Online furniture and home furnishings seller Wayfair is set to open its first-ever namesake store next month, the company announced Thursday.
The large-format store, clocking in at 150,000 square feet and located in Edens Plaza in Wilmette, Illinois, will open to shoppers on May 23. It will also feature an onsite restaurant called “The Porch,” the company said, taking a page out of Ikea’s store setup.
Although this will be the first brick-and-mortar location for the Wayfair brand, the company has tinkered with opening test stores for some of its other owned brands, including Joss & Main and AllModern.
But the move to expand its flagship Wayfair brands into physical stores comes as it struggles with sluggish sales and an increased need for spending on advertising.
“Wayfair’s online business has been tremendously successful at generating sales. Unfortunately, it is not profitable because of the amount of marketing that has to be done to attract and retain customers,” said Neil Saunders, retail industry analyst and managing director at GlobalData Retail.
Furniture stores need to always be advertising, Saunders added, because people generally don’t buy furniture very often. Wayfair constantly needs to remind customers that it even exists, as a result.
But it’s not just the big advertising spend that’s hobbling the company. Sales are down, too.
Wayfair posted a 1.8% drop in its annual sales in 2023, to $12 billion, and a net loss for the year. In January, the retailer laid off 1,650 workers, or 13% of its global workforce. This follows a separate round of layoffs in 2023 that eliminated 1,750 jobs.
Saunders said the new store could help drive sales and give Wayfair a more visible presence in the market that will “throw a halo around the online operation.”
“It’s basically a recognition by Wayfair that people shop in an omnichannel way, and like to visit stores as well as use online. This is particularly important in furniture and finishings where people like to see and try out products before buying,” Saunders said.
Whether the store makes a difference to Wayfair’s financials remains to be seen. “If this store is successful then it could be the start of wider physical expansion for Wayfair,” Saunders said.
Quiet luxury vs. loud budgeting: The best splurge and save home goods of 2024
Splurge on Quiet Luxury: Gwyneth Ivory Boucle Swivel Chair by Goop
Save With Loud Budgeting: Arijit Boucle Upholstered Swivel Armchair by Wade Logan
Splurge on Quiet Luxury: Aesop Aromatique Hand Wash
Save With Loud Budgeting: Muse Bath Apothecary Hand Ritual Soap
Splurge on Quiet Luxury: Restoration Hardware Reed Floor Lamp
Save With Loud Budgeting: Project 62 Ellis Tripod Floor Lamp
Splurge on Quiet Luxury: CB2 Mardones Camel Brown Velvet Sofa
Save With Loud Budgeting: Bed Bath & Beyond Kaiya Performance Velvet Sofa
Save With Loud Budgeting: Aire Candle Co. Santal and Cardamom Candle
Splurge on Quiet Luxury: Le Labo Santal 26 Candle
CNN’s Jordan Valinsky and Samantha Delouya contributed to this story.
Online furniture seller Wayfair is launching its first brick-and-mortar store, clocking in at 150,000 square feet with an onsite restaurant that borrows from Ikea’s setup.
The move to expand its flagship Wayfair brands into physical stores comes as it struggles with sluggish sales and an increased need forspending on advertising.
Although this will be the first brick-and-mortar location for the Wayfair brand, the company has tinkered with opening test stores for some of its other owned brands, including Joss & Main and AllModern.