What I Learned At Las Vegas Market

Posted 3 CommentsPosted in advertising, creativity, e-commerce, fun, furniture, Leadership, marketing, mattresses

We just got back from a very successful trip to the Las Vegas Furniture Market. I know a lot of you reading this don’t really like going to Vegas but that’s not me. I love the energy of that town, the incredible food, amazing shows, and the best people watching anywhere in the world. We did have to work however so we put on some comfortable shoes and went to market and boy was it good.

First of all my thanks to my Josh Miklos, my brother Jeff and the real workhorse Jennifer Parrish for having Spink and Co. as a guest of Dormeo/Sinomax. They were very gracious and nice to include us! Both Dormeo and Spink and Co. had an incredible show, so a big THANK YOU to all that stopped in!

Market is THE place to shop for new lines or sell your new products, but it’s also a great teacher if you are paying attention. So what did I learn this trip?

  • It blows me away at how many mattress producers there are showing in Vegas. Who buys all of these beds?!? Showroom after showroom of rectangles that all pretty much look the same excluding the variation of color and some details on the finish. Just like retailers floors, I guess. More of the same until you run into something that isn’t and when you do…you certainly know it. So does the consumer. Takeaway: The people with new and different win the buzz in the hallways.
  • There was a lot of disappointment with some of the large bedding brands out there. Boring products and poor service continue to be “accepted” by many retailers but from what I was hearing, the patience for that might be running out. To the retailer’s credit, they have given the aforementioned brands a lot of grace which we all need every now and then, but I think people are fed up.
  • My very good friend Mike Magnuson, founder of goodbed.com, is ridiculous when it comes to putting away all you can eat sushi. Mike puts on a clinic when we go and the owner of the restaurant stands in the corner shaking his head in frustration as we order roll after roll of our favorites. Don’t believe me? Ask Jeff Cassidy, Mark Kinsley, or my sister Cari Quinn, they were all there. Next…I think we let Mike take a shot at the Old 96’er. #nomorefoodforyou #youmustgonow
  • I remember when bedding brands would reluctantly roll out a mattress in the box and put it in the corner or back room to show retailers when this all first started. Not now. Everybody is in the game and doing everything they can to hitch their wagon to the growth. Compression bedding is in the spotlight, even if you aren’t selling beds online.
  • There are a lot of retailers out there in search of answers. Traffic is down, sales are off, and many just don’t know why. My hope for them is that they realize the products they carry matter more than ever, protecting their margin is critical, and promoting only product, price and promotion will kill your business and falls well short of where you could be.
  • My friend Doug Krinsky had another huge year at the Ante 4 Autism event raising $147,187 and over $700,000 since 2008. I could not attend due to an important business dinner but my heart is with them every year as this is such a great cause. Go next year if you can, you won’t be sorry.
Mark Kinsley, Mike Magnuson, Cari Quinn, Mark Quinn, Jeff Cassidy

I know that this is going to sound a little mushy but it’s true; I love seeing so many friends each year. The best part of attending market are the brief moments with old friends, hugs in the hallway, photo ops and riding in elevators with David Perry. Seriously, you guys make market great for me so thank you for your friendship, positive feedback on the blog and podcast, and for taking time to stop in and see the new Spink and Co. collection. It means more than you will ever know.

Best Showroom In Vegas. Great Experience Guaranteed!

Posted 1 CommentPosted in creativity, experience, fun, furniture, Leadership, marketing, mattresses, product development, Retail

You are the coach of your kids basketball team and you’re running a motion offense but can’t get the ball to the hole. Do you continue running that same offense or do you try something different that will have a better outcome? You change it up of course! Is business any different?

With Spink and Edgar, we have been working hard to make awesome beds with mostly natural materials grown on our very own farm in Yorkshire, England. The first two versions of the product sold well but we weren’t getting the traction we thought we should so we started talking to the rsa’s that were selling our beds and based on those conversations, we made some big changes to our products over the last 6 months.

  •  We increased the mattress profiles in a big way to improve the perception of value in the luxury space.
  • Placed some very soft foam in the quilt for additional comfort and base foam under the core innerspring to give more structure to the mattress.
  • Started using some very soft, puffy, beautiful stretch knit fabrics so we could better feel the unique raw materials in the product.
  • Because of the fact that we are using small amounts of foam we have been able to differentiate the feels in the collection in a more significant way.
  • Speaking of feels, consumers are going to fall in love as soon as they experience these mattresses!

