Leaders in the mattress industry share their perspectives on the state of the sleep products business and discuss ways to address changing market forces.
With 2017 speeding to a close and a new year upon us, BedTimes talked to a half-dozen leaders in the mattress industry to get their assessment of the state of the bedding business, nationwide economic conditions and key trends that will shape how their companies operate in 2018.
There is broad agreement that the industry is in a period of transformation, driven largely by changing consumer shopping habits and new online players that blur the line between manufacturer and retailer. But other factors, including the growing spending power of millennials, are driving change, too. It is, many say, a challenging but exciting time.
We’re sharing some of their answers, in their own words. (Some comments have been lightly edited for clarity and length.)
1. As we wrap up 2017, how would you complete this sentence: “The current state of the mattress industry is_______.”
“In flux. Change is the new norm.”
—Bryan Smith, president of Nashville, Tennessee-based mattress producer Southerland Inc. and chair of the International Sleep Products Association’s Board of Trustees
“The bedding industry is stable and expected to grow slightly this year.”
—Michael Traub, chief executive officer of Atlanta-based mattress major Serta Simmons Bedding LLC
“We are in the midst of very exciting times. The industry is going through many changes. Consumers are becoming increasingly aware of alternate channels to purchase and the distinction between mattress retailer and manufacturer is becoming less defined.”
—Eric Rhea, vice president of the bedding group at Leggett & Platt Inc., an industry supplier based in Carthage, Missouri, and vice chair of the ISPA Board of Trustees
“Evolving and changing to meet the needs of consumers from multiple generations who are shopping for a great night’s sleep both online and in a retail store environment.”
—Kim Grubb, vice president of sales for industry supplier Wright Global Graphics, which has headquarters in Thomasville, North Carolina
2. As we head into 2018, what are the biggest strengths and weaknesses of the U.S. economy?
“The strength will be the millennial consumer segment. As the millennials get older, they will continue to progress in their careers, increasing their disposable income to spend on purchases like mattresses, furniture, refrigerators and other appliances. That consumer group is going to be a big factor in the growth of the economy. However, even as they are one of our focuses, we do have to pay attention to other emerging age groups, as well as the over-40 crowd. The weakness is that there remain rumors that the U.S. economy is still in a recession. Whether true or not, all of the chatter about a recession tends to make people pull back on spending.”
— Nick Bates, president of Boston-based licensing group Spring Air International
“(Though tragic for those affected,) the mattress industry will be favorably impacted by the recent natural disasters. Hurricane damage in Florida and Texas and fires in California have created more demand as communities rebuild.”
— Mark Jones, president and chief executive officer of industry supplier HSM in Hickory, North Carolina
“Most economic indicators remain strong. Consumer confidence is good, housing sales/moves are strong and gas remains reasonably priced. While we have not experienced strong sales in 2017, we expect the industry to pick up steam in the late fourth quarter and carry into 2018. The biggest weakness appears to be the political disruption. Unfortunately, this is a wild card.”
“We’ll continue to see the reverberations of economic and geopolitical factors, global trade uncertainties, and strong consumer demand from 2017 carry over into 2018.”
3. What is the biggest challenge facing the mattress industry as a whole? How can the industry best respond?
“Ultimately, we are competing for consumer dollars. The amount of money people spend on portable electronics is growing significantly faster than their investment in sleep products. Retailers, manufacturers and suppliers must join together to remind consumers that better quality sleep equates to a higher quality of life.”
“Creating door swings at retail. Getting consumers into retail stores instead of buying online is the greatest challenge. At the end of the day, we need folks who preshop online to come visit the store to ensure our retailers are successful. To get them there, retailers and wholesalers need to partner together to run in-store programs, whether it’s a special purchase, promotion or something else that has a social benefit. In-store events and charitable events give retailers a presence within their local communities and tend to pull consumers into the store. Once they’re inside, they tend to be more likely to return and buy.”
—Bates, Spring Air
“Employment. Whether it is factory employees or retail sales associates, all remain difficult to find and retain. I wish I knew the best response. We continue to try to find ways to attract employees for our factory and ways to make our products simple to sell at retail.”
“The compressible bed business is seeing its own internal explosion of competition with more than 150-plus companies now offering compressible beds online. With all the options, both online and in-store, retailers are making a clear choice to bring compressible mattresses into their stores in hopes that they will drive foot traffic and give the consumer an option to ‘try before you buy’ in-store and still walk away with a mattress in a box or have a mattress delivered to the home. The mix of online mattresses and traditional mattresses on the retail floor will certainly change the landscape of product offerings by the retailer.”