The global mattress market is highly competitive with key industry players adopting various strategies such as expansions, acquisitions, product launches, partnerships, and mergers to strengthen their market positions. Most companies in the market are focused on expanding operations across regions, augmenting their capabilities, and building strong partner relations.
Analysis of the Key Developments by Major Players
The developments undertaken by the key players in the global mattress market include strategic acquisitions, geographic and business expansions, product launches, partnerships, and mergers.
According to Wantstats analysis, expansions are expected to account for a majority 42% share of the total developments in the market. Key players are taking steps toward business expansions and entering untapped markets, thereby increasing their consumer bases. For instance, Serta Simmons Bedding, LLC opened a manufacturing plant in Seattle, Washington (US), with the aim to expand its manufacturing footprint and support increased consumer demand across the US and other parts of the globe.
Product launches are projected to account for a 32% share of the total key developments by market players. Companies in the global mattress market are introducing new and unique mattresses.
Acquisitions and partnerships are expected to account for 11% each of the total developments during the period of 2014 to 2019. The acquisition of major brands has led to the expansion of product portfolios in different regions. Furthermore, strategic partnerships and alliances are helping companies build healthy corporate relations with major players to strengthen product distribution and production. For example, in 2017, Kingsdown, Inc. partnered with Navijam, Incorporated, a South Korean mattress manufacturer, for the production and import of its products.
Market players are merging with several companies to strengthen product distribution and grow at a global level. Therefore, mergers are projected to account for 5% of the development share from 2014 to 2019.
The graph indicates the percentage of developments undertaken by key manufacturers in the global mattress market. Kingsdown, Inc. and Serta Simmons Bedding, LLC accounted for the highest development share of 26% during the period of 2014 to 2019. The strategies adopted by Kingsdown, Inc. include geographic expansion and partnerships to increase distribution across the US and other parts of the globe. For instance, the company opened a second store in Vietnam’s largest city Ho Chi Minh in 2017, which helped strengthen its consumer base and increase revenue. Kingsdown, Inc. also expanded product distribution throughout Florida, US, through a domestic licensing partnership with Biscayne Bedding International in 2017. This partnership extended Kingsdown, Inc.’s network of licensees and retail stores, as well as manufacturing capacity in the US. The company is also inclined toward launching new and innovative mattresses such as the ultra-luxury collection, Diamond Royale, with two-sided additions to its popular Tradition line up, and an updated innerspring Sleep to Live line, which were launched at the Las Vegas Winter Furniture Market in 2015.
Serta Simmons Bedding, LLC is aiming at expanding its manufacturing footprint in the US. To this end, the company inaugurated a new manufacturing plant in Moreno Valley, California in 2018, which has helped meet increased consumer demand for its two best-selling brands in the country, Serta and Beautyrest. Product launches are also part of the company’s strategies. For instance, Beautyrest, a brand of Serta Simmons Bedding, LLC, launched the Beautyrest Black, Beautyrest Silver, Beautyrest Complete, and Beautyrest Hybrid line of mattresses in Las Vegas in 2019. The company also adopts mergers as a step toward growth in the global mattress market. The merger of Serta Simmons Bedding, LLC with Tuft & Needle in 2018 helped strengthen its market position and expand its offering in the direct-to-consumer segment.
Tempur Sealy International, Inc. aims at growth in the global mattress market through the acquisition of major brands, launch of new mattress lines, and geographic expansion. The company is expected to account for a significant 16% of the development share from 2014 to 2019. In 2019, the launch of TEMPUR-breeze at the Las Vegas Market boosted company sales in the first quarter. Furthermore, the 2018 acquisition of Sealy Corporation increased its product offerings and footprint in the Americas, Europe, Asia, and Australia.
Sleep Number Corporation and Southerland, Inc. accounted for a respective 11% share of the total developments. Sleep Number Corporation is focused on launching products in the global mattress market and expanding its global footprint. For instance, in 2016, it opened its first store in Alaska, US. Southerland, Inc. adopts acquisitions and product launches as growth strategies. In 2018, it launched the Evolution Collection of hybrid mattress at the Las Vegas Market. In the same year, it acquired the assets of regional bedding producer Tualatin Sleep Products, based in Tualatin, Oregon, to expand its presence in Idaho, Montana, Oregon, Washington, and Wyoming in the US.
Threat of New Entrants
The global mattress market is highly competitive although initial investments are moderate, including the costs of processing equipment. Revenues are high considering the high demand for home furnishings in various regions. The production costs of mattresses are moderate due to the moderate investments required in processing equipment, skilled labor inputs, maintenance costs, and safety testing and certification.
The global mattress market is fragmented due to the presence of established players, along with local and regional players. New entrants need to invest heavily in creating a brand identity through innovative designs and producing quality products with the help of advanced technology.
Therefore, the threat of new entrants to the market is expected to be moderate.
Bargaining Power of Suppliers
Numerous suppliers provide the raw materials required for mattresses, giving manufacturers a plethora of options. Thus, they have the liberty to shift between suppliers as they are not dependent on a single supplier, which reduces their operational risk. Suppliers are not only concentrated in any single region but have a cross-regional presence, which decreases the switching costs for manufacturers.
Therefore, the bargaining power of suppliers is projected to be low.
Threat of Substitutes
There are no substitutes for mattresses. However, the market is highly fragmented and with intense internal competition based on quality, price, and convenience levels. For instance, consumers are substituting memory foam mattresses with hybrid mattresses based on their convenience and the comparative cost benefit. Thus, there are chances of product substitution on an internal level based on raw material and price although there is no direct substitute for mattresses in the market.
Hence, the threat of substitutes in the global mattress market is expected to be low.
Bargaining Power of Buyers
The presence of several major players in the global mattress market has attracted a wide consumer base. Due to a large number of existing manufacturers in the market, the switching costs for consumers is low. Consumers are well-informed about the product and their brand loyalty is low. Moreover, most of the consumers are price sensitive and tend to switch to offerings with a comparatively lesser price.
Thus, the bargaining power of buyers is expected to be high in the global mattress market.
Rivalry
The global mattress market is marked by high rivalry. Established players are targeting competitors on the basis of quality and price, making the industry competitive, reducing profit margins for all firms. Additionally, players operating in the market are competing based on customized offering and technological advancements. The wide scope for growth in the global mattress market has resulted in the entry of numerous players at the regional level, which increases the competition for global players.
Manufacturers in the global mattress market have moderate production capacities and focus on strategic investments. The major players are inclined toward enhancing their production capacities in emerging economies to meet the high demand in these regions.
Therefore, the intensity of rivalry in the global mattress market is projected to be high.
