Mike Dunlap is hopeful.
The veteran of nearly 40 years in the furniture industry and principal of Holland-based Michael A. Dunlap & Associates is looking forward to NeoCon 2016, the premier design convention being held in Chicago next week. He thinks that after more than a 20-year drought of game-changing products, the furniture industry is ripe for something truly innovative.
“Whether it arrives this year or in another future year, I don’t know, but somebody is going to create something that is going to change the industry enormously,” Dunlap said.
A dearth of innovative products hasn’t necessarily translated into lower sales numbers.
Herman Miller saw a 13.8 percent increase in revenue in 2015 over 2014, from $1.88 billion to $2.14 billion, according to Business Journal research. Haworth also saw a slight uptick in revenue from last year to this, up to $1.82 billion in 2015. And Steelcase made $3.1 billion in 2015, as it did in 2014.
Still, Dunlap stresses the importance of a breakthrough product to keep the industry from growing stagnant. He cites Herman Miller’s Aeron chair in 1994 as the last blockbuster product to radically change the market, though noted recent products like Steelcase’s Media:Scape line have been examples of smaller innovations.
Dunlap said part of the issue stems from the lengthy product development process — anywhere from three to five years from conception to launch. Manufacturers are peering into a crystal ball, trying to determine what the market will demand by the time the product is ready to launch.
“The products we’re going to see at NeoCon 2016 were probably started in 2012 or 2013 at the earliest,” Dunlap said. “And the market has changed quite a bit since then. So the question becomes, are the manufacturers driving what the market wants, or does the market really drive what the manufacturers produce?”
A reduction in the time it takes to bring a product to market is a place to start, but Dunlap also said he would like to see more risk-taking from what he calls the “big five” furniture companies: Herman Miller, Steelcase, Haworth, HNI Corp. and Knoll.
The trend of risk-averse culture at the top of the totem pole can, in part, be traced back to the economic changes in the last couple decades, Dunlap said.
Dunlap added he would like to see the millennial generation more involved in decision making.
“I really don’t think the major decision makers are giving enough credit to the millennial, and even beyond, generations in terms of what types of products we want to have on the market in the next three to five years,” he said.
But with money still being made, where is the incentive to put out a product that could spur a radical shift in the industry? Dunlap said it comes back to the Aeron chair in 1994, likening the risks taken in producing a chair that had been initially rejected by market testing to one of the most successful American cars in history — the Ford Mustang.
“That chair entered the market and it wasn’t based on anything else other than the knowledge of the two primary designers,” he said. “They created something totally new, and at the same time, their market research focus groups rejected it. But they did a good job of marketing it, got it recognized by the New York Museum of Modern Art, and it went from trash to cash.”
Dunlap hopes manufacturers can see the returns on innovative products and recapture some of that boldness.
“I’m very hopeful that the 2016 NeoCon — and next few years — are going to help stimulate some new creativity and dramatically inject some new ideas into the commercial furniture industry,” he said.