumably in response to the imminent lifting of lockdown restrictions and the prospect of al fresco entertaining being back on the table again.
In fact, the vast majority of our fastest-growing classes have been outdoor focused. This spans everything from dining furniture and parasols to deck boxes, ice boxes, tabletop pieces, outdoor rugs and cushions. We’ve also seen a big trend for tiki-style garden bars and potting benches. Lockdown might be easing, but it seems like customers are still keen to create a safe and fun space to entertain at home.
Have you made many advances in onboarding home and living brands in the past year?
We have added more than a thousand additional home and living suppliers, representing a mix across all categories, styles and price points to match our broad customer base.
Key brands from the UK have included SMEG, Russel Hobbs, Chilewich, Mama Designs, Soda Stream, Ideal Standard and Abode, broadening selection in our furniture, kitchen and housewares, as well as plumbing and renovation categories. Our European supplier base now stands at more than 4000, and is constantly growing.
How much power do you have to influence trends – as opposed to simply following them?
With more than a million home items available in the UK across every style and price point, and with technology at the core of our business DNA, we are uniquely positioned to be able to access a wealth of search and sales data that very much informs our trend forecasting.
We see an unprecedented volume of homeware, so are able to get a very strong read on trends before they come to market. That being said, we strongly believe that Wayfair gives everyone the power to create spaces that are just right for them. We’re a destination for all types of customer, across all styles and budgets, so to some degree, while we have a strong read on the trends, we never discriminate. Everyone and every style is welcome.
How do Wayfair’s UK marketing activities break down, across various media and channels?
We’ve built robust marketing programmes across every stage of the customer purchase funnel, and continue to invest decisively to drive awareness and maximise impact. In the UK, we are investing strategically across a wide marketing mix, both above and below the line.
Our main focus in 2021 will be on continuing the momentum we have established and providing a great customer experience.
What’s the most crucial part of the ecommerce puzzle – platform, product, promotion … or something else?
That’s a great question, but it’s impossible to single out one part of the puzzle. Everything works in mutual symbiosis. For me, delivering exceptional customer service is also really key.
Can you reveal the scale of your ambitions across the furniture and furnishings sector, and suggest how and when they might be achieved?
We remain laser-focused on the huge home category TAM [total available/addressable market], where furniture and furnishings play a key part. Our ambition is to reinforce our winning platform for both customers and suppliers, and effectively balance growth, profitability, and high ROI investments for many years to come.
We saw the benefits of this approach in 2020, and are excited to see what 2021 has in store. There’s everything to play for …
This interview was published in the May 2021 issue of Furniture News magazine.
