Is the Online Mattress Industry Failing? (2024 Update)

We receive free products to review and participate in affiliate programs. See our disclosure page for more information.

2020 was a challenging year for most businesses, but online businesses thrived. The mattress industry, predominantly a brick-and-mortar retail sector, has shown an increasing online presence since 2015. After the pandemic, the online mattress industry should have stayed stable, but there seems to be a downward trend.

Today(2023), more online mattress companies are closing down. Even with a low investment, high-profit business, it’s rare to see a company fail and file for bankruptcies. Some of these mattress companies have closed down permanently. Initially, it was thought that the effect was on the mattress industry overall and not just the online mattress companies. With news of Mattress Firm closing down more than 200 outlets and Serta Simmons filing for bankruptcy since 2021, it was indeed natural to believe that new companies were not going to survive the challenges in the industry.

This required us to evaluate the overall mattress market. To begin with, what was the reason, and where did it all start?

The mattress industry was expected to grow steadily, according to experts. Fortune Business Insights stated that the $52.45 billion market in 2023 would grow to a $73.34 billion industry by 2030 at a 5.9% growth rate per year. The Grand View Research website puts the mattress industry to be around $39.4 billion in 2021 and a growth of 6.2% by 2030. The general consensus is that the mattress industry is growing steadily. But then why are companies, new and old, closing down or filing for bankruptcies?

With The Losses in the Brick-and-Mortar Mattress Retail Stores There is a consensus that a big chunk of store businesses took a hit with more online mattresses. Research shows that 66% of sales from the top Mattress companies came from online business in 2021. This may seem like a big number, but the growth rate in 2020 was 47%, as opposed to 24% in 2021. The mattress companies online are growing, and this, in turn, should reduce the sales in retail stores in the USA. That does not seem to be the case. The mattress companies that closed down in 2022 were in direct relation to the loss they had to incur during the pandemic. With the pandemic now over, more people still purchase mattresses from retail stores, putting a small dent in the online mattress growth.

Things don’t end here either. With fewer stores and less investment, coupled with steady growth in the retail business (offline), many mattress companies are regaining normalcy and are able to make a decent profit again. While some are still struggling, others are already on an upward trend.

The Problem with Online Mattress Companies With the pandemic and the boom of online business, a few companies did manage to make a good online presence and make a good business during the time. While some companies did survive post-pandemic, others simply did not see the same growth rate, and some even failed. Online mattress companies are relatively easy to set up. They require lower investment and have a higher profit margin. Most companies even have arrangements with manufacturers to avoid stocking.

Many users prefer to purchase a mattress from a physical store, and this is a drawback for most online mattress companies. They tackled this with a longer trial period and a great warranty. Fortunately, most people find the arrangement convenient too.

Can anyone start a mattress company online?

You could start an online mattress business as long as you can find a manufacturer, arrange for a website, and market your product sufficiently well. Most online mattress companies do not manufacture their own mattresses. This means most of the mattresses you purchase online come from a select few manufacturers. The bases are almost always the same, and there is nothing different in the technology either.

The tag and the price are the only things that are different in many mattresses, while some mattresses have small, specific changes. If you take a look at the failing companies, it’s usually these companies that fail. There is nothing unique to offer, and most of these companies are a direct replica of another product.

Eventually, comments, word of mouth, and reviews make it through, and sales decline. The result is usually evident after a few months. Most online companies focus on sales but don’t know how to handle the after-sales process. With no correction to the poor reviews, prospective customers who end up seeing the review will move on to other brands.

Why are some of the companies online growing steadily?

The answer is their uniqueness. While many businesses started off as just a mattress company online where you can purchase mattresses in a box, some have evolved over time, or some have come up with a unique product right from the beginning. Examples of some of the companies that really stand out include Eight Sleep, Saatva, Leesa , Purple, Layla.

  1. Eight Sleep: Eight Sleep started off using technology as its main selling point. While all mattresses are just mattresses with foam and spring, Eight Sleep integrated sleep tracking and temperature control into their mattresses, addressing issues for many customers. There is little to no competition in this area, which makes Eight Sleep stand apart from all its competition. This is also one of the reasons why Eight Sleep has been making steady growth.
  2. Purple: Purple was one of the few companies that started the innovative grid technology. Its design is completely different from all other companies and being patented prevents its competitors from copying its technology. It’s the technology that makes the mattress different and one of the key reasons why many customers are drawn to it.
  3. Saatva: Saatva was the first ONLINE mattress company with no stores. They did market as one of the cheapest mattresses, but today they are almost the same price as most other mattresses. Fortunately, they do fall under the luxury or semi-luxury category, which makes them a bit enticing. The key value of Saatva comes from the fact that they are crafted for people with back pain in mind. The Saatva RX and the Saatva Classic seem to have gone through years of research and are also chiropractor approved.
  4. Layla: Layla mattress started off with the copper-infused foam to cater to people who had allergies. Many people did find that allergies from foam or mattresses in general were possible and a problem. Layla addressed this problem earlier on and marketed their copper-infused foam mattresses to the world, making it a profitable business online.

What other mattresses still seem to be making good growth?

Apart from the above brands, there is a general consensus that organic mattresses are better than foam, and Latex, in general, seems to be more durable, supportive, and worth the money. Companies like Naturepedic , Spindle , Happsy , Eco Terra , and SleepEZ have made steady growth and have not shown a dip yet in their growth. It is believed that this trend will continue for the foreseeable future, and these companies will maintain growth. With companies like Eco Terra and Happsy, selling only one mattress model and still making steady growth, it sure supports the general consensus that Latex mattresses seem to be the current trend.

In conclusion, the mattress industry has experienced significant disruptions and shifts, particularly with the rise of e-commerce. Traditional business models have been challenged, and new players are adopting innovative strategies for success. The impact of e-commerce on the mattress industry is evident, with a surge in online sales during the first half of 2020. Companies are redefining comfort by selling directly to consumers online, eliminating middlemen and offering competitive prices. The increasing number of online mattress companies, estimated at around 175, poses challenges in distinguishing products with similar foam formulations.

The industry’s future dynamics will likely be shaped by how companies navigate the evolving landscape of e-commerce and customer preferences. Understanding these trends and adapting business models accordingly will be crucial for sustained success.