Online accounts for 10% of home furnishings market

Online purchasing only accounts for 10 percent of the home furnishings market, according to a recent report by Fluid and Wells Fargo.

The home furnishings market is worth more than $220 billion in the U.S., and online home is one of the fastest growing e-commerce categories, with 20 percent growth in 2013 and an expected 18 percent compound annual growth rate in the next 10 years. However, the study, which sourced 14 home retailers, found that digital was underutilized.

The report found that multichannel home furnishing retailers scored higher than pure online retailers in the search ability, product info and post-purchase categories. They also performed better in the areas of inspiration and content. However, pure online retailers scored higher than multichannel retailers in the categories that assess the shipping, fulfillment, customer service and mobile experience.

The study also found that there was a lack of "play interior designer" spaces in the online home furnishings division.

"We found that many retailers had best practice e-commerce sites but were not doing anything unique for their category," said Bridget Fahrland, VP of client strategy, Fluid. "Inspiration, trend and actual design planning are a key part of the home furnishing customer's decision process, but only Pottery Barn (NYSE:WSM) and West Elm stood out for having a unique feature like room planners."

In addition, the study found that the majority of home furnishing mobile experiences had little to offer other than a mobile-optimized site that replicates the desktop experience. The few exceptions included Crate & Barrel, West Elm and Bed Bath & Beyond. "While the pure plays had fairly good mobile presence, multichannel retailers had mobile-optimized sites at best for the most part. Given the cross-channel/cross-device nature of home furnishings, we would have expected more distinctive mobile experiences and stronger mobile apps," Fahrland said.

Finally, almost none of the websites examined had a community area for customers to discuss trends or ask questions—in an industry that definitely works off of both trends and opinions. An exception was West Elm, which has an integrated social feed for Pinterest activity.

Which retailers received the highest scores? "West Elm, Pottery Barn, Williams-Sonoma received high scores because of their visual design, focus on inspiration, content and product pages," Fahrland said. "World Market ranked high as well but for slightly different reasons. It was inspiring, but notably had great search, payment, fulfillment and customer service. Overstock and Amazon lead the pack for pure plays."

It's no surprise that Williams-Sonoma was a top contender. The company reported record-high revenues in fiscal 2013, up more than $4 billion. The retailer also reported the best holiday season in five years in early 2014, due in large part to an effective omnichannel strategy.

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