Tulo Mattress Case Study
Written for “Seminar in Advertising and PR”
Texas State University
Master’s of Arts, Mass Communication 2020
Overview
A new trend in mattress sales has gained momentum, and over 100 companies have now joined the market (Weaver-Cather, 2018). Consumers are shifting away from the traditional retail model and opting to purchase their beds online, sometimes without even trying them out. The beds arrive at their doorsteps rolled up tightly inside cardboard box. Once opened, they take about an hour to expand. They can then be placed on the bedframe and slept on the same night. Consumers say that this model eliminates the hassle that’s usually associated with mattress shopping, and the trend is catching on. In fact, 35% of consumers said that the bed-in-a-box feature was an important factor in their purchasing decisions (Desjardins, 2018).
Mattress Firm noticed this growing market and decided to create their own bed-in-a-box brand called Tulo. The nationwide retail chain faced many challenges this year, including filing for Chapter 11 Bankruptcy and closing nearly 700 stores (Meyersohn, 2018). This setback was largely due to their recent expansion, but the disruptive bed-in-a-box marketplace didn’t help either. In 2017, Tulo launched their “One Is Not A Choice” campaign, a humorous and colorful collection of videos and out-of-home advertising specifically targeted toward young millennials. Their platform was designed to challenge the leading bed-in-a-box brands and emerge as a leader in this new market.
Background
BedInABox paved the way for a new mattress model in 2006. For the first six years, they were the only major company of its kind. (Weaver-Cather, 2018). In 2012, however, Tuft & Needle entered the market with their own style of memory foam beds. Today, Casper is regarded as the leading direct-to-consumer mattress company.
Casper launched in April 2014 and sold $1 million worth of goods in its first month (Welch). Co-owners Philip Krim, Jeff Chapin, Neil Parikh, Luke Sherwin, and Gabriel Flateman found that the mattress industry was needlessly confusing, so they aimed to make this experience as painless as possible (Welch). Instead of offering several different styles, Casper sold only one. They offered free shipping and a 100-day trial. In the early days, consumers bought these beds sight unseen. After a few years, they started to expand. Casper partnered with West Elm to bring their beds to storefronts in 2016, and they built 15 pop-up shops in malls throughout the country one year later. (Eldridge, 2017). Consumers can now find Casper products inside Target stores.
Casper’s marketing strategy is also credited with their success. In 2015, the company took costumers out on a comfy boat ride around New York’s harbor to promote their Labor Day “sail” (Griffith, 2017). Casper launched the Insomnibot-3000, a chatbox that users can reach out to when they can’t sleep (Griffith, 2017). This humorous robot even has a recorded message that takes listeners back to the ‘90s, which appeals to Casper’s target audience of older millennials (Griffith, 2017). They raised awareness by partnering with podcasts, and they saw social media fame with their viral “unboxing” videos (Edison & Partners).
This summer, Casper launched a pop-up nap store in New York City called The Dreamery (Ha, 2018). For $25, tired New Yorkers could crawl into a soundproof cabin and rest their eyes for 45 minutes (Ha, 2018). This quirky event garnered press and went viral on Facebook. To make things even more convenient, Casper built The Dreamery right next to their retail store (Ha, 2018).
Casper has also received praise for its customer service. Employees are encouraged to send baby gifts to new parents, and they’ll even ship a bed overnight if something gets lost in the mail (Griffith, 2017). With 135,000 followers on Instagram and 663,000 likes on Facebook, Casper has a vast social media following. Their marketing materials often show images of fluffy beds with cute animals on them, which appeals to a younger demographic.
Casper has since departed from their original “one choice” model. In addition to selling bed frames, pillows, sheets, and dog beds, Casper now offers three different types of mattresses: the essential, the original, and the wave. At $2,250 for a queen, The Wave is Casper’s most expensive and luxurious product. With this, Casper is no longer just appealing to college students and thrifty millennials. They are now a large competitor for traditional brands like Serta and Tempur-pedic.
