Comfort Solutions drops MAP
David Perry -- Furniture Today, January 7, 2013
WILLOWBROOK, Ill. - Bedding producer Comfort Solutions is saying no to minimum advertised pricing and saying yes to retailers who want more control over their bedding business.
"We believe retailers will return to being merchants," said Dave Roberts, the longtime president of Comfort Solutions, the No. 7 bedding producer.
He says his company is giving retailers plenty of tools to do just that, ranging from a wide portfolio of highly differentiated bedding lines to retail selling programs and traffic-building promotions. And Comfort Solutions is also giving retailers something many bedding majors don't: the ability to set their own advertised prices.
Under minimum advertised price, or MAP, programs, manufacturers set the lowest prices at which products can be advertised. Those programs are proliferating, Roberts said, and now may apply to about 40% of all bedding retail sales.
Comfort Solutions' Sleep Doctor Michael Breus mattresses had been a MAP line, but the company has eliminated that requirement and now has no MAP products.
"Manufacturers should not dictate the value and have control of prices," he said. "Manufacturers should be manufacturers and retailers should be retailers."
Comfort Solutions has "come to the conclusion that retailers are a better judge of the value of products than manufacturers," Roberts said.
Retailers' bedding needs vary widely around the country, he said. What a retailer needs to be successful in New York City will differ from what a retailer needs in Omaha, Neb.
Comfort Solutions works with its retailers to meet their specific needs, he said. "Why do we deserve to exist?" he asked. "We offer a strong alternative to what is being offered in the market."
The producer believes in giving retailers a variety of margin-building bedding brands for them to merchandise on their sales floors, according to Roberts. Last year, for example, the company initiated a new bedding program with Sleep Doctor Michael Breus, introduced its gel memory foam line, iMattress, brought out its Natural Response specialty line, and exhibited a luxury bedding line, Grand Reve.
Those introductions joined existing brands like Laura Ashley, King Koil and Extended Life, billed as "the no sag mattress."
The producer even borrowed a cue from the auto industry, introducing its bedding offerings at a lavish Las Vegas party that spotlighted each new collection.
"We are looking at the industry differently," Roberts said. "We are not doing things with blinders on."
Comfort Solutions re-branded itself last year, adopting a new tag line, "Never stop dreaming." The company also announced a 2012-2013 partnership with St. Jude Children's Research Hospital, with a $1 million fundraising goal.
Later this month, Comfort Solutions will bring a full plate of new and redesigned bedding lines to the Las Vegas Market, which runs Jan. 28-Feb. 1, and will also unveil what Roberts describes as a "revolutionary" bedding innovation. The company isn't ready to release details yet.
Roberts said Comfort Solutions had another strong performance in 2012, with the most recent reports reflecting about a 16% sales gain. He said three relatively new Comfort Solutions licensees, in Texas, South Carolina and Ohio, all had "extremely good years" in 2012.
Driving much of the company's success last year was a strong showing by the iMattress line.
Roberts offered his analysis of the consolidation wave sweeping the industry. "It's safe to say the private equity firm that recently bought Simmons and Serta won't leave everything the same forever," he said. "You have to expect changes at those companies." One of those changes might be for Simmons and Serta to consolidate into one entity with two brands, he speculated.
Tempur-Pedic's proposed acquisition of Sealy "could be good for the industry" if it leads Sealy to boost its brand-building investments, he said. But he said "it is going to be tough" for Tempur-Pedic to regain the momentum it lost last year.
However the changes play out in the industry, Comfort Solutions sees growth possibilities for its group. "When manufacturers try to control brands, we have an enormous opportunity," Roberts said.