Why Can American Home Decoration Retail Be Protected From The Amazon Effect?

July 2016

Decorative retail sales increased by 6.4% over the same period last year, which is in sharp contrast to the US Department of Commerce's announcement of July's insipid retail sales figures.

Analysts predict that home decor and DIY sales will continue to rise, while Home Depot (Jia Debao)'s second quarter sales forecast will rise 4.8%, while its rival Lowe 's is expected to rise 4%.

According to data cited by FactSet, these chain stores have increased by more than 4% over the past eighth months.

It looks like home decoration.

It is not affected by the so-called Amazon effect.

Reporters pointed out that "Amazon effect" let different categories of retailers fight a price war.

In the Great Depression

In the rising era, almost every product became a commodity. In this case, the price became the best way to distinguish the goods, while the courtyard and the home building materials store were basically free from the impact of the turbulence.

The reasons are psychological and realistic.

Psychological reasons: many homeowners do not regard spending on the house as a luxury or casual purchase, but rather an investment.

Practical reasons: shoppers still feel the need to pick up products in the home decoration shop in person, for example, when choosing the color of paint.

In addition, about 2/3 of the houses in the United States are old houses, requiring more maintenance, and low loan interest rates and rising housing prices also make such expenditures very valuable.

However, considering that more and more customers are buying home decoration products on Amazon, the Amazon effect may eventually spread to the industry.

According to a study by UBS (Union Bank of Switzerland), 11% of the customers with decoration plan are going to buy on Amazon, which is 7% higher than that of a few months ago.

Home decorating retailers may also receive challenges from other competitors.

In May of this year, J.C. Penney announced that it would turn 25% of its flooring business into window decoration business, including curtains, shutters, pleated curtains and hardware.

It is said that before the great depression, 1/3 of families in the United States were using J.C. Penney's window ornaments.