Home and Retail Intelligence Report
March 2023
Do-It-Yourself Nation: How Inflation is Influencing Home Improvement and Retail Spending
Inflation may turn all of us into followers of Bob Villa, the famous home improvement do-it-yourselfer.
The persistent high cost of goods has everyone thinking about how they can tighten their belts. It turns out that for some, according to the latest JD Power data, that might mean adjusting their tool belts, as they get set to paint their walls or install their cabinets to save some cash.
Tool Time
When asked, at the end of 2022, how consumers in America planned to spend money, 56% said they plan to tackle home improvement projects. While the most common projects were painting (31%) or lawn/landscaping/gardening (18%), some plan to start more ambitious bathroom (14%) and kitchen remodeling projects (12%).
Nearly half (43%) of those who plan to take on a home improvement project say they plan to do the project themselves, while 33% say they plan to have friends/family help them. The remaining 24% say they will hire someone to do the work. That reflects a four-percentage point shift from those that say they completed the last home improvement project themselves (39%) vs. those who hired someone to do their last project (28%).
Curtailed Spending
While many American consumers are forging ahead with their projects in the face of inflation, rising prices have tamped down spending for some. When asked how they feel about being able to make a major purchase ($100 or more), including a home improvement project or receiving the home improvement services they want, 44% of consumers said they feel positively and have no concerns, 41% were neutral and 15% feel negatively and have concerns about that kind of expenditure.
Those with concerns cite inflation/rising cost of products and services as their main worry (29%). Concerns also included rising interest rates (20%), not being able to finish the project due to the high cost of a product they need (20%) and supply chain issues (15%).
Don’t Write Off Retail Just Yet
The death of brick-and-mortar retail stores may be greatly exaggerated. When asked how they will make their purchases, 42% of consumers said they will use a combination of in-store and online for their purchases, while 34% said they will make online purchases only and 24% said they will make in-store purchases only.
Where brick-and-mortar stores really shines, though, is with bigger expenditures. When asked how customers plan to make their larger purchases ($100 or more), a majority (51%) said in-store only. Of those who said they would shop online-only for larger purchases, 21% incorporated some component that requires a retail space, like online ordering with in-store pick-up (15%) and curbside pick-up (6%).
Informed Strategies
While retailers are understandably nervous about what inflation and a possible recession could mean for their businesses in 2023, it’s clear that American ingenuity is still alive and well, as customers are eagerly pursuing ways to make their big projects and purchases possible. That should inform retailers on how they can engage with their customers and avoid some of the volatility that may come with any future financial instability.
Marketing do-it-yourself (DIY) home improvement as attainable and doable, continuing to put on customer demonstration classes for weekend warriors and making sure big box retail stores are still adequately staffed (especially in the customer service/online pick-up locations) are just some of the ways retailers can make sure they’re adequately meeting customer demand. Retailers that can understand those goals and cater to customers should build themselves enough of a buffer between their balance sheet and a shaky economic climate.
Find out More
This Home and Retail Intelligence Report is based on responses from 2,005 consumers nationwide and was fielded in October 2022. It was authored by Christina Cooley, director of home and retail intelligence at JD Power. Please contact us at the numbers below to connect with Ms. Cooley or to learn more about the underlying research.
Media Contacts
Brian Jaklitsch; East Coast; 631-584-2200; [email protected]
Geno Effler, JD Power; West Coast; 714-621-6224; [email protected]