When we first launched Spink and Edgar we really wanted to keep the product all natural but the fact is, if we continued to do that we were really only targeting about 5-7% of the market. Consumers LOVED the fact that we didn’t use foam however, we just couldn’t get the beds to feel and look the way they needed to in order to be one of the dominant players in the luxury category.  If all we do is make a great bed then we will have to compete with all of the other great beds out there. What happens when you stir in one of the best selling stories in the industry? Here are a few things that separate us from everyone else:

  • We still grow our mattress on our very own farm in England. “From our farm to your bedroom.”
  • The Queen of England continues to favor our company with awards for innovation and international export.
  • We feature the micro-coils that were designed by my partner Simon Spinks that allow us to have coil counts that are 3-5x’s higher than anyone we compete with. Coils extend comfort life. Coils sleep cooler. More coils deliver more support.

When our team finished the product development process we couldn’t help but feel like we had made a mistake on the earlier versions. Maybe we should have used some foam in our beds when we started? Maybe staying too focused on the natural customer was limiting our success. Maybe so. Probably so; but what are you going to do? You evolve and make sure that you are committed to the best possible outcome no matter how many times you change things up. What’s important is that we’ve made a few tweaks and are bringing products to LasVegas market next week that will give our customers something very special to sell that will justify those big price points and profits retailers are so hungry for these days.

It’s not about where you start, it’s about listening to people that matter and knowing when to alter course to get you to the place you want to be. There are many failed companies out there that didn’t listen, didn’t change, and also didn’t succeed.

I am very proud to be partnering up with Dormeo this year in Vegas. They have a great showroom in building B space 980 right off the escalator so come in and pay us a call. These guys are nice enough to give the all-new Spink and Co. collection some wall space to show off our new stuff and the fact is, that we are all in a similar boat.

Dormeo has new products that are unlike anything else in the market utilizing their patented Octaspring technology. In addition, they can deliver a similar “sleep cool” story with the increased airflow in their mattress vs. other memory foam products and they are using much better quality and density foams than almost everybody out there. Bottom line is that we both have a mattress line that delivers big tickets, big profits, exclusive distribution opportunities, with incredible selling stories. Win/Win/Win

Don’t take our word for it, stop in and experience these products for yourself. I promise there won’t be anything like it in all of Las Vegas! We also have some special hangover cures if you’re out too late one night. Come by and let Dr. Quinn, Medicine Man set you up. Where else can you go for that?!?!?

Wanting It To Be True Won’t Make It True

Posted 4 CommentsPosted in advertising, creativity, e-commerce, experience, furniture, Leadership, marketing, mattresses, product

I haven’t seen the numbers for 2018 but I’m guessing that the e-commerce/direct to consumer channel has yet again captured the majority of the industry growth. This is where most of the advertising dollars are being spent and no doubt where the excitement and momentum is at the moment. So what role are you playing as we watch this shift happen?

Are you one of the people that explains it away saying that it will cap out soon because return rates are high so the business model won’t be sustainable. There are also those that believe the cost structure is out of wack and it’s impossible for those guys to make money because of the required ad spend to get traffic to the sites? How about the opinion that consumers want to feel the bed before they buy it so most people won’t be going online to purchase a mattress. If you or your company is buying into some version of this narrative, you could end up like Blockbuster or Toys R Us.

One-sided beds worked, memory foam isn’t a fad and continues taking market share from traditional mattresses, and beds in a box are here to stay. We may not want to believe something is happening so to make ourselves feel better we look for big rocks to hide behind. These rocks will cost us our business if we don’t get real with what’s going on.

Many large brick and mortar retailers still haven’t created the kind of experience that will make their customers actually WANT to come in and shop with them. Product for a price advertising is still the go-to for many in terms of how they spend their money so there is very little to no emotional tug or connection to the people that they want shopping their stores. (Emotions drive the sale right?)  The vast majority of retailers are giving most of their floor to products that customers can find anywhere in their market vs. the e-commerce guys all offering something totally different from the competition. So why is this all happening?

Either the brick and mortar guys don’t believe in a unique shopping experience, strong messaging, and differentiated products, OR, they are finding their own way to convince themselves that the path they are on will be good enough.

