Why did it take At Home so long to decide to sell online?
Furniture has been one of the fastest-growing product categories online in recent years. That doesn’t mean it’s profitable, however, which leaves it to retailers competing in the category to deal with the greater costs associated with selling online or skip it altogether. One of those holding out against joining Amazon, IKEA, Raymour & Flanigan, Wayfair and others in the e-tailing race has been At Home. That, however, is about to change.
In an interview with Bloomberg, chairman and CEO Lee Bird said that a precipitous drop in At Home’s stock price in June led him to reconsider pretty much everything about the company’s business.
Among the decisions made was that At Home needed to slow down the pace at which it was opening new stores. Another was that the chain needed to sell online.
Just two years ago, Mr. Bird was feeling good about At Home’s prospects. The chain was looking to basically increase its store count four-fold to around 600 locations and its website, which was heavily trafficked, was simply there to provide information. Customers looking to buy had to make a trip to an At Home store.
Fast forward to 2019 and At Home has been rumored as a takeover target. Reuters reported in May that Kohl’s was in preliminary discussions to acquire At Home. Not long after, At Home’s stock tanked, losing nearly half its value in one day. The company’s share price is down 54 percent for the year.
The chain plans to begin testing buy online, pickup in-store transactions in some markets. If all goes well, it will expand BOPIS to more locations. At Home has set 2022 as the target date to begin offering delivery of online orders to customers’ homes and offices.
Brad Thomas, an analyst at KeyBanc Capital Markets, told Bloomberg that At Home has been hurt by a slowdown in the housing market and a failure to make consumers aware of its point of difference in the furniture category.
“The average American is not aware that At Home is a low-price leader,” Mr. Thomas said.