1. The Online Furniture and Home Décor Market in India is expected to boom with the increasing demand in Tier 2 and Tier 3 cities and the entry of new players in the segment.
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The e-retail business in India is being boosted by increasing digitization and technology improvements, such as the 4G tech. Growing demand for home decor products from Tier 2 and Tier 3 cities have attracted more suppliers to the market. As a result, several new players such as Godrej Interio, etc. have entered the online market in the last 2 years owing to the Covid-19 pandemic. Due to this, India’s Online Furniture and Home Décor market grew at a CAGR of ~26% from 2016 to 2022. The industry is highly expected to witness tremendous growth in the next five years owing to the adoption of e-commerce. Furniture companies would also focus on a robust supply chain and supportive logistic infrastructure to cater to increasing demand. Moreover, Apps and portals would focus on AR & VR tech to help the customers visualize and select the best pieces of furniture, which will further fuel the demand in the future.
2. The Indian online home furniture market dominates the industry with the highest sales due to the increasing demand for household furniture.
Rising per capita income of the middle class and increased desire among homeowners for a well-set-up house and stylish interior, are boosting the Indian home furniture market. Presently, the Indian online home furniture segment accounts for more than 60% of sales and is growing significantly owing to the channelized process of production, distribution, and selling and increasing demand for household furniture. Also, one of the primary factors that are driving the growth of the sector is the work-from-home culture adopted by the corporates leading to an increase in the demand for multifunctional furniture.
3. Low Trust in Online Retailers and High Delivery Time have been the major bottlenecks in the industry
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Unlike furniture shops, an online retailer does not provide the comfort of touch and feel experience to customers. This is a huge drawback for online retailers in India, as customers here like to touch and feel any product before buying. Therefore, e-tailers must struggle to gain the confidence of new customers and retain loyal customers.
Also, usually, furniture delivery takes time as most of the retailer production houses are located far away from the cities. This poses an inconvenience to deliver the items quickly. However, to compensate for the long delivery issue, retailers offer additional services, like free home delivery, delivery tracking, and an easy return policy. Additionally, purchasing furniture involves big expenses, including advance payment. Customers need to make online advance payments for buying furniture online, which somewhere deters customers from shopping from online retailers. However, many retailers offer easy financing options and EMIs to combat this issue.
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