When grocery giant Sainsbury’s snapped-up Habitat and Argos from Home Retail Group, the homewares brand’s future was thrown into doubt.

But, today, further light was shed on Habitat’s role. 

In addition to the seven mini Habitats already trading in Sainsbury’s big sheds, the grocer has unveiled plans to install a further 10 Habitat shop-in-shops during its current financial year.

Despite being wedded to Sainsbury’s with shop-in-shops, Habitat will also continue to have a life of its own.

Moving house

Habitat, which was hugely popular in the 1960s and had standalone stores around the country, has been moved from pillar to post in recent years.

In 2011, the brand and the majority of its shops were put into administration and sold off by then-owner Hilco.

Home Retail Group acquired the brand name and, as part of the deal, picked up Habitat’s three London flagships.

Habitat – in concession form – then sat comfortably alongside Laura Ashley and Argos within Homebase stores, until Homebase was sold to Wesfarmers last year and the remainder of Home Retail was taken over by Sainsbury’s.

Habitat was, once again, without a permanent home. But there’s life in the much-loved brand yet.

Last year, Sainsbury’s committed to open at least six Habitat shop-in-shops, setting the ball roll rolling with a 2,000 sq ft concession store in Nine Elms, London.

Mini Habitat in Sainsbury's Nine Elms

Mini Habitat in Sainsbury’s Nine Elms

But Habitat’s foray back into bricks-and-mortar stores looks set to accelerate in isolation from its new grocery owner.

Habitat has returned to Leeds – where it used to have a store – with a new mini standalone unit measuring (like its store-in-stores) 2,000 sq ft.

And it has ambitions to test further standalone stores in various locations across the UK. But will it work?

A fresh lick of paint

The planned mini stores, which will hold an edited range of 6,000 products, are designed to act as touchpoints to bolster Habitat’s online and offline brand awareness.

According to Verdict Retail’s associate analyst Fiona Paton, this is a sensible move that will win the retailer fresh custom.

“Opening standalone stores reinforces Habitat’s authority in the homewares market and helps the retailer gain more brand awareness to a new generation of consumers who may not have been aware of the retailer in the last decade.

“It also helps Habitat become more prominent and front of mind to consumers, although being in large Sainsbury’s stores also generates some recognition on the high street and exposes it to a higher footfall,” she says.

Finishing touches

Habitat’s move is in line with the behaviour of other retailers in the home and furniture market, such as Sofa.com, Made.com and Dwell, that have expanded their physical footprint in the belief that customers prefer to touch and feel products before making a big-ticket purchase.

Habitat boss Claire Askem on its future with Sainsbury's

According to Habitat managing director Clare Askem, many of the brand’s online customers in the Leeds area expressed a desire to interact with products before buying them, which the new mini store will allow them to do.

“Consumers are increasingly visiting retail stores to examine products and then make purchases online, and the furniture sector is not immune from these changing shopper habits,” says Retail Week Prospect analyst Duygu Hardman.

Paton goes further, saying that seeing and feeling products before ordering is “especially important to consumers purchasing homewares”.

Mini Habitat Nine Elms   7

Inside a Habitat shop-in-shop

However, she points out that Habitat’s “very confined store formats” will restrict how many products it will realistically be able to showcase.

“It is therefore crucial that the in-store experience really focuses on encouraging people to shop the full range online,” Paton argues.

Made.com has been successful in this, Hardman notes. The furniture retailer uses its stores as attractive showrooms where staff focus on helping customers find the items they like rather than stock holding.

It has grown rapidly in the UK as a result.

“I therefore believe this move can only be a positive one, helping Habitat reinvigorate its brand and boost its multichannel sales,” Hardman says.

For now, the homewares business is at least confident about returning to Leeds, where it claims to have a lot of fans.

Treating the first standalone store as a trial, Habitat may have a few finishing touches to make before it spreads out into further locations.

Article first published January 27, 2017.