The Problem
Mattress Firm launched Tulo in October 2017, three years after Casper. At this time, there were already thirty brands creating similar products. Tulo had the challenge of positioning themselves as something different and pushing through the saturated market. The company searched for the other brands’ shortcomings and aimed to exceed customers’ expectations. The online bed-in-a-box industry has a different target audience than Mattress Firm, so Tulo had to find a way to reach that demographic. Even with their strategic planning, CNN Business writer Nathaniel Meyersohn thinks that the company joined the market too late, and now they are playing catch up. (2018).
Stakeholders
In addition to this challenge, Tulo struggles with issues from its parent company, Mattress Firm. The retail chain was acquired by Steinhoff International for $3.6 billion in 2016 (Bryant, 2018). Two years later, Mattress Firm filed for Chapter 11 bankruptcy. The company’s balance sheet revealed that their liabilities exceeded their assets by $1 billion (Bryant, 2018).
The company is set to close nearly 700 stores by the end of the year (Meyersohn, 2018).
The bankruptcy is largely due to Mattress Firm’s decision to buy out their competitor Sleepys for 780 million in 2015 (Meyersohn, 2018). With so many new locations, storefronts were often competing with each other (Griswold, 2018). Their timing didn’t help the situation either. As they expanded their retail presence, online sales began to skyrocket. Now, Tulo is faced with revitalizing Mattress Firm’s business and recovering from the bad press associated with them.
Research
Consumer Research
Before launching into the online bed-in-a-box market, Tulo likely researched the consumers who purchase these items. Allison Griswold reported in Quartz.com that Americans, by and large, hate traditional mattress shopping (2018). Mattress companies have a tendency to mark up prices and make the entire shopping process unnecessarily confusing (Griswold, 2018). It’s also difficult to compare brands because each retail store has a slightly different name for the same mattress (Griswold, 2018). Tulo combated this by creating a streamlined website that’s easy to understand.
It appears as though Tulo also researched consumers’ shopping preferences. Many customers were not interested in purchasing a mattress sight unseen, so Tulo placed their products inside their 3,500 Mattress Firm stores across the country. In 2017, Tulo’s competitors didn’t have this kind of reach. However, this is no longer the case anymore. When Mattress Firm filed for Chapter 11 Bankruptcy, the retail chain was forced to close 700 locations. At the same time, Casper started distributing in Target stores and opening pop-up shops. Leesa now has a partnership with West Elm in the United States and U.K (Howland, 2018).
Competitor Research
In order to stick out in the crowded market, Tulo investigated their competitors. Though it was not explicitly stated, it can be inferred that Tulo conducted a content analysis of Casper, Leesa, and Tuft & Needle’s campaigns. They noticed that their competitors offer free shipping, 100-day trial periods, and easy setups. These websites show catchy graphics, images of plush bedding, and excerpts from their best reviews. Casper focuses on a younger demographic, so their social media campaign features jokes, videos, interactive polls, and images of young professionals. Leesa and Tuft & Needle target a slightly older audience, so their marketing images are more mature. Viewers often see photos of smiling children and families on their websites and social media profiles. Leesa focuses on their philanthropic efforts while Tuft & Needle shares information about their company’s wellness initiatives.
Tulo appears to have taken these trends into account when creating their own marketing campaign. They one-upped their main competitors by adding 20 days to the typical 100-day free trial. Like their competitors, Tulo sells a product that can fit inside a box the size of a mini fridge. Tulo takes this a step further by including free “red carpet delivery” and old mattress removal. The company took inspiration from their competitors’ websites and added a handy info-graphic toward the bottom of the homepage that features their free-trial, shipping, and payment options. They also highlight some of their best press in a colorful scroll bar. Because Tulo is targeting a younger audience, they seem to gravitate toward Casper’s trends. Tulo’s social media profiles feature pictures of cute sloths and fluffy dogs. They also implement interactive posts that are designed to boost engagement, and it’s all done in a casual writing style.
