08282016 Let's Talk Cross-Category: Rug Vendors Selling it All

LAS VEGAS -- Although cross-category began as a gradual evolution with a few rug-focused early adopters, showrooms at 2016's summer markets proved the concept is now revolutionizing the collective DNA of the home furnishings industry.

In an effort to grab more and more of their retail customers' open to buy, rug companies continue to expand their product mixes beyond rugs. On the flip side, case goods, upholstery and soft goods brands are getting into the rug category. 

What's more, some brands known to younger retailer store buyers as total home suppliers actually got their start in the rug business. Some, including Abbyson Living and Classic Home, are reasserting their commitment to the rug category in 2016 with deeper and broader assortments. 

In this exclusive two-part report, RugNews.com asked a sampling of major rug suppliers to talk about their differentiated product lines, rationale for branching out into multiple categories, product trends and what's next on the horizon.

WHY EXPAND?

Whether chosen first as the centerpiece in a room or last to add the final touch, rugs are basic to decorating a home. Rug suppliers have become experts at forecasting trends in color, texture and design, so it is only natural that more and more rug manufacturers are expanding by taking all that home fashion expertise into other product categories.

In addition to its wide and deep rug line, Nourison offers broadloom carpet and home accents including an array of pillows and throws as well as a growing line of table runners and squares, according to Alex Peykar, company principal. "We felt they were logical extensions of our business and we had the right expertise to be successful in these categories," Peykar noted.

For others it's the potential of cross merchandising that beckons. Momeni offers a line of accent furniture and decorative accessories under the M2 Momeni Home brand by Momeni, said Reza Momeni, company president and CEO. 

"We have seen a shift in the home furnishing industry where cross merchandising has become important--mixing furniture with rugs and vice versa," Momeni noted. "We have seen that the stores that offer a mix of home furnishing products including rugs draw more traffic, and offering more items can add more revenue. I think rug retailers should look into it seriously," he advised.

Consumers, from entry level to high end, are looking for convenient ways to express their own style in their homes. For retailers, being able to show a full assortment of accessories on the retail floor encourages consumer engagement and increases revenue potential at the time of the upholstery (furniture) purchase, Surya's Tiwari explained. "It also ups the likelihood of repeat business. So, expanding into additional categories makes good business sense on a lot of levels," he noted. 

Safavieh is committed to building a brand as well as a catalog of products, with an in-house team that is always looking for opportunities to keep the company's name top-of-mind with its consumers, explained Jonathan Yaraghi, creative director of home for the company. Safavieh offers an extensive menu of home items: lighting, decorative accessories, furniture and mattresses as well as outdoor products including furniture, concrete and ceramic pieces and a broad array of indoor and outdoor rugs, Yaraghi noted, adding, "We were one of the first to start with pillows and have continued to expand where there is opportunity."

Connecting with potential consumers online is proving to be an effective strategy. "Safavieh has more than 300,000 Instagram followers and gets feedback from our customers about design and products. Then our social media team works with the product team to provide in sync and fast responses. We are also tied to our partner dealers, who make recommendations about other categories."

With its award-winning rugs as a foundation, the Jaipur Living brand has evolved in the last decade as a lifestyle solution for its customers, according to Asha Chaudhary, president of Jaipur Living. "We've introduced curated collections in key textile categories that currently consist of pillows, poufs, stools and throws," as well as rugs, Chaudhary said. As each category gained growth and acceptance, that momentum made expansion into the next a natural step, Chaudhary explained, adding, "We've set the stage to elevate both the quality and the assortment of our products."

MORE IS MORE

A broader menu provides more opportunities for manufacturers, retailers and consumers, Nourison's Peykar noted. "Consumers can visualize how they want to decorate their room, and the more they can purchase at once, the better. It allows rug manufacturers to sell more of the whole look--not just the rug--and really tailor to the consumer's needs," he explained.

For manufacturers, "Multiple categories allow us to grow our business and work with new customers who also have an interest in home accents or broadloom. It also allows us to have more products available at different price points, and offer home accents in leather, natural hide and genuine fur," Peykar stated. He added, "Our rugs and home accents are designed to complement each other, in regards to design, color and texture."

Loloi's expanded line has been well received. "We approached it with our traditional dedication to make something unique. There are more than 600 pillow styles and 15 collections of throws, each with two to six styles. Furniture stores and big box retailers are the best channels for us, as well as online dealers," Loloi said. 

Both new and established retail accounts are attracted to Loloi's new categories. "If it's a new customer for us, they might start with interest in the pillows, but they will also come to us for rugs. If they are already getting rugs from us, it's a natural to look at the pillows and throws," he noted. And, the different products help one another. "We haven't designed the pillows and throws to coordinate with any specific rugs, but they can complement each other," Loloi said. 

Chaudhary reported, "The new product lines add dimension to Jaipur's portfolio, allowing the company to offer its customers a more complete solution for the home furnishings business."

Yaraghi stressed, "Almost all of our dealers have a wide variety of Safavieh products, because the items are directly tied to the end consumer and what she wants. A lot of our end consumers furnish entire rooms and even whole homes with products from all of our categories. When the consumer is satisfied, they come back to the brand."

Editor's Note: For insights on trends and what's next in cross-category from these industry thought leaders, look for Part 2 of this RugNews.com special report, LET'S TALK CROSS-CATEGORY.