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Latest Piper Sandler report also shows shift to higher bedding prices

Foam shortages are likely to continue. Mattress advertising dollars are up. Consumers are more interested in better sleep as a key component of their health. And many retailers say the industry is seeing a shift to higher average selling prices.

Those are some of the key points in the April report from Piper Sandler, a New York-based firm that  surveys mattress retailers across the United States as part of its mattress industry coverage.

Each month Piper Sandler asks retailers how their sales compare with the same month the year before. For its April survey, the firm asked retailers to compare their April 2021 results with those from April 2019 because many retailers were closed due to Covid-19 restrictions in April 2020.

The retailers said that total delivered mattress sales, including foundations and adjustable bases, were up by a mean of 36% in April 2021, compared with April 2019.

On a two-year growth basis, retailers estimate second-quarter sales growth of a mean of 26%. “Overall,” Piper Sandler says in its report, “we suspect sales trends will remain steady or moderate slightly through the end of the quarter.” That second-quarter growth would be roughly in line with first-quarter growth, the firm says.

The latest report reveals that retailers overwhelmingly believe consumers are more aware of and interested in better sleep as a key component of their overall health and wellness. Seventy-five percent of the retailers “definitely” think consumers are more aware and interested in the importance of better sleep, with another 25% saying consumers are “possibly” more aware of the importance of better sleep.

“We believe this trend reinforces the shift to higher average selling prices,” Piper Sandler writes in its report. “As consumers place more focus on premium products, this encourages greater attachment of adjustable bases and accessories. Consumers will likely be more willing to pay for emerging tech-integrated products.”

In response to the April Mattress Retailer Survey, 58% of retailers said the industry is “definitely” seeing a shift to products with higher ASPs, while 42% said the industry is “possibly” seeing that shift. “This trend bodes well for more premium brands like Sleep Number and Tempur-Pedic,” Piper Sandler says.

Growing awareness of the importance of sleep, combined with the shift to higher ASPs, “could continue to support healthy demand trends into 2022 and bodes very well for premium brand strength,” the firm says.

In its latest report, Piper Sandler also talks about the mattress industry’s foam shortages. “Retailers appear to be getting notice that backlogs and supply chain delays from the ongoing shortages will likely persist well beyond Q2 as a result of strong demand,” the firm says. “Apparently, foam manufacturers are unable to catch up. Of note, in conjunction with strong consumer spending power, total mattress advertising dollars are up significantly.”

The firm says its insights on foam shortages were suggested by “very recent industry chatter.”

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