Product Research
While investigating the other mattress-in-a-box brands, Tulo discovered that most companies only sold one style of mattress. Tulo jumped on the opportunity to offer something different. The company doesn’t explicitly explain their methodology, but their website states that they expanded upon Mattress Firm’s previous product research. It can be inferred that Tulo conducted customer surveys and discovered that people like having a choice in firmness. On their website the company said, “We tested ours with people all over the world and we found this suits everyone just fine.” After these series of tests, Tulo launched the slogan “One Is Not A Choice” and started offering soft, medium, and firm mattresses.
Target Audience
As Mattress Firm closed their stores, the company realized that they needed to focus on a different demographic. Their brick-and-mortar locations tend to appeal older consumers, and they noticed that millennials preferred to purchase their beds online. They created Tulo to fill that gap.
Even though Tulo took cues from Casper’s marketing campaign, their target audience is a bit younger. Tulo’s color scheme is bright and funky, almost like a college dorm room. Their marketing photos often feature images of college-aged women lounging in pajamas and watching a video on their laptop. Even the copy on Tulo’s website appeals to a younger consumer. The style is conversational and fun, often using words like “easy-peasy,” and “whole lotta convenience.”
Tulo’s 15 second videos were designed to be quickly viewed as people scrolled through their Facebook newsfeed. Each video focused on something that millennials would find funny or amusing. For instance, one video offered a scenario in which bowl cuts are the only form of haircut. This tactic plays on the nostalgia from the 90’s and early 2000s, which is especially relatable to their target demographic. Another video showed a world where sloths are the only pets. While many people may find sloths adorable, it’s especially relevant to younger millennials thanks to several viral YouTube videos. Tulo even took their commercials a step further and created gifs to spread across Facebook and Twitter.
Theory
Bed-in-a-box companies have disrupted the mattress industry. They have simplified the purchasing process and made deliveries easier than ever. Even with these advantages, however, consumers may feel hesitant to change their buying habits. The diffusion of innovations theory explains how a new idea or product spreads throughout a population. First, the consumers must think that the product is innovative and important. Then they will adopt it.
According to the diffusion of innovations theory, consumers fall into five categories. First, there are the innovators. These people are excited to take risks, and they need little persuading in order to try a new product (LaMorte, 2018). This could explain Casper’s initial success with selling their mattresses sight unseen.
Then, there are the early adopters. These consumers are also eager to try new things, but they need a little more information before jumping on board. The next group, the early majority, doesn’t consider themselves leaders, but they’re willing to try new things if they have confidence about the product’s effectiveness (LaMorte, 2018). Casper’s viral “unboxing” videos helped appeal to these two groups by showing their products being used by real people. Audiences could watch the mattresses expand in minutes, and the purchasers often cheered with amazement.
After reaching out to the early groups, companies need to appeal to the late majority. These people are more skeptical of change, and they can benefit from seeing the product first-hand (Lamorte, 2018). Casper and Leesa decided to take their products into storefronts so potential consumers could test them out. This tactic could provide the necessary information to the late majority and persuade them to purchase.
The laggards are the last people to change their habits. This group is set in their ways and aren’t likely to change (LaMorte, 2018). The laggards will most likely continue to purchase their mattresses in person, so it can prove beneficial for companies like Mattress Firm to continue their traditional retail model.
When crafting their brand, Tulo seems to have taken these different types of consumers into account. It’s easy for the innovators to purchase a bed online, but Tulo also has elements that appeal to the early majority. If they’re skeptical, they can try the mattresses out at a nearby Mattress Firm and see for themselves. Tulo also makes efforts to appeal to the late majority group and the laggards. By offering soft, medium, and firm mattresses, Tulo is using the same familiar language that traditional consumers are used to. This could help ease consumers’ transition into the new buying model.
Despite their efforts to appeal to new consumers, Tulo is still at a disadvantage. By the time they entered the marketplace, there were already 30 major retailers selling similar products.
This puts Tulo in the late majority group. Though they are not considered a laggard, Tulo still faces the challenge of crafting a unique brand among a saturated market.
