UK homeware retailer Dunelm is poised to further solidify its market position in 2024, as consumer preferences shift away from purely price-driven shopping.
According to a new report by leading data and analytics company GlobalData, Dunelm’s ability to offer a wide range of products at various price points has made it a resilient force in the face of economic challenges.
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GlobalData’s The UK Sector Series: Homewares, 2023-2028 report forecasts that Dunelm’s market share will increase from 11.2% in 2023 to 11.5% in 2024 while discount retailers are expected to experience more modest growth.
“Dunelm is well-positioned to retain and attract shoppers, who will be increasingly focused on design and quality as the year goes on and as consumers start to feel better off, as it has worked to cement its style credentials recently,” said Emily Salter, lead retail analyst at GlobalData.
“This should also help stave off consumers trading back up to upper-mass-market retailers like Next and John Lewis.”
As consumers become more discerning about their homewares choices, the emphasis on value for money is gradually shifting towards quality and design.
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By GlobalDataGlobalData’s 2024 How Britain Shops survey found that 93.1% of consumers now prioritise quality over price when purchasing homewares.
“Although value for money still closely follows quality in terms of importance, this indicates the marginal improvements in how consumers feel about their personal finances since last year, and they are more willing to invest in quality homewares as a result,” added Salter.
However, the growing popularity of the second-hand market presents a challenge for all retailers, including Dunelm.
According to the data and analytics company, 8.6% of UK consumers have purchased second-hand homewares in the past year, compared to 42.8% of consumers who have bought homewares overall.
“Consumers are increasingly aware and accepting of purchasing second-hand from specialist platforms like Vinterior, or marketplaces like Facebook Marketplace and Vinted,” said Salter.
“The most important driver of purchasing second-hand was saving money or to find a bargain, so retailers which promote their value credentials but have reputations for lower product quality will especially come under pressure from the financial benefits of buying second-hand.”
Overall, Dunelm’s ability to adapt to changing consumer preferences and offer a compelling combination of value, quality, and style positions it well for continued success in the UK homewares market.
