SEATTLE - Amazon is moving more deeply into sales of bulkier non-traditional eecommerce items—including furniture, power tools, and home appliances.
Thought to be e-commerce resistant, these heavier categories are among the hold out categories at traditional brick and mortar retailers like Sears and Macy's. Amazon is reportedly building large warehouses specifically to handle larger volumes of furniture. The Seattle-based company is eyeing the succcess of online furniture retailers liket Wayfair and Williams-Sonoma in growing its business. It is already offering bedroom furniture, and Ashley sofas, among other items.
Amazon is accustomed to entering markets that are taking off. In custom woodworking it launched its version of Etsy, Handmade at Amazon, in 2015. A Martha Stewart American Made section opened within Handmade at Amazon soon after.
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ARTICLE Etsy is in the cross-hairs of online retail behemoth Amazon, which formally launched Handmade at Amazon, a retail site for hand crafted goods. |
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A recent study by One Click Retail, a Salt Lake City sales analytics firm, showed tools and home improvement markets with an overall growth rate of 35 percent for Amazon.com, much larger than the U.S. domestic market's total growth of 6 percent.. With many highly-connected young professionals new to home ownership and putting together their own woodshops from scratch, carpentry tools are in big demand right now. This helps to drive Amazon's sales in Woodworking (30 percent), Tool Organization & Garage Storage (35 percent) and Power Saws (25 percent). Amazon lists SawStop tables for $4,600 and up.
"Though often seen as an Amazon-proof industry, the old-fashioned American hardware store is not untouchable," explains One Click Retail's VP Nathan Rigby. "Amazon has all the same advantages in the Tools & Home Improvement sector that it has in Grocery, Beauty Products and Health Care — and we've seen plenty of evidence of those industries feeling the Amazon Effect. As more uber-connected millennials enter home ownership, Amazon's share of this product group, like many others, will continue to grow at a disruptive rate."
"Much of this growth can be credited to millennials, who spend more than twice as much on housewares online versus other demographics" says One Click Retail's CEO Spencer Millerberg. "They are not only digital natives, but they're eCommerce natives. As this demographic becomes a larger portion of homeownership, traditional brick-and-mortar retailers who do not embrace an online strategy will see sales dwindle. Similarly, if brand manufacturers think they can employ a brick-and-mortar retail strategy without considering both the researching and purchasing habits of today's eCommerce consumer (and the distinctive features of the Amazon platform), they will ultimately lose."
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