Might higher furniture prices actually be a plus?
Furniture Sketchbook column
David Perry -- Furniture Today, November 15, 2005
It’s time for another session of Marketing 101. This week’s case study: Are higher prices for upholstery and bedding good for our industry?
My short answer: Yes.
I know that probably comes as shocking news to many of you in our price-crazy industry. But wouldn’t it be nice if we could get away from some of the sacred cows in our merchandising mantra? Must we always have $99 sacred cow mattresses and $399 sacred cow sofas?
Well, we have always said that we must have those types of sacred cows, so we keep searching the pasture to find suitable examples. But now, with foam prices shooting upward, that could finally be changing. Or could it?
During the recent High Point market, we heard the first cries of angst from retailers unhappy about the prospect of higher prices for upholstery and bedding. Some were predicting that those sharply priced items we like to promote in our retail advertising will become extinct. But others weren’t so sure.
Frankly, I’m not convinced the $399 sofa will disappear. I think it will be “redefined,” which means it will be re-merchandised, which means, in this case, that it will be “cheapened.” I hope that doesn’t sound too unappetizing.
Do we really need to keep going down this road? Why can’t we as an industry raise our selling prices? Sure, those promotional hot button prices have helped us move a lot of merchandise. But what have we sacrificed to keep the prices ridiculously low?
It would be refreshing if we had the confidence to tell consumers that last year’s $399 sofa is now a $449 sofa, or that the $299 mattress is now $349. There are reasons why prices are going up. They are called hurricanes, and they played havoc with petrochemical plants on the Gulf Coast. (Note: Some say the higher prices are driven, in part, by suppliers looking to boost their margins.We won’t get into that issue in this column.)
It’s our job as an industry to give consumers compelling reasons to pay more for their sofas and mattresses than they might have set aside for those purchases. We must provide the additional features and benefits that make consumers feel good about opening their wallets and buying higher quality products.
With foam prices rising, producers will be finding creative ways to hit those popular starting price points. If consumers don’t find as much value at those price points, dare we hope that they might trade up to higher prices?
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