Losing Sleep: The Mattress Industry is Burning

There is an adage in the advertising business. Don’t sell the mattress, sell the sleep. The lesson being, showcase the benefit, not the features. It is a smart guidance for anyone selling anything. If you are an internet provider, you do not feature “speed” alone, you show the customer what they can do with that speed and the time saved.

Selling the sleep is something the exploding mattress industry has failed to take to heart. What prompted me to write this was a whopping 8-page ad in the latest issue of Entrepreneur magazine. This spread is from the Tomorrow mattress company. It is a curious piece of traditional advertising for an on-line disruptor. The print ad looks like a software seller’s website.

It starts by extolling a host of company virtues: expertise, innovation, commitment…and American made. When it comes to the product, the “hybrid mattress combines the pressure-relieving comfort of memory foam and the unbeatable support of individually wrapped coils for deep, uninterrupted sleep.” Tomorrow is selling a messy mix of features and benefits in lofty language (their strategy and copywriting need help).

The many page ad goes on to talk about a real-time cooling effect, convenient delivery in a box, one-year trial, along with optional setup and mattress removal. On top of all this, the ad offers $125 off using a provided code. It is definitely a volume-based business to provide all that while discounting. The problem is, there is a high volume of competitors offering the same.

This is an industry now with two sides. You have your traditional manufacturers like Tempur Sealy, Serta and Simmons facing off with on-line, bed-in-a-box purveyors like Casper, Lessa, and Tuft & Needles. Industry sources report that the number of online mattress companies is quickly approaching 200. While that seems overwhelming, the trade publication Furniture Today, reports that these companies command just 12% of the market, up from 6% in 2014, but still a sliver.

Yet, that sliver is having impact. On January 11, 2019, the company that owns Mattress Warehouse, Sleep Outfitters and Mattress King filed for Chapter 11 bankruptcy protection. This is chalked up to industry overexpansion and bed-in-a-box competition. USA Today reports that, “Innovative Mattress Solutions is expected to close some of its 142 stores in the southeastern U.S.”

Not surprisingly, Tempur Sealy is providing a backstop to the bankrupt brand during this process of financial restructuring. They are in desperate need to maintain that distribution for their traditional mattresses. Not to mention the fact that Innovative Mattress Solutions owes Tempur-Sealy $19.3 million.

Innovative Mattress Solutions follows another bankruptcy. America’s largest mattress retailer, Mattress Firm, filed for Chapter 11 in October after “an acquisition spree went awry, discounts undermined profits and digital disruption battered sales.” Mattress Firm is closing up to 700 stores.

Traditional mattress manufacturers are aligned with bricks and mortar retailers while direct-to-consumer, bed-in-a-box hot shots are making bold claims and trying their best to disrupt the status quo. This is nearly identical to the razor industry with Dollar Shave Club and Harry’s. The big difference is those almost 200 new hot shot mattress companies.

Or should I say the big difference is the growing lack of differentiation in the category. Long trials, discounts, free returns, convenient delivery…these are all now table-stakes. On a side note, every company’s site I visited offered a discount, the margins in these businesses must be crap. Soon the industry will jettison those with short runways.

Where does one go to stand out in light of this communication clutter and parity? Keetsa plays up its proprietary BioFoam, Leesa rests on its Avena foam, Purple claims its Floam rules. Do you see what’s happening? These upstarts are already the status quo. They may as well be talking springs and coils. They are getting fooled by their own internal machinations and are disconnecting from customer wants and needs.

A natural response is to sell associated product. Tomorrow has gone that route. One page in that 8-page spread touts a memory foam pillow, sheets sets, comforters, and something called a Sleeptracker Monitor that looks like an iPhone. They are stealing from tech companies by selling “solution sets”. To me, it’s just another desperate act.

Attrition and consolidation are looming. Not all will survive. That is a no-brainer. Still, that does not remove the industry’s biggest problem, finding a true differentiator when both the mattress and the sleep no longer compel.