April 10th marks National Siblings Day and many families celebrate the relationships they share with brothers and sisters. As decades pass and new generations of family members emerge, how we view and define what a family has changed as well. For example, new, rising middle class in developing economies embrace modern, urban lifestyles. Additionally, technology is connecting homes to retailing ecosystems and fewer residents per household are reshaping the way homeowners utilise their space.
This post highlights some of the key trends and themes shaping households in 2018
Facilities expansion generates an audience for home goods and appliances
A major focus on infrastructural development by emerging markets is enhancing household connectivity to facilities like electricity and water in these countries. This is a major driver of growing appliances uptake in the developing world, in particular appliances for bathrooms (showers, sinks, taps and so on) and kitchens (refrigerators, microwaves, washing machines, cookers, etc.).
Millennials shaping rentals and retro demand
Unlike their parents, millennials are much more flexible in how they view property. By delaying traditional life milestones that precede homeownership, such as education, marriage and kids, millennials are renting longer. They are happy to rent well into their late thirties or live with their family until they have the resources to comfortably live by themselves (part of the “boomerang kids” trend). In Western Europe, a market where millennials represent a major segment of the consumer pie, the number of rented households has increased 2.0 million over 2011 – 2016.
Yet, while many see rent as a way of putting off the major outlay needed to buy a home, millennials are quite happy to be less cost-conscious when it comes to functional and trendy household goods for their rental space. Boutique bins, mirrors and chairs are items that can be significant expenditure points, while millennials are willing to pay a premium for space-friendly goods like foldable bicycles.
Millennials have had a considerable influence on bringing back retro durables into the mainstream. A mixture of nostalgia, curiosity and fashion has led to a resurgence in retro-cool electronics. Consumer electronics firm Nintendo was able to tap into this by releasing retro video game console Nintendo Classic Edition. In 2017, Sony began selling a portable CD radio-cassette player, while Hitachi Maxell replicated the design of one of its throwback cassettes popular in the 1970s. Brands that are able to play on this sentimentality can significantly enhance their status among millennial consumers.
Access to home financing enables more homeowners
The world is currently undergoing what may only be described as “mortgage mania”, as decreasing interest rates and better regulated financial systems are enabling more home-seekers to leverage home finance services to purchase a home successfully. On the one hand, standards of living have been rising as homeowners are feeling an increased sense of security as compared to those who rent. On the other, a segment of the population is developing that have long-term indebted homes which could feel the pressure if a market experiences a sharp economic downturn.
The future of homes will increase in both size and connectivity as more households are able to afford smart devices, driving home demand for greater digital features. Companies looking to capitalise on households must embrace these global shifts and find new ways to reach and appeal to these changing consumer preferences.
To learn more about key trends in homes and households, download our white paper “2018 Global Overview of Homes”.