IBM forecasts 16.6% 2Q gain in home furnishings sales
April 6, 2012-- Furniture Today,
ARMONK, N.Y. — Home furnishings sales online and in stores are expected to jump a combined 16.6% in the second quarter of this year over last year, according to an IBM forecast.
IBM cited weddings in the Chinese "Year of the Dragon" and a trend toward accessorizing as among the "important factors that could be driving purchases."
The forecast does not break out the furniture category and lumps into home furnishing such non-furniture categories as soft goods, linens and plates.
In a release, IBM said in-store home furnishings sales are expected to jump nearly 8% to $23.2 billion, while online sales will increase 28.4%. It did not release a dollar estimate for online sales.
For the first quarter, IBM forecast a store-only sales increase of about 10.3% and a combined increase of 13.2%, although it said it does not publish a home furnishings forecast every quarter.
IBM said its retail and analytics experts expect several trends to bolster sales in the category in the second quarter, including accessorizing, which it said is moving from the apparel market into home furnishings; an increase in popularity of smaller homes, which leads consumer to "resize" their furniture for smaller spaces; more consumer disposable income as the employment picture improves; and increased rental activity, which can lead to furniture and other home décor purchases.
Jill Puleri, global retail leader for IBM Global Business Services, noted that the Year of the Dragon, which began Feb. 4, is a popular year for weddings, which also could boost sales.
Asked if this year on the Chinese zodiac is really that important in the United States, Puleri said yes, and that the Year of the Dragon "is precipitating big life events among U.S. populations ... and is not restricted to one culture."
"We have been looking at in-store data from the home furnishings category for the past 22 years," she said. "When we look up the data from 12 years ago - the last Year of the Dragon in 2000 - here was a spike in home furnishings sales as well."
In a release, IBM said the forecast is produced using "statistical and analytical software to evaluate both the long-term sales trend and seasonal peaks." It uses economic data from the U.S. Census Bureau in formulating the stores sales forecast.
The online forecast is based on peer-level benchmarking, measuring online marketing results, including sales data from the websites of more than 500 leading U.S. retailers, the company said.
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