LONDON--(BUSINESS WIRE)--Technavio market research analysts forecast the global online home decor market to grow at a CAGR of close to 20% during the forecast period, according to their latest report.
The market study covers the present scenario and growth prospects of the global online home decor market for 2017-2021. The report also lists home furniture, home furnishing, and other decorative products as the three major product segments, of which the home furniture segment accounted for close to 48% of the market share in 2016.
According to Tamal Saha, a lead analyst at Technavio for furniture and home furnishing research, “The growth in the real estate and housing industry has had a directly proportional impact on the growth of the global furniture market. With increasing population and booming real estate industry worldwide, the furniture market has witnessed exponential growth over the last two decades. This growth will be further augmented with the increase in penetration of the Internet leading resulting in a boom in the online home décor market.”
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Technavio analysts highlight the following three market drivers that are contributing to the growth of the global online home decor market:
- Growing demand for premium furniture
- Increasing geographic expansion of regional and international marketers
- Growing real estate and housing industry
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Growing demand for premium furniture
At present, customers are opting for luxury furniture brands because of economic growth and increase in their purchasing power, thereby increasing the significance of home decor. High-end furniture is considered a status symbol by the premium and ultra-premium segment of consumers. Consumers are also opting for premium furniture for their home offices. The demand for luxury home decor is growing gradually in the emerging nations of APAC and MEA such as China, the UAE, and South Korea.
Globalization also plays an important role in driving the luxury furniture segment. For instance, the Italian design brand, Arper has opened a new showroom in New York, following the footsteps of other European brands that are setting up physical stores in the US. Moreover, with the price of luxury furniture on the rise, the leading vendors are earning high profit margins on every unit of product they sell.
Increasing geographic expansion of regional and international marketers
The global online home decor market experienced rapid globalization in recent years. This was mainly due to the establishment of global production networks by large manufacturers and retailers that seek to reduce their manufacturing costs. Globalization of the home decor market has been aided by technological innovations and the global reduction of trade and investment barriers.
In 2014, China was one of the top-selling markets for Inter IKEA Systems. The launch of Inter IKEA Systems stores in Morocco (2015), Jordan, Croatia, Indonesia, and South Korea (2014) makes the global expansion of manufacturing operations quite evident.
“The developing economies are particularly interested in attracting global vendors of home furniture and furnishings to the local markets. This will bring in new designs, styles, and varied home decor products, thereby encouraging consumers to buy home furnishings,” says Tamal.
Growing real estate and housing industry
The boom in real estate and the housing industry is one of the key factors that is driving the global home decor and furnishings market. The Indian real estate market is expected to exceed USD180 billion by 2020. The influx of Foreign Direct Investment (FDI) will also boost the market dynamics during the forecast period.
Residential investments have also grown in the European market over the past few years. In the UK, the rental sector has also experienced growing interest from students who are migrating to tier-1 cities for higher studies. This student pool represents one of the prominent categories of target audience who opt for rental houses and homestays, thus creating demand for the online home décor market.
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