Home. It conjures up verses of holiday jingles, Norman Rockwell paintings and the aroma of backyard barbecues. And, of course, there's the sweet electronic beep of a cash register, too. Thanks to the lowest mortgage rates in 40 years and the ensuing boom in home construction and refinancings, stores that sell couches, entertainment centers and bedroom sets are experiencing the kind of growth that other retailers can only envy. According to the Commerce Dept., the furniture and home furnishing category grew 7.6 percent in September, 5.7 percent in October and 6.1 percent in November — compared to overall consumer spending growth of approximately 3 percent in 2002. Furniture alone is a $65 billion business.
But getting the attention of customers who may only redecorate their homes once a decade makes furniture merchandising a high-stakes game. “It's a very infrequently purchased product,” says Geoff Wissman, vice president of Retail Forward. “You're talking about a lot of customer turnover.”
How, then, can you increase the odds of getting the business when it's available? By having a gimmick — a special environment, unique merchandising or some other trick to make those infrequent customers frequent your store.
At opposite ends of the continent, Jordan's Furniture in Avon, Mass. and San Francisco-based Design Within Reach (DWR) have faced that question head-on and come up with a common solution: They refuse to take a cookie-cutter approach to retailing, making every store in their chains different and appealing. Each is unique in design and reverberates with attitude — wildly different attitudes, mind you, but each eschews the boring box.
In order for their retail environments to stand out, both Jordan's and DWR typically choose freestanding locations because malls offer neither distinctive spaces nor, in the case of Jordan's, large footprints.
Even department stores that operate in the home furnishings category have grasped the need to differentiate. In February, for example, Bloomingdale's planned to open a 140,000-square-foot home furnishings store in an 80-year-old Chicago landmark — the Shriners temple, an architectural gem that features intricate mosaics and stained-glass windows.
Like Jordan's and DWR, Bloomingdale's has decided, you've gotta have a gimmick. Chicago shoppers will be treated to caviar and blinis in a test kitchen under a starlit dome at the temple. Jordan's has an IMAX theater and DWR creates gallery-like studios in architecturally distinctive spaces to show off its Modernist wares.
Jordan's: A Fun Family Capitalizes on Family Fun Jordan's, founded by Samuel Tatelman in 1928, stands out from other New England furniture showrooms by offering fun over function in a bid to attract suburban families. At its Natick, Mass., store, visitors come for the IMAX theater, one of only two in the Boston area, and to walk down a replica of New Orleans' Bourbon Street, complete with a “Streetcar Named Dessert” snack cart.
The strategy seems to be working. Famed investor Warren Buffett's Berkshire Hathaway found Jordan's prospects so promising that it acquired the $300 million company in October 1999.
The Tatelman grandsons, Barry and Eliot, stayed on as CEO and president, respectively, and still run the company. Their zany imprint is everywhere. Eliot Tatelman's office, for example, is a widow's walk on the faux Bourbon Street from which he waves to customers.
Their long-running television campaign continues to spoof Sprint, Gap, Volkswagen and other commercials, too. “Although we're two crazy guys,” says Eliot Tatelman, “it's become known as a very clever campaign.”
There is a method to the madness. “If you go back to the ‘30s and ‘40s,” says Jerry Epperson, managing director of Richmond, Va.-based consulting firm Mann, Armistead & Epperson, “the business was different, in that stores used to carry a lot of durables — vacuums, appliances, radios. So, the consumer had a reason to go into the store other than to look at furniture. And because those items are more high-maintenance than furniture, you had a relationship with the store.” Over time, appliance and electronics specialty stores took over those categories, making repeat furniture business hard to find.
Today, consumers have to go into a store specifically searching for furniture. And very few people wake up one morning saying, ‘I've got to have a dining set today,' Epperson points out. The Tatelmans recognized that as early as 1987, when they opened Jordan's Avon, Mass., location, the company's third. The 85,000-square-foot store includes a Motion Odyssey Movie Ride, which was one of the first motion simulation rides in the country.
Jordan's Natick store, which opened in 1998 with its Bourbon Street attraction, got its IMAX last October. Families now bring the kids to the 262-seat theater for 3-D movies and they stay to shop, says Eliot Tatelman. He estimates that it has boosted business by 20 percent.
Jordan's entertainment component attracts people to the store who wouldn't otherwise hit a furniture showroom. And, they either make purchases then on impulse, or remember Jordan's when it does come time to buy a sofa. Also, Epperson says, it distracts the family members who aren't making the decisions: “Almost every department has some touch of humor, and of course they entertain the kids, and you can get ice cream,” he says. “You go there and enjoy the day while your wife is upstairs shopping.”
Eliot Tatelman points out that the sense of fun in the store design backs up the brand he and his brother first created in Jordan's television ads: “You've got to stand behind your image, and make sure that's what your image is when people come in and they're not disappointed in what they see and the product.”
The future? Jordan's Furniture is opening a 160,000-square-foot store in Reading, Mass. in 2004, designed by Carter & Burgess. But despite the huge footprints of its stores, Jordan's wants the chain to remain small enough to make sure each outlet is unique. “It's not necessarily what Warren wants,” Tatelman says, “but that's not what's really in the cards for us. Barry and I are both trying to be the best, not the biggest.”
Very Cool, But Very Comfortable
Where humor and family fun draw shoppers to Jordan's, Design Within Reach is selling a very different experience — a peek at what it's like to live with sleek, Modernist-inspired furniture. Recognizing that Modernist furniture and contemporary design appeal only to a self-selected group of consumers, Rob Forbes founded DWR in 1999 as a catalog operation. “We do know that about 15 percent of the population are modern design enthusiasts — that's our market, that's what we're after, and we're not necessarily out to convert all those people who aren't,” says Mary O'Connor, DWR's vice president of sales. Although the company now mails to 1 million households, O'Connor explains that not every reader is comfortable with purchasing furniture sight unseen. So now, the company has gone into bricks and mortar, opening “studios” that allow people to test-drive the product.
But it's more than sample rooms in a big box. DWR's furniture is displayed in art studio-like settings in architecturally distinctive buildings including former warehouses and banks. Take, for example, the 1972 Ray Kappe-designed Beverly Hills bank building where the former teller counter is now a catwalk for furniture, and the vault is a red-carpeted showplace for such design classics as Mies van der Rohe's Barcelona chairs. Or its 5,000-square-foot Fashion Island Mall location, which includes outdoor space and exposed ceiling mechanicals more appropriate to a penthouse loft than a mall interior.
Michael Bodziner, a vice president of architecture firm Gensler who designed DWR's Bay area stores, likens the spaces to “interactive galleries.” Shoppers like the stores' clean lines, but aren't intimidated by a ‘do not touch the artwork’ type of atmosphere. They aren't pressured by a hard sell, either: The studios hold no inventory, so consumers can order furniture on Internet kiosks inside the store, or after their visit.
DWR began opening its studios on the west coast in communities with big clusters of its catalog readers. Of the eight studios already open, the San Francisco Bay area includes three stores and the Los Angeles region four. The eighth store, in downtown Portland, draws Modernism fans from as far north as Seattle, the company says.
DWR founder Rob Forbes, a professional designer himself as well as a Stanford MBA who did stints at Smith & Hawken and Williams-Sonoma, says that sales jumped 37.5 percent in 2002 to $55 million from $40 million in 2001. Although it is difficult to calculate just how much of that growth is attributable to the no-sales stores, the showrooms have been so successful that the chain is beginning a cross-country rollout. In February, DWR was set to open a studio in a once-derelict office space in Dallas, redesigned by Albert Rivera, principal of DAX Studio. And it is laying plans for an East Coast initiative.