Do Consumers Really Save Money Buying Bed In A Box?

A lot has been said about the bed in a box business and there is a significant amount of excitement around the category and for good reason; the consumer is looking for a different experience. Here are a few thoughts on why the business has grown so much in the last 12 months:

  1. Consumers don’t really like shopping for a bed.
  2. Large move by consumers to e-commerce in general.
  3. Cool factor and brilliant marketing.
  4. Consumer reviews are driving interest.
  5. Better perceived value on product because of the cost model and high margin at brick and mortar.

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It’s that last one that I want to address here. Has anyone actually purchased one of these beds? I am going to generalize here and bucket them all together so forgive me in advance, but for the most part I have not been all that impressed with product. Do they make a decent mattress? Yes. Is it anything that hasn’t been done before in our industry? No. Are these beds saving the consumer a bunch of money by going direct to the retailer on line? NO!!!!!! At least not from what I see. The big story here is disruption, or at least that is why they were getting so much press. The problem there is that some of those articles were written after doing very little research. The hard truth of the matter is that you can run into a Sam’s Club or a Costco and pick up a bed in the box for less money than what the current e-commerce guys are charging at the same or better quality. My buddy Michael Fux, now the owner of Comfort Revolution, essentially invented this category well over a decade ago and was incredibly brilliant when he designed the wheeled box to get it to your car. Now this concept has been picked up and taken on line which is smart, but I don’t like it when companies BS the consumer.

The e-commerce company goes from the factory, (which they don’t own and have to pay a price loaded with some margin), straight through themselves to the consumer which is a three tier supply chain. If they own their factory then they can claim more of a factory direct but most of them don’t. If it is a brick and mortar retailer they are also buying from a manufacturer, through themselves, to the consumer. That is also a three tier supply chain. I guess you could make the argument that the e-commerce guys don’t have the brick and mortar cost of doing business so they can point to that for savings, but have you priced key words around the mattress category lately? It’s not cheap! You have to build a website that is able to run a robust e-commerce business platform, staff it with programmers, content creators and designers, spend a bunch of money to promote and get your name out there, build in extra dollars to handle returns and when it is all said and done what kind of money are you really saving the consumer?

Many of these guys have really moved away from saying their beds save consumers money because they know that they really don’t for the most part. You can go into any Mattress Firm or Sit’N Sleep out there and find a bed every bit as good as what you will find on line for the same money!

I give Casper and Tuft and Needle credit for making this category cool and for focusing on what matters most when it comes to buying a mattress. The huge benefit of great sleep. I have met both Daehee Park and JT Marino from Tuft and Needle and they are the real deal. Great guys with a very strong business strategy where they put the consumer right in the middle of everything that they do. I am a big fan and hope that they continue to have great success but I don’t agree with the claim of the better deal.

I speak to industry analyst on a frequent basis about this subject so I will tell you what I tell them keeping in mind that it is just one guys opinion. The category is real and is here to stay. The consumer review will continue to validate the concept and I am guessing that guys like Daehee and JT will continue to bring innovation to our business. They will not take over the industry however so we can relax a little. There is only a slice of the market that is going to be okay buying a bed on line. The question is, how big of a slice? If it ever eclipsed 20% I would be shocked but never say never. We don’t want to be the guys making film for cameras, or cd’s do we?

PS- There is no such thing as ONE BED FITS ALL!

 

About Q

Mark Quinn is a 20-year mattress industry veteran with a passion for presenting business in the best possible light. He works hard on strategy and culture, and has a business focus on leadership and marketing. Quinn believes every company is a media company and works hard in the digital space to bring products and stories to the right audience. Family comes first, and FAITH is a verb.
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