Goals and Objectives
Tulo’s campaign goals extended beyond the just scope of the startup; it also effected Mattress Firm stores nationwide. As the brick-and-mortar shops struggled to meet sales goals, online stores continued to grow. With Tulo, Mattress Firm hoped to revitalize their sales and combat their impending bankruptcy. One way they did this is by transitioning into a showroom model. Here, consumers can try out the products before making their purchases online. Tulo also hoped to reach out to a younger demographic than Mattress Firm stores were used to. This way, they could potentially restore Mattress Firm’s respected place in the industry for generations to come.
Tulo’s first objective was to create awareness and prominence in the mattress-in-a-box industry. Because they entered the market relatively late, they had a bigger challenge ahead of them. By the time Tulo launched in 2017, Casper had already cultivated a rich following. Their elaborate events, quirky pop up shops, and humorous messaging helped position them as a lifestyle choice, not just a product. Tulo tried to combat Casper’s ‘one mattress fits all’ ideology with their own slogan, “One Is Not A Choice.”
Tulo also aimed to build the brand’s personality through this campaign. Their vibrant colors directly contrasted their competitors and positioned Tulo as a fun and friendly brand. Even though Tulo’s slogan is a subtle attack on their competitor, the company doesn’t come across as vindictive. The viewers’ attention is focused more on the pumpkin spice lattes and furry sloths than the minor insult directed towards Casper.
By positioning their brand as young and carefree, Tulo also strived to elicit emotions. The swift punchlines and goofy scenarios were designed to make the viewer laugh, and therefore make the audience associate Tulo with that same happy feeling.
The Campaign
Tulo’s “One Is Not A Choice” campaign spanned across social media, radio, TV, and billboards. Each one showed a wacky situation in which people only had one choice. They asked questions like, “What would life be like if sandpaper was the only kind of paper?” Then the camera cut to a bewildered woman tearing off a square of a sandpaper toilet roll. The videos were short, only 15 seconds, and they played across TV and social media. Tulo created gifs and still images from these videos and spread them across Twitter, Instagram and Facebook. Then, they took their social media ads even further with animated posts asking, “What if papyrus was the only font?” and “What if groundhogs were the only meteorologists?”
In addition to these videos, Tulo launched three radio ads that asked similar questions. Their OOH advertisements were seen on top of taxi cabs, billboards, and Times Square. Some signs were specifically targeted toward the region. In Atlanta, Tulo had a billboard that read, “What if Peachtree was the only street?” In Chicago, their signs read, “What if New York was the only style of pizza?” This campaign helped Tulo earn valuable press, as well. Good Housekeeping named Tulo one the top nine best online mattress brands, and they received positive reviews on Yahoo, Bloomberg, and Star (The Shorty Awards).
In order to cement themselves as a leader in this field, Tulo developed several strategies. First, they needed to attract the attention of young millennials and raise awareness about the brand. To do this, they relied heavily on social media tactics. With so many advertisements competing for people’s attention, it can be difficult to hold a viewer’s focus. Tulo’s short, eye-catching videos were designed to spark their audience’s interest as they leisurely scrolled through Facebook and Instagram. Things like sloths and pumpkin spice are already popular across social media, so it was especially strategic to put those elements into their Facebook ads.
Tulo also partnered with popular Instagram models to promote the brand. Their feed included images of famous influencers enjoying their new Tulo mattresses. By aligning themselves with these internet celebrities, they were hoping to position themselves as hip, young, and desirable.
Tulo also aimed to distinguish themselves from the competition and influence consumers’ attitudes about the company. To do that, they created a vastly different tone than their other competitors. Casper is known for its cool blue colors, so Tulo used bright pink and orange. Their competition boasts about selling only one perfect mattress, so Tulo made fun of that idea. They did all of this while maintaining an effervescent and playful tone.
Results
Tulo viewed their campaign as a success. Their videos had completion rates of up to 74%, and they had “strong engagement over Facebook” (Shorty Awards). The campaign made over 1.5 billion impressions, and it earned Tulo several pieces of positive press. Thanks to their marketing efforts, Tulo surpassed 2017’s Q4 goals. They also saw success on Black Friday, earning one million dollars without any special promotions. Tulo’s “One Is Not A Choice” campaign won the bronze distinction for Integrated Campaigns in the 2017 Shorty Awards. They were also included as a finalist in the Art Direction, Consumer Brand division.
