Sleep Retailer eNews | August 31, 2017

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A Brick-And-Mortar Renaissance

Tuft Needle Amazon

Tuft & Needle has definitely ruffled some feathers in the bedding industry with its bold marketing strategy, complete with eye-catching billboards proclaiming “Mattress Stores Are Greedy.” With that messaging, it may have come as a surprise to see that the brand recently inked a deal with Amazon to open up new brick-and-mortar showrooms this fall. While perhaps unexpected, this move is actually part of a larger trend we’re seeing across the industry. As more non-traditional brands are investing in physical locations, the future of brick-and-mortar shopping seems bright—if retailers are willing to invest in new creative strategies and digital technologies.

Opening this fall, the new Tuft & Needle/Amazon showrooms will feature plenty of digital technology. Tablets will allow consumers to access Amazon product reviews, while Amazon’s Echo devices will be on tap to answer questions through Alexa voice recognition. But new technology is not just limited to in-store marketing. The stores will also feature QR codes that allow for one-click purchasing directly through the Amazon app. And that’s not all. Some analysts suspect that the next stage of the partnership will include Prime Now integration as well. Available to Amazon’s Prime customers, this two-hour delivery service provides unparalleled shipping convenience.

Another online-only brand making a play for traditional retail is Boll & Branch. The bedding start-up recently announced the opening of its first brick-and-mortar location in New Jersey’s Short Hills Mall. Eschewing the “pop-up shop” strategy that many people have come to expect from online start-ups, Boll & Branch hopes to make its brand more accessible to all customers (not just ones in coastal urban areas). The company owners, Scott and Missy Tannen, see the brick-and-mortar location as an opportunity to deepen consumer’s understanding of their brand. Decked out with raw materials the customers can touch and feel, alongside photos of their factory locations and farm suppliers, the new store was designed to provide a more immersive experience than online shopping. Like the Tuft & Needle showroom, Boll & Branch’s new store will also be very tech-heavy. While the new store will showcase the brand’s full product line-up, the actual purchasing will remain online. All in-store orders will be placed digitally and come with free, next day shipping.

Branded stores are hardly a novel concept in the bedding market, but these new retail spaces are effectively harnessing key strategies that retailers of all kinds can adopt. First, they offer a more concentrated product assortment. According to a forthcoming study in Marketing Science, small format stores are increasingly valuable for brands. Niche retail spaces have been proven to provide brands with a greater increase in sales, when compared to large assortment stores. Brand-specific in-store boutiques give retailers of all kinds the chance to integrate this strategy into their own stores. By showcasing more than just the products, but the stories behind them as well, these spaces give consumers the chance to engage with the brand on a more meaningful level. People still want to touch and feel products before they buy—but retailers need to create an opportunity for them to do that in a way that feels fresh and new. Of course, today’s consumers are still enamored with the ease the e-commerce provides. Successful retailers know that payment systems and shipping processes can no longer be an afterthought, but an essential part of the shopping experience.

Brick-and-mortar retail is far from over—but it is evolving. What are you doing to keep up?

Read More here, here and here


A Strong Summer For Retail Sales - But Are There More Problems On The Horizon?

Financial accounting stock market graphs analysis

Amidst a tumultuous year for the retail industry, summer sales have offered a welcomed reprieve from the doom and gloom of many media reports. US retailers saw a big boost in July, as sales surged by 0.6% to hit to the highest level since December of last year. This recent report also brought with it a revision to the June sales numbers. While a 0.2% drop was initially reported, it has since been updated to show a 0.3% increase for June. Consumer spending as a whole is also up, with the second quarter increasing at a 2.8% rate, following a more conservative 1.9% rate in Q1. While the uptick in sales is a good sign for how the retail market will perform in the second half of the year, there may be some problems brewing under the surface. Wage growth in the US has been steadily sluggish in recent years and the consumer saving rate has dipped significantly as well—a combination that poses a clear risk to maintaining positive spending growth.

While online sales continued to outpace brick-and-mortar (thanks, in part, to the success of Amazon’s Prime Day), traditional retailers had much to celebrate as well. “American shoppers flocked to the malls in July,” Sal Guatieri, a senior economist at BMO Capital Markets, told Reuters, “suggesting consumers are well-positioned to propel the economy forward in the second half of the year.”

Of course, consumer spending is only one piece of the overall economic puzzle. American wage growth has struggled to push past 2.5% in recent years. Additionally, the saving rate topped out at just 3.8% in the second quarter of this year, a serious drop when compared to 6.2% in Q2 of 2015. With stagnant wages and limited savings, consumers would have to increase their borrowing to maintain the growth of spending that the industry is currently experiencing. While sales are expected to remain strong throughout the remainder of 2017, these trends may have a greater effect own the line.

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Casper Introduces “The Wave” Mattress

Casper Wave Mattress

Casper recently unveiled The Wave, the newest addition to its growing suite of sleep products. Designed in the company’s new research and development lab in San Francisco, the new mattress touts a more response design—and a much higher price tag. Ranging from $1,000 for a twin all the way to $2,250 for a California king, the Wave is nearly twice as much as the original Casper mattress. Made from a combination of latex, flo and memory foams and sporting a contour cut support layer, the Wave was designed to provide both “soft plushness” and proper ergonomic support. With a price point comparable to many existing brands, Casper’s new foray into the “premium” market appears to signal yet another shift towards more traditional industry strategies.

