For those who follow the industry closely, the news of May 23, 2012 marked an historic turning point among mattress makers. That news? Serta has unseated Sealy as the leading mattress maker by sales. And not by a small margin either… by more than $34 million in sales in a period where Serta’s sales are increasing and Sealy’s are dropping. If this combination of events does not instill fear in Sealy, it should. And not not just because Serta has successfully threatened Sealy’s leadership position, but because Simmons Mattresses (currently the number 3 mattress maker) is making aggressive strides toward that Number 2 position.
Sealy – Is It Game Over?
Regular site visitors understand that we are strong supporters of Sealy Mattresses, whether those products are its luxury-market leader, Stearns & Foster mattresses or the strong performing Posturepedic line. In fact, the name “Sealy Posturepedic” is the most-recognized coil mattress name on the market. It’s Titanium coil system and the variety of offerings make Sealy the most well-diversified mattress maker out there. But even with such assets on its side, Sealy continues to lose ground. It doesn’t make sense on paper…
As a publicly traded company, investors should call for change. Although Larry Rogers, Sealy’s CEO, remains confident about his company’s ability to reclaim the Number 1 position, claiming his company has a solid pipeline the odds are clearly stacked against him. Those products, including a gel bed and improved Stearns & Foster offerings, need more than an angioplasty to flow through to the market; they need to be pumped up with adrenaline and they better keep the AED nearby. Rogers needs to be worried indeed, and not just about his job; he needs to be worried about the company (it currently owes more in liabilities than it owns in assets). A good place to start would be with tomorrow’s Mattress Expert post and making things right by Randy with his Posturepedic Grayson mattress.
Simmons Gaining Ground
Regular site visitors will also confirm our bias toward Simmons mattresses; its Beautyrest line impresses time and again. There is nothing fancy about its mattress core – no Titanium, no issues with gel or memory foam, no gimmicks. And this has paid dividends to Simmons. As the company flirts with the $1 Billion in sales benchmark after posting double-digit gains in sales, it clearly has Sealy in its cross-hairs. Within two years, Simmons may very well overtake Sealy and for good reason – solid, proven product that ranks well according to the owners and experts alike, the these mattresses are undoubted. (According to industry trade publication, Furniture Today, Simmons once owned the top spot anyway; it would not be a new position for it to hold).
Serta Riding The Gel Bed Gravy Train
In the past, we have commented about the incredible success of the Serta iComfort gel bed. Serta, which was the first commercial mattress maker to the gel bed market, literally nailed it with a product that exceeds consumer and expert expectation. Although gel beds are really just enhanced memory foam products with improved heat dissipation qualities (compared to memory foam) and better comfort qualities (compared to latex), Serta’s early entry in the market has allowed it to post huge sales gains as a result. The success of iComfort has also upset TempurPedic’s position… so much so that TempurPedic has launched its first-ever sales campaign.
Will Serta remain in the top spot? We suspect that it will. It’s coil products are solid and its celebrity endorsed lines remain popular with consumers (albeit controversial among industry pros). And, of course, the iComfort product is showing no signs of easing up, allowing the company to refocus on enhancing its other lines. This spells bad news for Sealy… really bad news.