Will homey habits from the pandemic fuel Williams-Sonoma future growth?
Williams-Sonoma Inc., the parent of Williams-Sonoma, Pottery Barn and West Elm, reported that same-store sales grew 25.7 percent in the fourth quarter and 17.0 percent in 2020 with the help of the home cooking craze. Officials expect some old, some emerging and some new trends to drive healthy growth in 2021.
Asked by an analyst on the company’s fourth quarter earnings call which trends emerging during the pandemic would prove “stickiest” post-pandemic, Laura Alber, president and CEO, cited the continued benefit of home cooking discovery, particularly as many Millennials and other younger generations have picked up cooking.
Ms. Alber said, “Once you learn to cook, you never go back. You may go out to dinner, but you’re going to cook better, and you’re always going to be interested in the cooking trend, and that is key to the future of Williams-Sonoma.”
All three of the company’s banners are expected to benefit from a thirst to entertain at home as social distancing measures further ease. Ms. Alber said, “We haven’t been able to entertain, right? I mean Easter, some people might actually be able to get together for Easter. July 4th. Imagine the holidays. We are busy dreaming of the most inspiring Christmas parties, the Hanukkah parties, New Year’s parties that we can host in our homes.”
All three banners have also seen strength in outdoor furniture, and that’s expected to continue. Ms. Alber, “We all got fresh air. Nobody even got the cold or the flu. I think you’re going to stay outdoors a lot more than you did before.”
Finally, the work-at-home trend is expected to support purchases. Said Ms. Alber, “I don’t know about you, but I still haven’t really accomplished the perfect work-from-home station. I still have a desk to buy. You’ve just been so busy. You just don’t get around to it.”
Other factors expected to support growth include the shift on online selling, given its digital-first focus, the expected continued recovery in brick and mortar, the benefit of double-digit growth in 2020 in new customer counts and loyalty members, and catching up on inventory shortages due to current supply-chain bottlenecks.
- Williams-Sonoma, Inc. announces strong fourth quarter and fiscal year 2020 results – Williams-Sonoma, Inc.
- Williams-Sonoma (WSM) Q4 2020 Earnings Call Transcript – The Motley Fool
- Is Sur La Table too late for the home cooking craze? – RetailWire
DISCUSSION QUESTIONS: Do you see Williams-Sonoma’s banners tapping the right trends in 2021 and post-pandemic to continue to drive growth? Which trends cited in the article will likely be most beneficial and which are more questionable?