The home needs industry has grown actively only in recent years and holds a lot of scope for growth globally and e-commerce is making its growth even more bolder. Currently, this niche sector is prominent in limited regions but is rapidly growing to newer ecosystems.
The home needs sub-sector can be described as a combination of the multi-products and agriculture industry. A report by HexGn that studied the funding trends in the e-commerce industry and its various sub-sectors states that there has been a 15.24% growth in the home needs sub-sector in the last five years. The goods sold includes all kinds of home essentials from grocery to storage solutions to toiletries to packaged food. A shift to a lifestyle in which the priority is for leisure activities is overtime spent on shopping for home, has helped in boosting the sales for home needs e-commerce.
According to a report by HexGn, between 2014 and 2018, the number of deals fell considerably towards the end of this period, but the amount of funding received grew well. The total investments in the home needs sector by the end of this duration was more than $2 billion.
Dollar Shave Club
The Dollar Shave Club is a subscription-based service for men that delivers all the paraphernalia required for shaving. The company was founded by Michael Dubin and Mark Levine in 2011 and went to become a subsidiary organization of Unilever in 2016. The Dollar Shave Club does not just aim to offer the convenience of skipping the lines at a retail store but also has designed the subscription boxes to help its customers enjoy high-quality products at fantastic prices. It is headquartered in Greater Los Angeles and has over half a million members on its platform.
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Indian on-demand food delivery startup FAASOS is among the pioneer startups in the India sub-continent that has upped the food delivery game. It has changed the way people order food and currently offers its services in 15 cities across India. The company offers its services through its app and is growing at a steady rate with good growth in the number of downloads. FAASOS was co-founded by Kallol Banerjee and Jaydeep Barman in 2011 and has secured $103.7 million in funding from prominent VC firms. Backed by the likes of Sequoia and Alteria Capital, the startup aims to become a leader in the on-demand food delivery segment.
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California based Grove Collaborative is a home needs e-commerce platform that was co-founded by Chris Clark, Jordan Savage, and Stuart Landesberg in 2016. The product offering of the company includes household items,? personal care goods, and items for baby & kids. Grove Collaborative boasts of only providing eco-friendly and all natural products that are not harmful to the earth or the buyer. It is a subscription based service which allows its customers to personalise what will be included in their cart each month or for the time interval they choose for the products to be delivered. Grove Collaborative has collected $165.8 million in funding till date.
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BigBasket is an online food and grocery store that has shown immense growth since its inception. It is among the pioneer online food and grocery store startups in India and was co-founded by Abhinay Choudhary, Hari Menon,? Vipul Parekh, and VS Sudhakar in 2011. The e-commerce platform has a wide range of products that are delivered to the customer’s doorstep according to their preferred time slot. The company has also piqued the interest of several investors and has raised $885.7 million so far. BigBasket acquired four similar companies in recent years as well. Currently, the online food and grocery store offers its services in over 30 locations in India and is based in Bengaluru, a prominent startup hub in India.
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Fernish is a subscription-based service for home essentials. The platform offers affordable home furnishings that you can subscribe for any desired period according to the needs. The platform aims to make moving to a new home easier and also help reduce the number of furniture thrown out. With Fernish its customers can get furnishings that blend with their temporary home and replace them without any hassles when they move into a more permanent space. Fernish was co-founded by Lucas Dickey and Michael Barlow in 2017 and is based in Los Angeles. It has completed three rounds of funding since its inception raising $30 million from them.
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London based Made.com is a growing e-commerce portal for designer furniture. The startup does away with any middlemen and helps designers reach their end customers directly giving them a larger customer base. It is a win-win situation for all the stakeholders including the customers who get to buy high-end furniture for lower prices. Made.com was established in 2010 by Julien Callede, Ning Li, Chloe Macintosh, and Brent Hoberman. The platform now offers its products in most parts of Europe including Austria, Belgium, Switzerland, Germany, and France.
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India -a Leader in the Home Needs Sector within E-Commerce
Home needs as an independent sub-sector is still one of the newest ones in the e-commerce arena. Thanks to giants like Shopify and Amazon, shopping online has become a common habit that has also opened up new shopping avenues for the customers and newer channels for sellers to capture a diverse market that is virtually free of any boundaries.
India has taken the lead in the region with a large home needs e-commerce sector and has also attracted a sizeable amount of investments. The only country that may offer competition in the home needs segment to India currently would be the USA. These two countries received the highest funding in 2018 for the respective home needs industries with India taking the lead with $60 million.
Within the global home needs industry, furniture and electronics are the most popular category of items as per a report from shopifyplus. The revenue from furniture and electronics e-commerce amounted to $258 billion in 2018 and is expected to $394 billion in the next five years.
Upcoming Trends in the Home Needs E-commerce Industry
Home needs e-commerce has picked up a lot of momentum in the last five years. There are several new e-commerce startups on the rise that cater to home needs. Here are some of the upcoming trends in the e-commerce sector for home needs platforms.
An increase in the number of furniture subscription e-commerce platforms will be on the rise. There has been a notable decrease in the number of people who can afford houses, furniture subscription services segment will be able to leverage this by offering affordable temporary furniture for rental homes.
Grocery subscription services from e-commerce platforms will also tend to become more popular in the coming years.
The home needs e-commerce segment is growing and its performance in the next five years will be critical to help it establish itself in newer regions globally. Higher funding, more modern technology and higher internet penetration will be essential for the same.
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