Evaluation
Tulo’s marketing efforts have dwindled since they ended their initial “One Is Not A Choice” campaign. Their brand saw initial success, but it doesn’t appear to be growing.
Competitors like Casper and Leesa dominate the market, and they have significantly more followers on social media. Tulo continues to post regularly on social media, and they still partner with Instagram influencers. This may help drive sales, but it doesn’t appear to be boosting their online presence. Tulo could benefit from putting forth more engagement efforts on Twitter. Casper’s Twitter strategy includes a talking mattress mascot that tweets funny observations, and people seem to love it (Edison & Partners). As of November 2018, Tulo only has 106 followers on Twitter while Casper has 113,000.
When they first launched, Tulo relied on Mattress Firm’s respected name. Now that Mattress Firm has filed for bankruptcy, however, this element doesn’t have the same appeal. News surrounding their parent company has the potential to cloud Tulo’s image, so now there’s an even larger obstacle to overcome.
A significant part of Tulo’s campaign also relied on their showroom model. Consumers could easily find a Mattress Firm location and try out a Tulo there. However, there are now 700 less Mattress Firm stores across the country. Meanwhile, Tulo’s competitors can be easily found in Target and West Elm stores.
Alternative Approach
It was wise for Tulo to target the millennial online shoppers, but they could have benefited from targeting a slightly older demographic as well. The bright colors and topical references certainly caught peoples’ attention, especially in a Times Square billboard, but their recent social media marketing seems to focus on college freshmen instead of young professionals. Many posts feature the same sloth puppet seen in their first commercial. Used once, and it’s a humorous and memorable image. When it’s used weekly, however, it runs the risk of appearing juvenile and silly. It could prove valuable for Tulo to show a variety of images to appeal to a wide range of people.
Casper saw great success in their viral “unboxing” videos. They captured the excitement from real consumers and highlighted the product’s futuristic appeal. This word-of-mouth advertising didn’t cost Casper hardly anything, and it transformed a simple product into a hip lifestyle. If Tulo focused their energy on cultivating a loyal following, they could also create a wildly popular band. In addition to reaching out to influencers, Tulo could engage with everyday people. They could start a contest and make a call for submissions. To get even more of the community involved, they could ask their followers to be the judges. This helps spread product awareness, and it takes the focus off of Mattress Firm’s bankruptcy issues.
Leesa attracts many of their customers with their philanthropic efforts. For every ten mattresses sold, the company donates one to a homeless shelter or outreach center. They plant one tree per mattress sold, and they donate their time and money to local non-profits. Tuft & Needle developed a fundraising program that has helped over 200 schools across the nation. They have donated over $8 million worth of mattress to the community, and they have logged over 1,000 hours of volunteer work. Even Casper occasionally creates give-back campaigns to support organizations like The Red Cross.
Millennials especially want to support brands that align themselves with a cause (Agrawal, 2018). This demographic doesn’t typically have mush disposable income to donate to their charities, so they seek out the brands that do (Agrawal, 2018). Because there is even more competition in this market, it’s especially important for Tulo to develop a corporate social responsibility platform. All of these products are relatively similar, and this one detail could be the deciding factor between purchasing or not.
Conclusion
The mattress-in-a-box industry is proving to be more than just a passing fad; it’s a disruptive industry that’s changing the way people buy beds. Mattress Firm joined this market relatively late, and it had negative effects on their business. After filing for chapter 11 bankruptcy in October 2018, the company closed nearly 700 retail stores nationwide. Now, Tulo is tasked with revitalizing the company, a difficult endeavor with so many companies saturating the market.
Casper continues to dominate the industry by building a lifestyle out of an every-day product, and their creative marketing endeavors have kept them in the public’s eye. Tulo has identified their competitors’ weaknesses, and they continue to highlight them in their marketing endeavors. Despite this, the brand still doesn’t have the popularity that their competitors do. Tulo knows that their success lies in the millennial online market, and if they can successfully hone them in, they may be able to rebuild their parent company.
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