As editor-in-chief of Bedding News Now, I talk to a lot of retailers and manufacturers about a variety of different issues.
And sometimes, the answers they have don’t match up, which is what happened recently when I wrote an article about bedding manufacturers who encourage retailers to upsell and sell higher-priced products.
They aren’t wrong, and their advice makes sense. Most retailers would likely rather sell one $8,000 bed as opposed to three $3,000 beds — one delivery and bill versus three.
However, a majority of mattress retailers I spoke with said most of their sales come from mattresses $1,000 or under.
So where is the disconnect?
Jeff Giagnocavo owner of Gardner’s Mattress and More in Lancaster, Pennsylvania, agrees with the conventional wisdom that it’s wise to increase every single ticket you can with added value.
“But what statements like that don’t address is, how is the retailer meeting the customer?” he explains. “What’s the value the retailer has in the marketplace? And how are they communicating their value proposition?’
That goes for the manufacturer, too, he adds, because “most all retailers and manufacturers compete on price.”
He says one of his biggest frustrations with the industry is when retailers lament about customers wanting cheap products but they have sub-par or misleading advertising efforts.
“Look at your advertising and look at the broader advertising in our industry,” he explains. “So much of it is focused on prices below $799. When you look at the real estate of advertising, like a newspaper article or a 30-second TV commercial, 50% of that space is advertising $799 or less. So our industry creates this divide right away between us and the customer.”
In the end, this all adds up to a customer who is unsure why anyone would pay $1,500 for a mattress when they know the ads said there are $799 options.
“And if you tell the RSA to start at the top and work down and they offer John Smith a $6,000 mattress — which is four times his budget — he’s not going to like that,” he says. “Our industry pays lip service to selling better sleep, but very few dig into actually selling the sleep conversation, and that’s where you increase tickets. Until you commit to that fully, this is a circular conversation that will continue forever and ever.”
Gianicavo also says that this is indicative of a bigger problem in the industry, which is that many retailers still aren’t focusing on selling the entire sleep system in a meaningful way.
“They may carve out ad space to talk about sleep, or write blogs or social media posts around it, but when the rubber meets the road, what does the sales process look like?” he asks.
As for manufacturers offering upselling advice, Gianicavo says that if they’ve never been in a retail environment actually selling to a customer, retailers should take their advice as only one part of the broader conversation.
“More novice retailers really do look up to their vendor partners and lean on that partnership,” he says. “I think every factory should have a retail selling expert.”
Breaking the vicious cycle
Chris Taheny, senior vice president of sales at Dreamfit, responded to my question with useful data about accessory sales that the whole industry can learn from.
He presented this data to his sales team and they found that accessories are an important investment for retailers and can bring in major profits. But retailers often treat them as an afterthought.
Taheny explains that in 2021, everybody was shooting fish in a barrel because they knew the demand was high. Because of that, many didn’t track their sheet, protector and pillow sales, and that’s now causing issues.
Recently, the International Sleep Products Association announced in its latest sales report for members that sales of mattresses and foundations dropped double digits in both dollars and units sold in 2022. Year-to-date sales dropped 12% to $9.96 billion from $11.3 billion in 2021, and units sold dropped 17.9% to 42 million from 51 million.
“Retailers who used to see 10 people a day are now seeing five people and need to figure out how to offset the difference,” Taheny says. “So why not focus on something that in its own right could potentially create repeat customers who refer others to your store? Many retailers don’t put into service behind these categories. There’s no training and development, there’s no ‘wow’ factor.”
And this isn’t an ad for Dreamfit. Taheny says he believes all accessories are useful in raising sales numbers.
“Our business is very cyclical,” he explains. “And that’s what breaking the vicious cycle is all about. They’re so happy that they’re hitting the kind of numbers that they want to see that they don’t think about accessories, and many retailers aren’t even making low-end sales right now. There is a way for them to turn this around.”