At this point, the retail industry is well aware of how enamored Gen Z consumers are with retail segments like skincare and apparel. This can be seen in the popularity of brands like Glossier and American Eagle with this consumer base.
One retail category that has been garnering more attention from this younger consumer group recently is the home goods market.
Despite the societal narrative that Gen Zers are flighty and unlikely to settle down, studies show that in recent years the percentage of Gen Z homeowners has begun outpacing those of their older counterparts, millennials.
A study conducted by Redfin, a real estate brokerage firm, revealed that in 2022, 30 per cent of Gen Zers owned their own home, compared to 27 per cent of Gen Xers and 28 per cent of millennials when they were the same age. By 2023, the same firm revealed that there are roughly 18 million Gen Z homeowners in the US, a number that will steadily continue to rise as this consumer group further ages into financial independence.
With Gen Z homeownership rates rising in recent years, research shows that these younger folk are catching up to their millennial and Gen X counterparts when it comes to purchasing rates for home goods and furnishings, which includes products ranging from bedspreads to furniture.
A survey conducted by the research organisation Consumer Insights Now revealed that in 2022 Gen Z made the most home furnishings purchases at 44 per cent.
Even for those shoppers within the Gen Z age group who are not able to or are not interested in owning their own home, there is still increased demand for these items thanks to the increased number of remote workers post-pandemic.
As an analyst with Market research firm Euromonitor noted, “The combination of accessible online platforms, personalised consultations, and trendy designs resonated with consumers, driving increased sales and solidifying DTC brands’ position as key players in the evolving home furnishings category.”
Where brands like Parachute are winning over millennials with consistent marketing and quality designs, businesses like Australian home goods brand Hommey are winning Gen Z shoppers through sustainably focused and flamboyantly designed stock-keeping units (SKUs).
Like many brand founders before him, Justin Kestelman, the founder of the modern soft furnishings and home goods brand Hommey, drew up the idea of the business from a personal place of interest.
Back when he was moving into a new apartment in 2020, Kestelman found himself going through the process of styling his new space and noticed a lack of modern, aesthetically pleasing options that fit his and his cohorts’ tastes.
So the founder decided to take matters into his own hands. He started by launching cushions created with ethically sourced, Oeko-Tex 100 materials and made with inserts that met responsible textile standards like Downpass and the Responsible Down Standard.
In addition to integrating sustainable sourcing and production methods, Hommey captures the younger homeowner or interior design enthusiast’s attention with its wide array of colourful hues and patterns.
Where brands like Parachute offer soothing shades of creams and browns for consumers with a more classic palette, Hommey has a more vibrant range of colours featuring pastel-hued tones or deliciously quirky striped combos, dubbed names like “Iced Chocolate” or “Rocky Road”.
Since launching its original array of cushions, the brand has also expanded with other boldly-designed home and lifestyle SKUs including bathrobes, pajamas, towels and more.
Hommey is just one of a few brands leaning into dopamine decor, an offshoot of “dopamine dressing” in which one decorates their home in colourful and whimsical designs to bring back childlike joy. Other brands include the Brooklyn-based textile and home goods brand Dusen Dusen, which also carries a unique array of patterned, eye-catching designs that grab onto the Gen Z shopper’s focus.
As 2024 comes to an end and businesses and consumers alike are gearing up for the year ahead, here is a key trend home goods retailers may want to tap into.
For the Gen Zers who aren’t moving into their own space, many have been moving back in with their parents or are living in multigenerational households.
According to Harris Poll for Bloomberg, roughly 45 per cent of people ages 18-29 are living at home with their families, the highest this figure has been since the 1940s.
“This shift,” as a Euromonitor analyst explained, “implies a growing need for homes to be better-equipped, leading to increased demand for home furnishings and renovations to accommodate people from different generations.
There is a growing market for items like sofa beds, which provide both affordability and versatility and storage furniture, which is driven by the convergence of consumer preferences for minimalistic aesthetics and sustainability.
The post Why Gen Z is a rapidly growing market for home goods retailers appeared first on Inside Retail Australia.