It won’t.

The convenience of the internet, social proof of 5-star ratings, and the desire to avoid the painful process of trying to understand/shop the mattress category are going to give consumers every reason they need to shop online. It’s not going to gobble up all of the business but I think where we are is just the beginning. The GOOD NEWS is that there are ways to prevent it from happening to your stores.

We have the merchandising part figured out for you. If you’re a retailer and want to see the most compelling/unique product solutions in Las Vegas come visit me in B980 and see what the all-new Spink and Co. and Dormeo collections can do for you in 2019. Give your customer something special and they will reward you. It’s only part of the solution, but a very profitable part.

What Happens If Our Industry Shifts To 50% Direct To Consumer?

Posted 7 CommentsPosted in advertising, creativity, culture, faith, furniture, Leadership, marketing, mattresses

Ride-sharing is going to change a lot in the coming years. Younger generations are not buying cars like my generation did. When I turned 16, I couldn’t wait to get my license and a car to drive around in. These days you have to drag your kid to the DMV just to get them to take the stupid test. How about you, are you renting less cars when you travel on business? Taking less taxi’s? Will fewer cars be produced as this plays out?  My point is that there is a ripple effect from the rideshare industry if you look at it.

In the spirit of that idea, what is the ripple effect going to be if some of the analysts are right and 40-50% of mattress sales will be in the direct to consumer channel? I don’t have the answers but I have some thoughts on how it could impact the brick and mortar guys and manufacturers out there. Much of what you read below is true today, but not to the degree that they will be as things tighten up. Some will be right, others not even close. You decide which is which:

  • Only the very best sleep shops will survive as they don’t have furniture to supplement their business OR they will expand product assortments to include more than mattresses and sleep essentials to appeal to a larger audience. They will need to focus more and more on unique products that deliver big tickets and healthy margins so that they are not in the commodity business which will be well served online. They will need to create an experience that justifies the consumer’s visit to their store and has them leaving, and telling their friends.
  • Brand awareness in the brick and mortar space will mean JACK SQUAT (apply the same logic here to bedding products). If you don’t have a strategy to build a relationship with your consumer and create a real PREFERENCE for your store or product then you probably won’t make it. Why would anyone WANT to visit your store or buy your brand? Can YOU fulfill a promise that others can’t? How have you earned their loyalty? Do you do something totally extra that the rest of the market isn’t doing? Do people LOVE YOU because of your business philosophy or the way you support your community? Low prices and constant sales aren’t going to work; consumers can get that online.
  • Foam will grow in market share as a way to build a mattress. Innersprings are still participating but not at the same rate if the current trend continues.
  • Foam producers are going to have to differentiate their 10-12” thick products if they are going to expect premium prices which will require either a big brand spend or a product that is clearly different along with a great way to communicate their superior approach. The bastardization of foam beds will continue as it did for innerspring hence the creation of the hybrid category.
  • Hybrid producers will need to do the same and justify why having a coil in a bed makes more sense and how their approach to that product is simply better. Value has to be built by someone.
  • We will see a consolidation of bedding producers. SSB and TPX could both shrink drastically unless they bump up their D2C push even more which we already see happening, or increase their marketing spend.  Other producers that are smaller in size will likely go away unless they do the same and flatten out their distribution model online or with a factory direct approach.
  • Bedding brands will be in a fierce fight for retail space so the brick and mortar guys will have much more leverage with slotting fees, co-op etc. This could drive investment spending up, and value to the consumer down making D2C even more viable.
  • As brick and mortar companies strive to maintain their business and become more profitable so they can chase the consumer with the required bigger ad budget, they will be looking for their product lines to produce better margins with larger tickets (sell more to the people already coming in your store). This will drive interest in products that are legitimately different with stories that justify better tickets. Craft beer/craft beds will grow quickly as a percent to total.
  • As a result, producers that are willing to give limited distribution to retailers could have an advantage in the brick and mortar space.
  • The business discipline of marketing will become more and more important to every company out there. Anyone with a strong understanding of how to tell their story in a cost-effective way will have a distinct advantage. It’s not about running a chain of stores or building a bed. It’s about differentiation and how you capture the hearts and minds of the consumer. Even if you are just trying to sell as many widgets as you can for the low price in the market, you’re going to have to know how to get an audience and convert them into a sale. There has never been as much advertising in the category as there is right now so you need to understand how to break through the clutter with the smallest budget possible.
  • For bedding manufacturers, the lowest cost producer will have the edge as they are able to produce velocity price points (private label programs), in a way that allows the retailer to deliver better value. To my earlier point, if brand awareness is much less important, then price will win the day and the low-cost producer can deliver the best price. This is true today but for whatever reason, retailers are still paying slight premiums for brands that don’t mean much of anything to consumers. (At least the brick and mortar guys are, the e-commerce guys have figured this out and are doing their own thing.) At some point the best retailers will stop doing that and look to their own marketing/selling departments to drive the business and build store and brand preference. The trend is already there if you are paying attention.
  • Big slotting fees will likely go away in their current form. Taking big payments for multi-year deals from brands that aren’t relevant anymore, will take a toll on retailers business. SKU’s need to produce and more importantly, mean something to the consumer. If you aren’t bringing your consumer cool treasure hunt type stuff (think Costco), then the consumer will likely stay home and shop in their underwear. What’s more important; a big payment up front or products customers absolutely love? Are you playing the long game or the short game?
  • Strategic partnerships will be more important. The progressive manufacturers out there are going to figure out that they need to be about more than making products. The companies that bring additional value to the table will have a big advantage when it comes time to fill slots on the brick and mortar floors. If producers bring PROGRAMS vs. PRODUCTS they can win the business from the companies that refuse to evolve. If you can add value above and beyond table stakes, then you make yourself more valuable to the market. Are you really in it for your customer and their success or are you just trying to sell stuff? What is the evidence of that?
  • Creative thinkers and company cultures that celebrate creativity will be more important to than ever before as competition gets even more fierce. The market will demand innovative components, new sleep solutions, retail concepts that attract consumers and transcend the current model, new selling processes that help the consumer connect to the right products for them to improve sleep.  If you are going to do things the same old way, it will become more difficult to compete. Consider the “sleep shop”  and various mattress/pillow/sheet brands today and how many of them are really different from one another.

