How to Inspire Home Improvement Spending in 2025 and Beyond

Home improve­ment is a lot like eat­ing pota­to chips, once you start, it is tough to stop – home­own­ers want to make improve­ments to their space. Whether it is to spice things up or mak­ing a nec­es­sary repair, a sim­ple update or a com­plex fix, most con­sumers do one or more home improve­ment projects a year, and 95% make a home improve­ment prod­uct pur­chase annually. 

Current State of Discretionary Spending in 2024

Accord­ing to retail sales data from Cir­cana, con­sumers are spend­ing less on non-food pur­chas­es. This repri­or­i­ti­za­tion in spend­ing comes as a result of increased cred­it card debt and increased prices for many month­ly expens­es. Home sales and larg­er home improve­ment projects have also slowed, with high­er inter­est rates play­ing a sig­nif­i­cant role. But, there are still oppor­tu­ni­ties to engage the con­sumer. Accord­ing to a recent con­sumer sur­vey, of the peo­ple who typ­i­cal­ly hired a pro­fes­sion­al for home improve­ment, home repair, or lawn and gar­den projects, more than half plan to do more of these projects themselves.

What can the Home Improvement industry do to grow in these challenging economic times?

It comes down to inspir­ing and entic­ing the con­sumer with less expen­sive and more focused home improve­ment solutions. 

• Sim­ple updates. Whether it is a new appli­ance, fur­ni­ture, décor, tex­tiles, tools, or a pur­chase to make a small update to any part of the home, these changes can still spark fresh­ness in a space, even if not relat­ed to a big­ger project.
• Do-it-your­self projects. Big or small, encour­ag­ing con­sumers to embark on their own home improve­ment projects can go a long way – in terms of the sat­is­fac­tion with the end result, as well as the cost sav­ings. In the past year, con­sumers have geared up for projects, with 4% growth in sales of tools in the 12 months end­ing June 2024. 
• Spread the TLC to new spaces. Look to the parts of the home that may not get as much atten­tion, or where the cost to make an impact is more man­age­able. Lawn and gar­den sales are grow­ing, up 16% from last year. Beyond the weath­er fac­tor, updat­ing the out­doors can be an reward­ing spruce-up activ­i­ty with lit­tle expense, and con­sumers can eas­i­ly set their own parameters.
• Dial-up expe­ri­ences. The pur­chase of the lat­est and great­est grilling tool can be the cat­a­lyst that enhances out­door enter­tain­ing, encour­ages more out­door cook­ing, or even prompts some tail­gat­ing activ­i­ties. In the past year, sales of portable grills grew 18%, and total sales of out­door grilling prod­ucts, includ­ing grills, fuels, and acces­sories, are up 3%.

Understanding the consumer’s lifestyle is the key. 

Dif­fer­ent gen­er­a­tions have dif­fer­ent inter­ests and needs that can be lever­aged to get their atten­tion, and their home improve­ment dollars. 

Gen Z

Look­ing at share of wal­let, we know that 18 – 24 year olds index high for tech­nol­o­gy. They may be enticed by the idea of build­ing their own work/​play environment. 

Millennials

The 25 – 34 age group is more focused on major life moments, includ­ing get­ting mar­ried and pur­chas­ing a first home. Help them pre­pare for the road head with the right tools and a roadmap of the best small projects to get start­ed with.

Gen X

The prime years for a focus on fam­i­ly, enter­tain­ing, and at-home liv­ing is where 35 – 54 year-olds are at, and these con­sumers are like­ly to have a long wish-list of projects. Curat­ed ideas can ease some of the feel­ings of being over­whelmed, and help to moti­vate these con­sumers to get start­ed. Social media is an ide­al tool to engage con­sumers with this kind of inspi­ra­tion, and one that oth­er grow­ing indus­tries, like beau­ty, are lever­ag­ing to gen­er­ate inter­est and excite­ment around new and exist­ing products.

Baby Boomers

Con­sumers age 55 and old­er tend to allo­cate a larg­er share of wal­let to home improve­ment through­out he home. Emp­ty nesters may be ques­tion­ing whether to upsize, down­size, or remod­el. They also have added dis­pos­able income to allo­cate to updates to their exist­ing home or buy­ing and updat­ing a sec­ond home. Address­ing these ques­tions and needs pro­vides many oppor­tu­ni­ties to inspire this consumer.

Looking Ahead

Con­sumers are feel­ing the finan­cial pinch, but they still care about their homes, and how their liv­ing space makes them feel. As an indus­try, we must inno­vate with this in mind, bring­ing inspir­ing prod­ucts and ideas that make var­i­ous kinds of home improve­ment spend­ing a pri­or­i­ty this year.

Get More Home Improvement Insights

If you’re ready to learn more about the cur­rent state of the home improve­ment mar­ket, join us from 7:00 – 8:00am on Sep­tem­ber 19 for our com­pli­men­ta­ry break­fast at the HIRI Sum­mit, hap­pen­ing Sep­tem­ber 18 – 19, 2024 in Chica­go.

About Circana

Cir­cana is a lead­ing advi­sor on the com­plex­i­ty of con­sumer behav­ior. Through supe­ri­or tech­nol­o­gy, advanced ana­lyt­ics, cross-indus­try data, and deep exper­tise, we pro­vide clar­i­ty that helps almost 7,000 of the world’s lead­ing brands and retail­ers take action and unlock busi­ness growth. We under­stand more about the com­plete con­sumer, the com­plete store, and the com­plete wal­let so our clients can go beyond the data to apply insights, ignite inno­va­tion, meet con­sumer demand, and out­pace the competition.