A furniture store problem: Bedding’s price erosion
A few weeks ago we talked in this space about bedding's ultra-powerful presence on furniture store floors. We noted that bedding gives furniture stores far more in sales than it commands in selling space, a performance no other product category can command.
This week we share one of the less positive findings about bedding's performance in furniture stores. Like those glowing findings we shared a few weeks ago, the more sobering bedding news comes from Furniture/Today's 2013 Furniture Store Performance Report.
The bad news, in a nutshell, is that furniture retailers are shifting down to lower-priced bedding models. A year ago, the median for the best-selling bedding price point in queen was $899. But this year, our Furniture Store Performance Report found, that best-selling median has dropped to $799. That's an 11.1% decline. And that most probably means declines in overall bedding volumes and, even worse, declines in profitability. Bedding, as we all know, is a profit engine.
Now we do need to put bedding's decline in context. It wasn't the only category to head south in furniture stores this year. The median for the best-selling price for leather motion sofas dropped from $1,399 last year to $1,299 this year, a 7.1% decline. For leather recliners, it dropped from $799 last year to $699 this year, a 12.5% decline.
Wood furniture also took some hits. The median for the best-selling price point for a formal dining group, with table and six chairs, dropped from $1,899 to $1,699, a 10.5% decline. And it dropped from $599 for desks to $499, a 16.7% decline.
Most other categories maintained their price points from last year to this year. Entertainment centers managed to show the biggest gains; the median for the best-selling price point rose from $599 to $699. Ah, the power of TVs and home entertainment systems.
What all this adds up to, in the furniture store universe, is that 2013 was a challenging year for furniture stores. We know the usual suspects: A shaky economy, tough competition, and lackluster consumers. But we also know that bedding should be strong enough, of all the product categories on furniture store floors, to shake out of those doldrums.
Want to sell more high-end beds? Show more high-end beds. Add more hybrids to your sales floor. Forget about the silly debate about what constitutes a hybrid. Whatever you call them, they are selling. Ashley is touting its hybrid models. So is Sealy. Get on the hybrid bandwagon.
Also, we strongly recommend you get out of the crazy business of promoting low-ball sleep sets. The consumer who comes in looking for a $299 sleep set has to jump up $500 just to hit that $799 price point that is the sweet spot these days.
And talk about new technology. Hybrids offer a nice blend of technologies. The gel story resonates with consumers. New innerspring designs add new feels. Most important, explain how the technology delivers a better night of sleep.
We cannot accept bedding's sales dropoff at furniture stores lying down. Furniture stores can do better. Let's hope they fight to restore more bedding sales at higher price points.