In a dramatic turnaround, the bedding industry — which was reeling in the early days of the COVID-19 pandemic — now finds itself strongly positioned for long-term success. And, interestingly, some of that positioning is due to the ways that the pandemic has changed the industry.

Scott Thompson, CEO of Tempur Sealy International, provided a compelling overview of bedding’s strong prospects on TSI’s recent third quarter earnings call, on which the company announced a robust 38% increase in year-over-year sales performance for the third quarter.

Thompson acknowledged that 2020 “is going to go down as one of the strangest years in most of our lives” and said the pandemic has led to profound consumer changes that benefit the industry.

“Today,” he said, “the industry and specifically, Tempur Sealy, are squarely in the middle of people rethinking their priorities in life.”

Two of the impacts of the pandemic have been an increased focus on health and wellness at a time when consumers are spending more time at home.

“We believe this focus on health, wellness and quality of life is going to remain a priority for consumers in the future and that our products will continue to resonate with those seeking quality sleep as part of their overall wellness plan,” Thompson said. “COVID-19 has caused so many disruptions and noise in our day-to-day lives, but sometimes it’s hard to see some shifts in the market.”

Among the major shifts, Thompson said the domestic bedding industry “is in the healthiest position I’ve seen. It is now structured for sustained profitable growth. The days of uneconomical retail store expansion are behind us. The number of retail doors has been rationalized, improving average sales and profit per store.”

He said “the days of significant unfair dumping of overseas product in the market are also behind the industry. We expect new antidumping actions to reduce the number of mattresses coming in from overseas and benefiting domestic manufacturers.”

He added that “the days of new start-ups focused on uneconomical land grabs have been mitigated, and their strategies have moved to becoming profitable entities.”

At the same time, Thompson continued, “legacy retailers and manufacturers have become skilled in producing profitable Internet sales. These dynamics, in addition to worldwide consumers focused on the category, provide an attractive backdrop for our business.”

TSI has also been helping itself with smart moves, according to Thompson, who said the company entered the year “in the strongest competitive position in our history,” having made significant investments in its brands, products, people and manufacturing operations.

He said that TSI is benefiting from the current market trends, but noted that the lion’s share of its performance is driven by its market position, investments in its business, and its long-term strategies.

Consumers today are looking for brands that offer an integrated omnichannel presence, Thompson said, adding that TSI has had a long-term focus on optimizing its “powerful” omnichannel platforms.

Those include a broad dedicated network of third-party retailers and the company’s own vibrant direct-to-consumer channel.

He recalled Tempur-Pedic’s long history in the DTC arena, noting that Tempur-Pedic “was the original direct-to-consumer bedding company.” That expertise will help the company as consumers continue to “lean in” to digital channels, Thompson said.

Those are great points. The market is changing, and those changes offer advantages to the bedding industry.

The post Blog: Thompson says industry benefits as consumers rethink priorities appeared first on Furniture Today.

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