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3 Reasons to Believe in a BIG 2012

After Las Vegas, we are coming out of what I would call one of the most exciting markets ever for the mattress industry. Many of the bedding producers out there brought new product lines to market, fresh new marketing ideas, and the attitude that they were going to make something happen this year. Well, most of them anyway. Attitude is great, but will the stars line up to deliver a strong 2012? This is all dependent on a questionable macroeconomic condition, uncertainty on the political front, and oil prices that are creeping higher and higher, not to mention the conflict going on with Iran, which isn’t going to help anything.

Here are three key points that might help put all these concerns to rest:

1.    A BIG start
ISPA just released the January 2012 numbers and they were HUGE. As a matter of fact, I don’t remember seeing the numbers that good during my career. You have to love seeing an 18.5% increase in units and a 29% increase in dollars. Many are quick to point out that the companies reporting in this survey only represent roughly 65% of the units out there, and that the other producers are not that strong in the specialty space where a lot of this growth came from. This is still good news, even with that in mind. Momentum is a great thing, and this could be just what we need to get us started.

2. BIG advertising
The top four bedding producers are all claiming increases in their ad spending. Simmons came out saying that it was going to invest $15 million over a five-month period outside of its co-op dollars. Serta and Sealy said they were going to increase spending outside of the co-op model and Tempur-Pedic is going to grow its marketing voice past the $100 million mark and heavy up during key holidays. I can’t remember a time when the industry was this aggressive, and that is going to make a lot of consumers out there aware of what we are doing. If the retailers follow suit and tag on to the bedding producers efforts, it could mean great things for the industry.

3. BIG Competition
Competition in this category is without a doubt heating up. You have significant growth and consolidation happening with the two 800 lb. gorillas (and I mean gorilla in the nicest way): Sleepy’s and Mattress Firm. They are not really competing in each other’s markets yet, but I would imagine it is only a matter of time given the aggressive nature of both groups. You also have the bedding producers that are very aware of what it is going to take to gain market share in 2012 (as noted above). Thanks to Tempur-Pedic, there is a new normal in terms of how you tell your story. The other manufacturers are paying attention and reacting in a big way. These guys don’t want to get left behind, and if they are going to compete, they are going to have to step up their game.

One thing seems clear to me: If you want to gain market share this year, you are going to have to make a significant investment in your business. The good news is that if we can leverage a great start, this year could be just what we need. Maybe there is something to all of that talk about pent up demand? What do you think? Could we see better results than are being forecasted? Tell me your thoughts in the comments section.

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.

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