Tuesday, November 10, 2009

Floor Covering Trends Target Generation Y

Stuart HirschhornThe following is based upon Catalina Research's statistical trends and outlook for floor covering which indicate that Generation Y is floor covering's next target.

If your business is to survive the current recession and thrive during the next economic recovery, it's time to set your sites on the Generation Y - those born between 1974 and 1993. Catalina's research shows that as we entered the recession in 2007, it was the younger demographic that was increasing its floor covering spending while their Baby Boomer parents were cutting back on floor covering purchases.

These trends reflect what is considered the lifecycle of purchases. The Baby Boomers (ages 45 to 64 years), numbering 38.0 million strong in 2008, have cut their floor covering spending as their concern about saving for retirement increases or they retire. On the other hand, the 42.7 million members of Generation Y are focusing on forming households, starting families, and purchasing homes and home furnishings. It is Generation Y that is taking advantage of the first time home tax credit and putting a floor under the prices of homes in the lower end of the housing market.

Despite their greater numbers, Generation Y represented only 16.9% of total U.S. household floor covering spending, while Baby Boomers accounted for 40.1%. However, the Boomer’s share is declining, while Generation Y’s share is on the rise. This trend will accelerate over the next decade as the leading edge of Generation Y enters their peak floor covering purchasing years (35 to 44 years) and Boomers begin to enter a period of their lifestyle when household floor covering purchases decline sharply.

The changing of the generations could also contribute to a continuing shift to hard surface flooring. In 2007, Generation Y was more likely to purchase hard surface flooring and area rugs, while Baby Boomers and older generations are more likely to purchase wall-to-wall carpet. This trend indicates that the flooring market could increase its dependence on wood and laminate flooring, vinyl sheet and floor tile, and ceramic tile over the next decade. Currently however, Generation Y may prefer the lower-end lines of these markets, since their incomes are probably lower than their older cohorts.

Generation Y will impact where and how floor covering is sold. This is the first generation to be highly dependent on the Internet as a medium, just as their Baby Boomer parents were the first to experience the impact of television. Generation Y looks to the Internet to retrieve product information, get opinions from social networks, and use electronic connections to communicate with suppliers and make purchases. Manufacturers, distributors, retailers, and installers must utilize the online medium to reach Generation Y as they increase their share of household floor covering purchases. The successful players in the floor covering market will be able to take advantage of these trends and meet the needs of the growing Generation Y, the younger demographic.

If you have a question or observation about Generation Y shoppers buying floor covering please comment here. I'd love to discuss it!

2 comments:

  1. You hit it on the head with that . I would say that 90% of my Y gen customers us the internet and social media to gather info and decide who they'll visit for floor covering. I am a 3rd gen family floor coving owner and am doing many different things than my dad and grandfather did. We have had a website for years now but have added a blog and Facebook to reach the younger buyers. Only by using all the tools you can, will you be able to compete and win with the "big boxes".

    Troy Aeby
    Duralum Carpets Inc.
    Stevens Point, WI.

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  2. Troy, thank you for your comment on Gen Y flooring purchases. I should have added one more observation on the blog- The winners selling Gen Yer's will probably be Gen Yer's themselves, since they are most comfortable with digital media.

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