Luxury bedding gamble still paying off for Kittles
By Larry Thomas -- Furniture Today, February 3, 2002
INDIANAPOLIS — Way back in the mid-1990s, when mattress price points rarely topped $2,000, executives at Top 100 retailer Kittles decided they wanted to make a bold statement about high-end bedding.
Luxury bedding was still in its infancy in those days, and there were a fair number of skeptics who believed it was a passing fancy. But Kittles believed otherwise, and the Hoosier chain opted to devote more than half the floor space in its flagship store to mattresses whose price points exceeded $1,000 in queen.
This luxury bedding gallery, complete with oak paneled walls and plush carpeting, was probably the first of its kind. And it was practically an overnight success, as consumers cheerfully forked over $1,000 to $2,000 or more for a sleep set.
That convinced the retailer that luxury bedding wasn't a just a fading blip on the radar screen.
Today, such galleries are in place at five of Kittles' largest stores, with a sixth luxury department set to open this spring.
And the top price point has doubled from what it was in those early days. Senior buyer Bob Colin said most stores now have models priced at $3,999 in queen and noted that products at $1,000 to $2,000 have almost become the meat-and-potatoes of the luxury business, if there is such a thing.
"I'll take a $2,000 sale any day of the week," Colin quipped.
Colin said even though Kittles' overall bedding sales were down slightly in 2001, luxury bedding bucked the recession and recorded a sales increase. He said the retailer "had a huge increase" in sales of Kingsdown products but also did well with its other two upper-end lines, Stearns & Foster and Masterpiece.
He attributed the success of the Kingsdown line to the producer's Dormo Diagnostics program. Under this program, a computer selects a bed for the purchaser after he or she answers a series of questions about sleeping habits and lies on a computerized mattress that makes thousands of calculations based on body weight, size and the like.
"They make it very simple and credible to the consumer," Colin said of the Dormo program. "It has been tremendously successful."
But luxury bedding isn't the only bedding success story at Kittles. The retailer carries the nation's three best-known brands — Sealy, Serta and Simmons — in its non-luxury bedding department, and Colin said sales associates work hard every day to sell more than just an entry-level product at $299 or $399 in queen.
"In fact, $699 and $799 have become our power price points of late," he said. "If you can give the consumer a good value, she'll buy it. A good value doesn't necessarily mean something cheap."
Flexible ad strategy
Colin said the difficult 2001 sales environment forced Kittles to alter its advertising strategy slightly and run fewer stand-alone bedding ads. However, the retailer stuck to print advertising — its primary medium even in good times — because it is a proven winner.
"Bedding has its own (advertising) budget, and typically 90% of our bedding ads are stand-alone pieces. But last year, the number was more like 40%," he said. "When you're in a recession, you just have to do some things differently."
Kittles has long been noted for giving away premiums with the purchase of selected sleep sets, and Colin said that isn't likely to change. One of the company's most successful promotions in 2001 came during July, when consumers spending at least $499 on a flagship mattress set received a gift certificate for $20 worth of gasoline.
The give-away came at a time when gas prices topped $2 per gallon in Indianapolis and much of the Midwest.
"At that time, $20 wouldn't even fill up your tank … but it showed the consumer they are important to us," said Colin.
He said the markets in which Kittles competes are becoming heavily saturated with bedding retailers — the Indianapolis market alone now includes Mattress Gallery, Today's Bedroom One and fellow Top 100 member Mattress Firm. That has prompted the retailer to open additional Kittles Room Express locations in recent years.
These stores, while considerably smaller than full-line Kittles locations, have a large bedding lineup that is marketed as Mattress Express.
That program has allowed Kittles to stay competitive in the conventional bedding business, but the slew of other bedding retailers has kept the company out of the specialty bedding arena.
"I get a call a week telling me I should be in futons … but I look at where (the competition) is out there, and those guys would kill me," Colin said. "If I cannot be competitive, there's no sense in being in the business."
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| Kittles promotes bedding on its Web site, www.kittles.com. |
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