Wayfair may be one of the most successful online retailers of the 21st century, but it took some time to get there. On the latest episode of the The Business of Home Podcast, Wayfair CEO Niraj Shah tells host Dennis Scully that in the company’s early days, he and his co-founder and co-chair, Steve Conine, often had to bury the online part of the business when courting brands to join the platform. “I think Steve and I might permanently hold the record for the [people] thrown out of the most number of showrooms at High Point ever,” Shah says with a laugh.
Given how central e-commerce has been to Wayfair’s identity, it’s ironic that it now finds itself betting on a new model: Over the last two years, the brand has established three large-format brick-and-mortar stores—with plans for more openings across the country through 2028. With them, Shah sees an opportunity to give customers an experience that blends product with service and ease of use. “The notion that customers don’t want stores is not true, and the notion that customers don’t want online is also not true. I think most customers want both. … There are just times when one is preferable to the other,” he explains.
That rings true at the mass-market level but also, increasingly, in the luxury sector, which Wayfair is addressing with investments into its Perigold brand through the opening of two new stores; by building out its designer trade program; and implementing platform improvements that bring high-end brands under one roof. “The [home] category is very large. … There’s a lot of volume to be had there,” says Shah. “When you think about [a] set of goods, you start thinking about the various ‘good, better, best’ quality tiers, you start thinking about the breadth of styles. Our view has always been: We want to be as expansive as possible to allow our customer to then help find the perfect item, and part of our role from a technology and customer standpoint is to help make it easier for them to do that in an enjoyable way.”
Elsewhere in the episode, he discusses how the K-shaped economy is influencing the brand’s approach, how the designer trade program is evolving, and why he’s optimistic about AI-driven opportunities for growth.
Crucial insight: Despite a challenging economic climate, Wayfair has continued to gain market share. Shah attributes the brand’s success to its fanatical focus on customers. “In a competitive market that’s very fragmented, the innovative retailers … are going to draw [consumers] in,” he says. “We tend not to focus too much on competitors because our experience has been: The way we can do the best is by focusing more on our customers, and understanding what they would desire that we don’t currently do, what they desire that we do better, and then what of the things we do today do they appreciate the most. And then we get very aggressive and try to make our experience and our offerings better for customers.”
Key quote: “This is not an easy category in terms of selling goods, making sure customers know what they’re buying, ensuring that they’re going to have a safe and successful delivery, dealing with any post-order issues. And not everyone who focuses on this category on the e-commerce side really understood the type of customer service and operational logistics capabilities you needed to have. That’s a big piece of what’s made us successful.”
“For manufacturers, for suppliers, for brands, figuring out the internet strategy is a lot more than just where would you want your goods to be available, because to be successful you do need to make sure that that retailer has the logistics and operations capability, has the customer service capability, and then frankly do they have the sophistication and knowledge and capabilities around getting the marketing reach. If they can’t get the marketing reach then there’s no sales to be had and so it’s a lot of work to build up business in any new channel. A lot of it is around the type of content that the brands need to produce, a lot of the work that they need to do inside our platform. [It’s] understanding how to figure out where is a platform, where is a retailer that’s worth investing into because I’m going to get a nice return.”
“Any existing company can do quite well as long as they can stay in touch with what their customer needs.”
This episode is sponsored by Loloi and Maiden Home. Listen to the show below. If you like what you hear, subscribe on Apple Podcasts or Spotify.
The Thursday Show
Host Dennis Scully and BOH executive editor Fred Nicolaus discuss the biggest news in the design world, including RH’s latest earnings report, the spending habits of the AI elite, and a look at what home brands are doing with their tariff refunds. Later, Homes & Gardens global brand director Sarah Spiteri joins the show to talk about a new offshoot publication, Anthology.
This episode is sponsored by Joon Loloi and Lutron. Listen to the show below. If you like what you hear, subscribe on Apple Podcasts or Spotify.
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