The plan, called Private Label, would have seen Houzz developing its own line, sold in competition with the brands already on the massive home platform. The incentives are clear: The company would have commanded a significant margin on its own product, while benefiting from the immense trove of data it has collected from its 40 million users since its founding in 2008. In short, Houzz knows what sells. If the company could make those items itself, the potential profit would be huge.
Indeed, developing an in-house brand is a frequent play for digital retailers in the home world. E-design platforms Modsy and Havenly both have crafted their own lines. Food52 has a house brand. On a larger scale, Amazon has more than 100 house brands.
TechCrunch attributed the cancellation of the plan to the spread of COVID-19. A representative from Houzz tells BOH that the two were unrelated, and that the Private Label program was in its very early stages of consideration.
“At Houzz, we continually review our strategic investments, such as Private Label, to ensure that they are aligned to the current needs of our business and optimized for our continued growth,” Houzz told TechCrunch. “As a result of this process, we have made the difficult decision to discontinue our investment in Private Label at this time.”
Homepage image: A Houzz pop-up in London | Katya De Grunewald