SVA MA Design Research

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Declutter or Die: How the Home Organization Industry Designs the Metaconsumer – SVA MA Design Research

Lisa O’Neil

Declutter or Die: How the Home Organization Industry Designs the Metaconsumer

Screenshot of TCS Closets product line from Container Store website, 2018.

Revenue at The Container Store (TCS) was $820 million in 2016, a healthy 5.1% slice of the $16 billion US retail home organization industry, making it the category leader.  While total revenue did shrink slightly from the previous year, a development the company attributes to challenges faced by all US brick-and-mortar retailers, TCS predicts that its deep, decades-long understanding of American consumers’ storage needs will help it resume financial growth.

The company’s own numbers illustrate the magnitude of demand for home storage products in the United States. TCS offers 11,000 items for sale online and in its eighty-six stores, which occupy over two million square feet of selling space. The company divides its store offerings into sixteen “lifestyle departments,” with the closet department offering over one hundred different clothes hanger designs in a multitude of colors and materials, and the kitchen department offering over four hundred products specifically for food storage. The highest revenue category of TCS’s business is the custom closet, currently nearly half of TCS total sales and growing.  The largest contributor to the category is TCS Closets®, a luxury custom closet product line launched in late 2014 and now averaging $10,000 per customer purchase.

The TCS Closets® product line has been so successful that the company plans to expand it with additional products for organizing other areas of the home. TCS has also begun further assisting customers seeking storage nirvana by partnering with a financing company to offer the TCS Credit Card. The card’s annual percentage rate of 29.99% is waved for two years on purchases of $3,000 or more, and the company reports that custom closet purchases made with the TCS Credit Card have a significantly higher average ticket than those made with other payment methods. TCS makes no report of how much of these purchases end up accruing nearly thirty percent interest.

The company, which was founded in 1978 and went public in 2013, believes that its leadership of the home organization sector will continue due to its curatorial approach to selling its merchandise and the talents of its salesforce. Its five thousand employees are clearly a happy lot, putting the company on Fortune magazine’s “100 Best Companies to Work For” list eighteen years in a row. The company also maintains that its success is due to its philosophy and core values, which include Conscious Capitalism®, Organization with Heart®, Foundation Principles®, Good People®, and the crucial Art of Excitement™ in each of its stores.  

Concealed within these trademarked values is what TCS touts as the unique ability of the its salesforce to “astonish” a customer seeking a shoe rack by upselling her via discovery of “her underlying storage and organizational challenges,” thus making both the customer and the shareholders happy. This skill set was on display during a recent visit to the TCS store on the Upper East Side of Manhattan, where a consultation with a TCS Closets® salesperson did indeed produce an astonishing quote that approached the cost of a midsize American sedan.

Key References:

The Container Store, 2016 Annual Report, http://s1.q4cdn.com/151424094/files/doc_financials/2016/The-Container-Store-Annual-Report_Bookmarked.pdf, accessed April 2018.