As home and DIY retailer Kingfisher reports its revenues were up 61.9% to £4.4 billion, we highlight how the changing consumer focus towards home improvements has contributed to the company’s success over the past year.
Kingfisher’s brands include B&Q, Screwfix, and French retailers Castorama and Brico Depot.
Source: Kingfisher
COVID-19 gave a boost to the home improvement market
What a difference a year makes… This time last year, Kingfisher’s sales had fallen sharply across home retail, as consumers withheld near-all non-essential spending and the vast majority of stores had been closed for at least the previous month. Since then, however, home improvement has proved to be among the best performing markets across retail, as it was elevated by extended periods inside and the rise in flexible living demands.
In fact, since their stores reopened after the first lockdown in May 2020, Kingfisher and leading DIY specialists have not looked back – with double-figure sales growth across the market. These retailers have also helped drive much of the shift to ecommerce, as many, particularly beginners, continue to look to their expertise when purchasing online.
Given this shift in consumer behaviours, Kingfisher’s launch of Screwfix as an online-only retailer in France is intriguing. This opportunity has been outlined by the huge success of Amazon, which has grown into a major DIY destination across Europe in the past year; but also, ManoMano, which has shown the demand for specialists in the online sphere.
The DIY trend is for the long term
These changes over the past year will undoubtedly have longer-lasting implications. Among specialists such as Kingfisher, growth has also been driven by the newfound confidence for Do-It-Yourself, which has partially reversed the rising trend for Do-It-For-Me (paying someone else for the service), as seen over the past decade. Accordingly, this landscape has offered a springboard for these big-store DIY specialists to consolidate in the future.
However, they must act now to capitalise on this. Perhaps foremost, specialists can use this opportunity to boost engagement with traditionally less engaged demographics, such as younger and female consumers. Equally, given the unprecedented growth in ecommerce, these specialists must better leverage their store networks to extend their USPs to consumers purchasing online. In fact, this extension of the in-store experience online and building of a more complete multi-channel shopping experience will be crucial to their future prosperity, particularly in the fightback against non-specialists and pure players.
What we think
In the coming years, Mintel expects specialists such as Kingfisher to continue to grow; however, this will stabilise as restrictions ease further and other non-essential sectors, such as travel, entertainment and clothing, return fully to the table. This forecast will be buoyed by the windfall of bigger home improvement projects, such as kitchens, extensions and gardens, which are set to recover after a lulled year. Look out for more discussion on the British and European DIY market in our upcoming DIY Retailing – UK, May 2021 and DIY Retailing – Europe, May 2021 reports.