If you make things, how important are the above points going to be to you when it comes to winning the business from a consolidated retail base? If you’re a brick and mortar retailer, how are you going to win the battle with competitors down the street and the pain in the rear e-commerce guys that in many ways are overpromising and under delivering? So what did I get right or wrong? Let me know in the comments section!

Signing Off

Posted 2 CommentsPosted in culture, faith, fun, mattresses

This will be my last post of 2018 and given the holiday I wanted to make it about something more than mattresses. The great thing about this blog for me personally is that I see it as a way to hopefully shine some light every now and then.

My wife just popped her head into my office as I type this and was pretty stressed out about going to the neighbors tonight and the food she has to make, last minute shopping, present wrapping etc. I have to admit that the pressure in my house for the holiday definitely falls on her and most moms/wives out there. So guys if this is true for you get in the game! Don’t just offer to help, just start doing stuff. But past that, I hope that everyone is able to think about what this time is really about.

For me it’s about my God who is so incredibly good he sent his son down to earth to show us what living a good life is supposed to look like all the while knowing that His life would end in the most tragic of ways. It’s about a lady named Mary that conceived a child as a virgin and a guy named Joseph who was dating her at the time and had to deal with how that looked but hung in there despite how tough it had to be. “So what you’re saying is that you didn’t sleep around on me but still got pregnant and you want me to marry you and be the father. Hmmmmm.” If you don’t buy into any of this I hope you connect with something of deeper meaning over the holiday in your own way.

If you are not in the Christmas spirit yet I have the perfect way for you to get that going. Make this year about other people and see what happens. Give some time to those that need some help or reach out to someone that you know might be hurting and just be there for them. Throw in a little holiday music, maybe Hallelujah from Pentatonix, and you are there.

For anyone out there that lost someone this year or is missing someone for whatever reason I am thinking about you and praying for you every day. If the holidays are tough on you for other reasons, the same goes, you are not alone I’m thinking about you also.

From my family to yours have a great holiday and enjoy each other!

BONUS:

If you have a lot of family and are not going to be together this year, try this game/app called Psych! You can play together no matter where you are…it’s loads of fun and very competitive so have a blast. In the past I make a strong push to have people stay off of their phones but we can make an exception in this case. Give it a try!