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Presidential election year study says modest unit gains likely

David Perry -- Furniture Today, December 19, 2011

David PerryWith the next U.S. presidential election less than a year away, it's a good time to examine presidential politics and their effect on the mattress industry. It turns out that there is a bit of a presidential bedding bounce, but it's not where you might expect to find it.
     The lift, as I discovered after spending some time crunching numbers in the archives of the International Sleep Products Assn., comes in the years before the presidential election. Did you know that?
     I looked back at the last seven presidential election years, and the years that preceded those elections. I found that bedding business in those seven pre-presidential election years, starting in 1983, was stronger than bedding's performance in the seven election years that followed. The average unit and dollar gains were larger in those pre-presidential years than in the years that followed them.
     But I do need to add a major qualifier: The recession year of 2008, a presidential election year, wiped out sizable bedding gains in other presidential election years, pulling the average figures down for the presidential years. But we won't let that inconvenient fact ruin our analysis.
     Here are the figures that form the basis of our calculations. In the pre-presidential election years of 1983, 1987, 1991, 1995, 1999, 2003 and 2007, the industry posted unit gains of 13.9%, 6.3%, 0.6%, 0.4%, 5.6%, 2.4% and minus 2.1%, respectively, with dollar gains of 16.4%, 8.6%, 2.7%, 5.4%, 8.8%, 7.8% and 1.4%.
     In the presidential election years of 1984, 1988, 1992, 1996, 2000, 2004 and 2008, units were up 6.3%, 2.8%, 5.1%, 3.7%, 2.2%, 3.2% and down 11.0%, respectively. Dollar gains were 6.7%, 7.9% 7.6%, 5.2%, 5.4%, 12.1% and minus 9.1%, respectively.
     Here's how all of those gains (and losses) average out: In a presidential election year, units are up 1.8% and dollars are up 5.1%. But in a pre-presidential election year, units averaged a 3.9% increase, with dollars up 7.3%.
     So there you have it. Mattress history, as written from 1983 onward, tells us that this year will be a slightly stronger year than next year. That same history tells us to look for modest unit gains and stronger dollar gains this year and next, so that's an encouraging sign.
     Sure, I can give you several reasons why the political and economic climate today is vastly different from the realities of 20 years ago, but the numbers in this little exercise are suggestive, I think.
     Or do you want to argue with history?

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Presidential election year study says modest unit gains likely

Dec 22, 2011

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