Tempur-Pedic has been great for the mattress industry. I’m a big fan in many ways. By targeting consumers, the company has grown awareness in the importance of a good mattress and single-handedly raised the average unit selling price for ALL of us in this crazy business. I have a profound respect for its marketing approach. Tempur’s team has built a truly compelling brand. All of this is coming from an innerspring guy, by the way!
In addition, I really like Rick Anderson, the company’s president of North America, and have made friends with several people on that team. When you stir in that my sister works for Tempur-Pedic, I really respect the group.
HOWEVER (you knew this was coming), I want to open up a conversation. As I predicted in a previous post, Tempur-Pedic announced a lower-priced product at Las Vegas Market. One that brings them down to the $1,499 price point and drastically expands the potential customer base. One thing I know about Rick Anderson and his team is that they do their homework. There is no doubt in my mind they looked at this from all sides, but research only tells you so much. Consider the following:
- Based on feedback I got from several at Market, the plush version bottoms out when you sit on it.
- The visual appeal is not impressive.
- Tempur-Pedic is not the only company bringing a message to the consumer this year.
- The products have lower retail margins.
- Consider the impact RSAs will have. DO NOT UNDERESTIMATE THE SLEEP GEEK!
In the past, when Serta, Sealy, or Simmons introduced a specialty line, all three fell short on the marketing side of the launch. An “S” brand product, at the same price or lower, could sit across the aisle from Tempur-Pedic and Tempur would win the battle. Today, things are changing. Consider that in 2011, Serta had a strong intro with iComfort, told a great story to the consumer, and drove some interest. If you put a Tempur-Pedic priced at $1,499 across the aisle against a Serta iComfort that looks better, and maybe even feels better, who is going to win?
It’s easy when you’re re-merchandising a line to build in a price increase, or tweak products to fit the ever-changing market. Tempur-Pedic is attempting to plug a lower-priced product in to an existing assortment, which is much harder. The Tempur team is trying to come down-market, so they needed to make sure the new Simplicity did not look better than the one above it. Here’s Tempur-Pedic’s potential miss: You have to consider what the competition is doing. In the past, that didn’t really matter (as we have all seen), but I think the bedding world has changed.
What do you think? Is the Tempur-Pedic brand so strong that it can overcome the challenges I pointed out? Will the company be successful with “bridge” products and will those new offerings allow more people to afford buying the brand promise that is Tempur-Pedic?
Stay tuned, only time will tell.
DISCLAIMER: The views and opinions expressed in this blog are mine and mine alone. They do not represent the thinking of the company I work for, or anyone else with whom I am affiliated. Except my wife of course, who is good at telling me what not to say.