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My First Month In The Sleep Industry

Business Idea

By Elaina Hundley, Sleep Retailer Marketing Manager

After more conversations, much more reading and subsequent research, my mattress and bedding knowledge is ever-expanding and my overall impressions and ideas about the industry are beginning to take shape.

Here are a few more observations from me, your resident sleep industry newcomer:

Details of Craft

In my last column, I wrote a bit about the attention to detail that is so characteristic of the bedding and mattress industry, particularly in the choice of material, design and presentation. Now that I’ve perused more company websites and started to dig deeper into what separates each brand from the next, I am starting to pick up more lingo and understand some of the basics of mattress materials, and the benefits of each.

Let’s stick to materials this time. I’ve learned the laundry list of them; gel, memory foam, adjustable air, latex, innerspring and more all make up the mattress material spectrum. The variety here is confusing at first but makes sense. Mattress manufacturers today work hard to offer enough variety to meet the needs of their consumers - and no one sleeps exactly the same. Though innovation has always been a hallmark of the sleep industry, each year new trends and new products keep complicating mattress construction and improving sleep, acknowledging the individuality of shoppers, their needs and preferences. In addition to affecting features like firmness and coolness, the choice of materials is what separates your everyday mattress from elite luxury bedding.

Brick & Mortar v. Bed-In-A-Box

I am quickly learning that the industry disruptor du jour is the bed-in-a-box phenomenon, which is certainly inspiring fear in the hearts of traditional retailers. One thing is clear though, smart manufacturers stay on the cutting edge by offering RSA’s support in selling their products and smart retailers seek out products that make their showrooms more dynamic. What appears most successful so far for the in-store experience are products that include a tech component that makes it crucial (and fun) for a consumer to try out the sleep system or accessory in store. For example, Protect-A-Bed’s Sleep Tailor recommends a pillow for the in-store consumer, it’s an interactive marketing concept and it makes the consumer feel special - it’s tailored to them and their preferences.

Although bed-in-a-box companies feel like tough opponents to match, buyers still seem to really like touching and feeling and testing their mattresses prior to purchase. I think the real key for retailers and what I believe will help them stand out, is to ensure that the in-store experience is a strong, welcoming and engaging one.

The Many Stories of Sleep

The final aspect of the bedding and mattress industry that I noticed last time was the marketing behind sleep. Brands have to develop a clear and consistent narrative to remain vibrant in the minds of retail buyers and consumers. Now that I’ve dove deeper, I am starting to understand the vast variety of stories that are characterizing sleep in today’s market. There’s performance sleep, the kind that athletes and high-powered professionals need to keep going for the gold. There’s clean sleep, sleep that is void of chemicals and protects a consumer’s growing family. There’s philanthropic sleep, when you purchase a philanthropic night’s sleep, you help your fellow human. These are just a few examples.

I don’t think this style of narrative-oriented marketing is limited to the bedding and mattress industry though.  I believe that today’s consumer is more discerning in general. They have access to information and can do their own research, the integrity of any given product is easy to discover online, but the story and the personal touch the company provides through their website, marketing collateral, packaging and service are what make brands successful and keep consumers coming back (and sharing positive stories with their friends).

That’s what I’ve noticed! Thanks for reading. I hope to keep absorbing and understanding the industry’s trends and trademarks month after month!


Losing Sleep Could Mean Gaining Inches At Your Waistline

insomnia

By now, we all know that adequate sleep is crucial to maintaining both mental and physical health, and we know that most of us aren’t getting as much sleep as we should. Thanks to a myriad of scientific studies, we also know that chronic insufficient sleep has a direct link to long term health consequences, including obesity, itself a global epidemic that continues to increase year after year. Now, new research recently published in PLOS One shows even more clearly just how closely tied sleep and metabolic functions are, illustrating the correlation between fewer hours of sleep and both an increased BMI (body mass index) and waist circumference.

The research, performed by scientists out of the Institute of Cardiovascular and Metabolic Medicine at the University of Leeds in the United Kingdom, assessed 1,615 British individuals between the ages of 19 and 65 using food/sleep logs, as well as blood tests, waist measurements and blood pressure readings to evaluate participants’ overall metabolic health. Across the board, subjects who averaged around six hours a night, performed worse than those who slept more. In addition to supporting previous research that focused on poor sleep and increased weight, scientists found that these “short sleepers” not only had a waist circumference three centimeters larger than those who slept longer, but they also produced less HDL “good” cholesterol (increasing risk of heart disease) and had a higher BMI.

Surprisingly, the research didn’t find that fewer hours of sleep led to poor eating habits, a theory that has been posited in the past. Neither did the study focus on chronic sleep deprivation and its effects over time, but was an informational snapshot of the relationship between sleep habits and metabolic health.

According to lead researcher Dr Laura Hardie, "Because we found that adults who reported sleeping less than their peers were more likely to be overweight or obese, our findings highlight the importance of getting enough sleep.” Although she cautions that sleep is not necessarily a one-size-fits-all activity because "How much sleep we need differs between people,” she does advocate that “the current consensus is that seven to nine hours is best for most adults."

If previous research hasn’t motivated you to be more mindful of the sleep you’re getting, perhaps this new study can spur you on to adding zzzs to your sleep schedule instead of inches to your waist.

Read more here, here and here.


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