May 18, 2016
The mattress industry is sloshing around with the anxious sweat of fear. The uncertainty is focused on the continuing surge of ecommerce mattress brands. The industry labels this whole category as “BIBs”—short for bed-in-a-box. They seem to be missing the point, though.
The echo chamber within the mattress industry is amusing to say the least. In one session, a brick & mortar retailer presented a scanned photo of a 100-year-old newspaper ad for a mail-order mattress. This cheerleading executive was so proud to deny the digital threat, and rallied the other grey-haired suits in the ballroom. “There’s nothing to fear here, bed-in-a-box is nothing new! This fad will pass just like it did 100 years ago.”
This presenter was at least correct that bed-in-a-box is not the key innovation here. Starting in 2012, Tuft & Needle catalyzed this wave of change in the industry, but we did not invent “bed in a box”. There is literally a company named “BedinaBox.com” that started nearly a decade before we did. Tuft & Needle disrupted—and is continuing to disrupt—by completely flipping the status quo of the mattress shopping experience on its head. Packaging our mattress in a small box was merely a part of the larger play, to ship to our customers faster and more cost-effectively.
There is so much money at stake in this $16 billion industry. With each passing hour, customers are slipping out of the incumbents’ fingers like grains of sand. While that’s happening, instead of evolving, what they are doing is telling each other what they want to hear. These are textbook examples of confirmation bias, circejerk and other logical fallacies.
On the ecommerce panel where JT and I were invited to speak, we shared candidly with these mattress executives that brick & mortar retail in the traditional sense is dying, and in some sense it is already dead in spirit. A depressed silence followed. The rippling effects are significant in an industry where most of the investments have been made and infrastructure has been built around an aged, now-defunct model of brick & mortar.
Feeling fear and anxiety is a perfectly healthy and natural instinct. What is important is how you react to that feeling. Frozen and paralyzed, do you cope by convincing yourself it’ll be okay? Just sit tight and the storm will pass. Or do you make big moves, even through very painful changes that tear at the fundamentals of your business, to adapt and play the new game with new rules?
The industry gorillas Mattress Firm and Tempur-Sealy have placed themselves in an awkward position by launching their own bed-in-a-box brands called DreamBed and Cocoon. Are they using their billions to innovate and slingshot ahead of us? I don’t think so, but let’s see how this goes.