Wayfair is new to physical retail. The home furnishing giants sold billions of dollars of furniture and home decor in 2024, and with only one physical store, the lions share of that was online.
But physical retail has always been in Wayfair’s plan. And with a handful of stores set to open in the next few years, that plan is in motion right now.
“Our aspiration is to have a physical store for the majority of our customers, which does imply a national footprint,” said Liza Lefkowski, Vice President of Merchandising and Stores.
Lefkowski sat down with Chief Marketer to discuss Wayfair’s future physical retail plans.
To set the table: Wayfair’s inaugural large-format store opened May 2024 just outside of Chicago. It’s working:
- Sales in Illinois are 15% higher than Wayfair’s national average in the past year.
- More than 50% of store customers were new to the Wayfair brand in the past year.
- Sales in lower-ticket impulse purchase categories are 50% higher in Chicago, and sales in high-consideration purchases (such as bathroom renovations and kitchen cabinets) are 35% higher in Chicago vs. comparable markets in the year since the store opened.
“It continues to be very wild to me that there are all these new people that we haven’t been able to engage before now, but the store is such an unlock for that,” Lefkowski said. “It makes sense that there’s this cohort of folks who just really appreciate having a store environment for these types of purchases.”
Wayfair’s Store Expansion Plans
Wayfair plans to open large format stores in Atlanta and Denver in 2026, and New York in 2027.
“We are looking for locations where we have a concentration of customers, so that tends to lead us toward higher density areas, cities, et. cetera,” Lefkowski said. “We’re looking to be in good company with the retailers that surround us. Other than that, it’s about finding real estate that can support a store of our size because we do have large stores.”
Lefkowski said Wayfair is still in the learning phase of how its physical stores will look and the optimal target retail centers. For example, should the store be one floor or two, should it be the anchor tenant or be near other large format stores or other large furniture stores.
Wayfair is not necessarily looking for one best path, but maybe a few ideal routes, and then learning what it should consider with these different factors.
How Pop-Ups guided Wayfair’s Store Strategy
For the past decade, Wayfair has dabbled in opening physical pop-up stores. And what it learned from those is that when Wayfair does establish itself as a physical retailer, it needs a big box.
“In order to bring Wayfair to life in a small space is nearly impossible because so much of the brand is about this incredible selection of home,” Lefkowski said. “All rooms at the house and all things in those rooms, you need a certain amount of space to do that justice. What we learned very quickly in pop-ups is that’s incredibly hard to do. In order for a pop-up to work for a brand like Wayfair, it has to be super targeted and super purposeful.”
Wayfair tested a few concepts, such as a holiday-focused pop-up, that was great for that time of year. But it wasn’t enough for Wayfair to come to life physically.
Currently, Wayfair is not doing pop-ups for its flagship brand.
Making Stores Fun
Once shoppers are in the store, it’s Wayfair’s job to make it fun and engaging, so they not only buy but they also come back.
Because Wayfair sells home items, the retailer aims to make it store homey and a place where consumers would want to hang out. For example, there is natural light, a lot of color, prints, and it has the scent “Perfect Weekend” pumping through the airwaves, which it also sells in a candle.
“When we can have a customer experience the store, it’s like an incredible way to educate them on Wayfair that has halo effect to the entire brand,” she said. “It’s such an opportunity to bring Wayfair to life in terms of not just the breadth and depth of our offer, in terms of what we sell, the services that go with that offering, but for them to experience our brand personality, our desire to help.”
It also has interactive elements, such as running water out of its faucets and shower heads, a pillow toss area where consumer can fluff up the accent pillows, and a cafe where shoppers can purchase food and drinks while sitting and drinking from Wayfair’s own products.
“When a customer is able to come to the store and experience all of that in such an immersive way, it translates to how they shop with us in other channels,” she said. “From a marketing tool perspective, it’s not just about the impressions, but it’s about our ability to really go deep in that moment and bring the brand to life for folks. That’s where a lot of the value is.”
Because of that value, Wayfair aims to bring more shoppers to its stores by reaching out to the local community, such as sponsoring and hosting local organizations and clubs.
Plus, just by having its name in large font on the front of its store creates impressions. Wayfair’s location visible from the highway also generates many impressions to the stream of cars passing by.
Wayfair’s Year-Old Membership Program
Wayfair aspires to be the retailer shoppers go to for all of their home needs. Yet, most shoppers may stick within a certain category and not know that the brand also sells home improvement products or gazebos or grills.
To get its brand more top of mind for its current customers, in October 2024 it launched a membership program for $29 a year. Members receive free shipping for every order, 5% back in rewards on purchases, exclusive deals and other perks.
“Let’s provide extra incentive for other folks to think of Wayfair a bit more often for their home needs,” Lefkowski said.
Shoppers are learning about the program while in store from associates.
“Our associates are engaging with folks explaining the program, and people are responding well to it,” Lefkowski said. “And so we are seeing pickup because of that in a large way.”
Network
