In 2017 Bed Bath & Beyond quietly acquired the online interior design service Decorist for an undisclosed amount. Prior to that, Decorist had raised $4.5 million in seed funding from home improvement chain Lowe’s, the Women’s Venture Capital Fund and other angel investors.
Decorist was founded in 2014 by Gretchen Hansen, who continues as its CEO, after she made a mistake buying chairs for her office. She snapped some pictures and sent them to an interior design friend who worked remotely and returned a design that turned her office into a workable and beautiful space.
That was Hansen’s a-ha moment. She figured that many people had similar interior design challenges but didn’t know where to turn. They needed a designer on call. Decorist was born, offering a quick and affordable solution to interior design challenges through a virtual design service.
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Decorist CEO Gretchen Hansen says, “Virtual design is not going away.”COURTESY OF DECORIST BY CAROL VAZIRI
During BBBY’s fourth quarter 2016 earnings call, then CEO Steven Temares explained where the acquisition of Decorist fit into the company’s plans: “As the interior design arm for Bed Bath & Beyond, we plan to leverage Decorist online platform to initiate and/or enhance our design consultation offerings for some of our concepts.” Temares exited the company this past May.
But since then, Decorist has operated largely under the radar. Only recently has the company’s BuyBuyBaby arm made Decorist’s design services part of the in-store shopping experience, though Decorist design services are offered on Bed Bath & Beyond’s website.
BuyBuyBabyNYC in-store design serviceCOURTESY OF DECORIST BY GENEVIEVE GARRUPPO
Since August Decorist services have rolled out into five of the 126 BuyBuyBaby stores, including Pleasant Hill, California, Brooklyn and Manhattan (Chelsea), Downer’s Grove and Naperville, Illinois.
In these five stores a selection of nursery vignettes are staged using designer selections drawn from BuyBuyBaby’s existing product line.
The in-store design experience is supported by a proprietary 3D-imaging tool, called Room Builder, where the client inputs their exact room specifications, e.g. doors, windows and walls, so they can see on the screen how the furniture and décor will look in their own space.
What is Decorist’s future with Bed Bath & Beyond?
With new CEO Mark Tritton coming to BBBY from Target after what fellow Forbes.com contributor Warren Shoulberg described as “the most tumultuous year in the 40-year-old retailer’s existence,” a question remains about where Decorist fits.
In September BBBY chairman Patrick Gaston and interim president Mary Winston issued a shareholder’s letter outlining the company’s turnaround plans, which includes editing the number of brands they operate by “reviewing and optimizing our asset base” with the help of Goldman Sachs.
“They have given no specifics,” Shoulberg shared with me. “Speculation is that they will eventually circle the wagons around Bed Bath & Beyond, BuyBuyBaby, with perhaps Christmas Tree Shops remaining as well. Everything else will go one way or another. I guess that would include Decorist, which is a brand they pretty much have never talked about since acquiring it to the point that I forgot they owned it.”
If Bed Bath & Beyond does decide to spin off Decorist, an even bigger question remains about where online design services like Decorist, as well as competitors Havenly, HomePolish, Modsy, and others, fit into the traditional interior design industry. It is an industry built on a personal one-on-one client relationships with well-heeled clients who can pay for such ultra-luxurious service.
“Ours is a new model,” Hansen told me during a telephone interview. “Most people have had to design their homes themselves and couldn’t afford to hire a full-service interior designer. We help customers bring a professional design aesthetic into their home. This is a new category in design and we are building it out. Of course, there are competitors, but we think competition is good for everybody.”
New kind of interior design for a new target market
Stating that awareness of online design services like Decorist has grown from virtually zero a few years ago to around 20% to 25% today, Hansen sees her company’s expansion into physical retail with its BuyBuyBaby nursery design program as critical to extending her company’s reach to Millennial HENRYs (high-earners-not-rich-yet), who are starting families and have well-paying careers but with an expectation of far greater earnings to follow.
These next-generation consumers are the ones that the entire interior design industry needs to cultivate. By communicating with them in their native digital language and putting the service in front of them in BuyBuyBaby to design their newborn’s nursery, a milestone in young couples’ lives, Decorist is positioned to get a leg up over competing online design services.
But more importantly, it gets an opportunity to introduce these customers to what a professional designer can do, giving it an advantage over traditional designers as well. When these customers face a bigger design challenge later in life and with fatter wallets as their income grows, Decorist is there waiting for them.
“It’s a Pinterest/Instagram world. With so much design inspiration available, people get stressed out and overwhelmed about how to take those ideas and get it to that final magazine-worthy level, which they all want,” Hansen explains. “So we come in, take the ideas, pull it all together and deliver a design that looks good with the proper layout and most especially that works for their lifestyle. The average person doesn’t have the time or expertise to create a beautiful room.”
Decorist designers generally source products from a recommended list of 200 vendors, though they can venture beyond that list to other sources depending on the client’s needs.