Online mattress brands are once again betting on physical retail
After a few years of reset, online mattress players are continuing to bet on physical retail stores.
Naturepedic, which opened its first store in 2014, doubled its retail footprint in 2023, opened six new locations in 2024 and is on track to open about 10 locations in the U.S. in 2025. Meanwhile, Casper, which opened its first store in 2018, kicked off this year with a new store design with a lab for pillows and a “Snooze Bar” akin to Apple’s “Genius Bar.” And Saatva, which opened its first showroom in 2019, now has 20 locations across the country and is targeting eight to 10 new showrooms a year over the next four to five years. It’s also using its showrooms as customer service centers.
For years, mattress companies mostly sold wholesale through partners like Mattress Firm, Sit ‘n Sleep and Raymour & Flanigan. Over the last 10 years, however, there was a spike in online “bed-in-a-box” startups shipping mattresses straight to customers’ doors. The online model became very popular — in 2018, there were some 178 different online mattress brands, according to Fast Company.
But as with all business bubbles, there eventually came a period when these brands’ e-commerce growth plateaued. Casper, for example, launched in 2010 and grew for years but then saw sales slow down; it went public in 2020 for half its previous valuation. In 2021, Casper went private, and it changed hands once again earlier this month.
Now, with so much turnover in the space, some early online mattress players are opening more of their own stores to appeal to shoppers who want to touch and feel products in person. Several told Modern Retail their businesses have improved as a result.
For example, Naturepedic, which started as an online business in 2003, finds that its overall sales in an area with a store increase between 10% to 15%, Arin Schultz, vice president of sales and marketing, told Modern Retail. Even though most of Naturepedic’s customers buy online, around 53% prefer to start their shopping in person, Schultz said. Being able to touch and feel mattresses “gives them a level of comfort,” he explained. Customers get a better sense of the product in-store, which is why Naturepedic sees its return rate drop as it opens more locations.
Saatva operates physical locations differently than some other mattress stores. Saatva only sells products online, so its locations — which it calls “viewing rooms” — act more as showrooms for people to test out the products. The viewing rooms allow customers to try out different options, as well as consult in-person “sleep guides” who function as customer service representatives.
Chad Lundeen, who joined Saatva in 2021 to oversee its physical retail plans, told Modern Retail that viewer rooms “have contributed an 18% increase in the DMA [designated marketing area] within a very short period of time.”
“If you put a new store in here and match it against a location of similar demographics with no store, we see a very quick spike in overall DMA, where the non-VR location stays pretty flat,” said Lundeen. “This is really driving our revenue growth.” The brand’s revenue is up 15% to 18% year over year, according to Lundeen.
Because mattress brands like Saatva started online, they can use e-commerce sales to figure out where to put their next stores. But it’s important to be slow and steady with expansion, executives told Modern Retail. Naturepedic, for instance, initially hoped to have 40 stores by the end of 2024 but is ending the year with around 30 because it wants to make sure it’s picking neighborhoods that make sense, Schultz said. In fact, Naturepedic moved its Los Angeles location to a different part of the city this year to have access to more parking spots.
“We’re not trying to be the Starbucks of mattresses,” Schultz said. “We’re never going to be one of those chains with 1,000-plus stores. We’re just hoping that our existing stores and the stores… that we’re looking to open up get that much busier… And if [an area] doesn’t meet our criteria, we’re just not going to open up a shop [there], because we want to set ourselves up for success.”
This comes as some legacy mattress retailers continue to report growing sales. Mattress Firm, for instance, recently reported a 71.2% rise in quarterly net income from a year prior. However, this summer, the Federal Trade Commission moved to block efforts by Tempur Sealy International to buy Mattress Firm for $4 billion, saying the combined company would have “enormous power at multiple parts of the mattress supply chain.” Temper Sealy is seeking an injunction against the proceeding.
Today, online mattress players are opening locations in many types of locations, from neighborhood shopping streets to large-scale shopping centers. Purple, which launched as an online-only mattress brand via a Kickstarter campaign in 2015, currently operates dozens of owned stores, including one in The Mall in Short Hills, New Jersey, and one in Santa Monica Place in California. Avocado, which launched in 2016, now has 15 owned locations in cities such as Seattle, Scottsdale and New York City.
Stores can be extremely beneficial for digital-only brands, said Alec Zaballero, managing executive at the design firm TPG Architecture, which has designed stores for digitally-native companies like Boll & Branch. “When a digital brand puts a physical store into a zip code, they see a double-digit increase in their online business from that zip code,” he told Modern Retail.
But creating an effective store requires time, care and consistency, Zaballero emphasized. The way that customers experience a brand in person and online needs to be “very closely aligned,” he said. “It’s not just a question of, ‘Use the same fonts and colors,'” he explained. “It’s a question of saying, ‘The online experience is a legitimate retail experience, and we have to extend that relationship in the physical space. We can’t contradict the way that you shop online in the physical space.'”