This report discusses the growth trajectory for home and garden, both short-term and looking further ahead, with analysis of which products have been performing especially well or especially poorly in the context of the wider market, and in the context of other industries competing for essential and discretionary household spending. It considers category, brand and channel performance, mapping the winners and losers, and sharing where the next opportunities (and threats) are coming from.
This report comes in PPT.
2023 was a challenging year in home and garden, with sales declining by 4% at constant 2023 prices, to USD1,239 billion. Housing markets across large parts of the world stalled amidst high interest rates, whilst other sectors which had previously seen suppressed demand bounced back in 2023, at the expense of in-home spending.
Even within parts of home and garden that struggled with decline, there were wellness trends like biophilic design, healthy eating and raising light levels in the home that either provided low levels of real growth (decorative paint, seeds, pots and planters) or at least mitigated a decline, with the performance being better than the surrounding context (cookware and food storage).
IKEA owning 77% of the franchise store footprint, with a 3-month price change tempo across the portfolio, meant that the company successfully navigated the inflationary upwards curve followed by a deflationary savings curve, as input costs fell. Lacking a legacy margin issue, IKEA dropped prices on tactically useful items in demand, gaining substantial share over 2021-2023.
India, Indonesia and Brazil attract attention in recent export and expansion plans, as spending is forecast to grow. In developed markets, retailers focus on marketplace expansion and adding new revenue streams via retail media, while brands focus on under-exploited segments, exploring the wellness trend as a strong prospect for both growth and premium differentiation.
The desire to invite nature into homes in smaller urban settings offers the clearest opportunity area in the market. This is about vertical gardening, self-watering pots, balcony designs and a significant rise in green gifting. With grow-your-own food plants and air quality gains, consumers can literally gift wellness to friends and family.
This project has a strict focus on sales to consumers only. Trade and professional sales are excluded. Home and garden refers to gardening, home improvement, homewares and home furnishings.
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