The Gardening and Residence Enchancment sector tracked by GfK is experiencing a interval of development stabilization in 2024. 4 years on from the primary wave of the COVID-19 pandemic, the place individuals spent considerably extra time at house, customers’ priorities have shifted, and financial indicators are bettering. Coupled with some key traits which can be shaping the market, this offers the panorama for development over the approaching 12 months.
Shoppers’ reallocation of time and spending
As customers work and research from house greater than up to now, the house and backyard have turn into a spot of retreat and identification. Nonetheless, spend on out-of-home actions is on the rise and, as inflation begins to subside, holidays are shifting up the precedence checklist. Globally practically one in 5 customers plan to spend extra on holidays overseas this 12 months, in response to NielsenIQ’s Client Outlook 2024 research.
Spending money and time on the house continues to be vital to individuals, however not on the frequency it was just a few years in the past. In 2021, on the top of the COVID-19 pandemic, 36% of individuals mentioned they hung out each week on house upkeep or enchancment. At present that determine has dropped to 33%, with individuals as a substitute shifting to month-to-month upkeep (up from 28% in 2021 to 31% at present).
Behavioral shifts are additionally occurring within the scale of house enchancment tasks. Throughout lockdowns, huge renovations had been widespread. Over the previous few years, nevertheless, Europe’s housing markets have been impacted by excessive uncooked supplies prices, rising rates of interest and traditionally low ranges of shopper confidence. This, added to the distraction of accelerating out-of-home spending, has meant individuals’s focus has shifted to smaller, quicker house tasks, upgrades, and repairs.
Backyard and residential enchancment income is stabilizing
Excessive inflation in 2022 pushed up costs, and subsequently additionally income, for a lot of Gardening and Residence Enchancment classes, whereas quantity remained in decline. Throughout the first 4 months of 2024, nevertheless, gross sales income stands at +3% vs. the identical interval final 12 months and, much more encouragingly, quantity can be returning to development in 2024.
The classes driving this development are gardening, house care, meals tools and ironmongery (door locks), in addition to scorching water heating. These classes uncovered to longer substitute cycles, and larger tasks — similar to faucets, bathe elements, emulsion paints and LED lighting — are declining once more this 12 months. Nonetheless, sealants, DIY adhesives and energy instruments are experiencing slight development as customers flip to smaller DIY tasks and DIY repairs.
Key class traits inside Gardening and Residence Enchancment
Client demand for comfort stays a key buy driver throughout each the Gardening and the Residence Enchancment sectors.
- In Gardening, income from gross sales of cordless powered gardening instruments is up 23% up to now this 12 months (January to April 2024), in comparison with 12% for the powered gardening instruments class general. And gross sales worth of sensible app-controlled water timers is up 47%, in comparison with -2% for the water timer class general.
- In Residence Enchancment, ready-mixed equalizing plaster noticed income develop 10% in January to April in comparison with final 12 months, whereas different variants solely grew 7%. Voice-controlled LED lighting, in the meantime, held regular at 0% income development, in comparison with the -5% drop seen by non-voice-controlled LED lighting.
The comfort of on-line purchasing is revolutionizing particular segments inside the Gardening and Residence Enchancment market. Between January and April, on-line gross sales throughout the sector grew 16% in comparison with final 12 months, primarily pushed by instruments, machines and workwear.
Environmentally pleasant selections are additionally a noticeable development. Watering/cleansing merchandise and chemical compounds skilled a rise in gross sales of high-priced merchandise in January to April this 12 months, due to customers’ willingness to pay extra for eco-friendly merchandise in these key areas.
Model repute is proving key in classes similar to DIY adhesive tapes and paints, the place customers need to get the job or undertaking carried out proper the primary time. For the beginning of this 12 months, commerce manufacturers have misplaced out to larger finish manufacturers in these classes.
General, the merchandise outperforming throughout Gardening and Residence Enchancment are eco-friendly, handy, simple to make use of and automate duties to save lots of the consumer time.
Fast and long-term outlook
The 12 months forward guarantees to see persevering with alternatives for the Gardening and Residence Enchancment business. Client demand is growing in key areas, with a deal with smaller house enchancment tasks and an ongoing choice for merchandise that present comfort, time financial savings, ease of use and flexibility.
Within the long-term, demand will stay robust, with the main focus more and more shifting to sustainable houses, buildings, gardens, and supplies. That is fueled by customers’ personal core values in addition to EU laws for zero-emission new buildings from 2028, plus new initiatives linked to the EU Inexperienced Deal. This mix of non-public drivers and authorities laws will closely influence the way in which customers buy and devour merchandise, creating alternatives for DIY retailers and types to broaden their choices and portfolios.
