In a recent interview with Barron’s, Purple CEO CEO Joe Megibow remarked,
There is significant unmet demand out there for our product. We are selling every bed we can make.
If that’s not impressive enough, he goes on to explain that Purple makes their own machines in house! They only have 5 machines and are almost doubling that number.
We actually make the machines that make the beds, and it takes us six months to build one of these machines. So we’re at five [machines] right now. We’re building four more this year. So we’re substantially expanding our capacity”
Here are some more facts from the article:
- Purple is profitable with $8.4 million in profits in its latest reported quarter, while growing sales 66% to $117 million.
- Purple has 1.8 billion views of all their videos – which are all mattress ads! They’ve built a brand and audience that continues to watch their videos. YouTube and Facebook are where they get the most views. This is the powerhouse behind Purple’s sales.
- They are eyeing the international market saying over half the market is outside of the U.S.
- They’re in the premium bed market. “We don’t compete with Casper. They’re selling mostly $600 and $700 mattresses. We’re selling mostly $1,500 and $2,000 mattresses. We’re not really competing for the same customer. This is more of a premium play.”
- Purple mattress is unique and not just another foam block. Their patented hyper elastic polymer that’s in every mattress and the lack of memory foam in their beds makes them stand out from other brands. This is key when you see comparison reviews. They’re substantially different from Casper and other bed in a box brands.
One point that wasn’t made in this summary is how much Mattress Firm has contributed to Purple’s growth. When I was at a local Mattress Firm I asked why Purple isn’t in all of their stores. They said they cannot produce enough Purple mattresses to supply the stores. So that’s a significant area of future growth as they ramp up production.
Purple vs Casper
Since announced their IPO, Casper has been under a lot of scrutiny. Here are some points of differentiation:
- Casper sells mattresses in their own branded stores and Target. Casper says on average they get about 2x the sales online in markets where there’s also a retail store. Purple sells through several stores, including Mattress Firm, Macy’s, Bed, Bath & Beyond and more. None are their own branded stores. One Mattress Firm ad touted that about 90% of people who come to Mattress Firm ask about Purple.
- Casper outspends Purple on marketing by a long shot. In 2018, Purple spent $17 million in media online, outdoor, television, newspaper, magazine and radio (source). Casper has been called more of a marketing company than a mattress company. Casper spent $200 million on buying mattresses to sell in 2018 and around $126 million to market and sell them (source). That’s over 7x what Purple spent!
- Of course, Casper isn’t profitable while Purple is.
- We’ve definitely seen evidence of Purple copying Casper’s hip style of marketing.
- As a YouTube geek, you can see how Purple’s top videos have much higher subs and views compared to Casper’s. Purple takes a direct sales approach (edutainment) and from talking to their marketing department and from our own experience, they convert to sales. Casper’s videos are amazing but not educating to sell.
But, Purple, who came up with this one??
Streamlined Product Line
What you may not know is that all of Purple hybrids are the same except for the number of inches of flexible polymer each one has on top. The Purple 2 has 2″ and the Purple 3 has 3″, etc. And as you add another inch of polymer it adds an additional inch of height to the bed. The thickest Purple is a Purple 4, which is 13″ deep. This streamlines the manufacturing process (saves costs).
This is notable because it’s so different than other brands that come out with various models which address common problems. For example, a cooling gel bed for people who sleep hot. Since Purple doesn’t have memory foam (which is known to get hotter over time as you sleep on it) and because the top layer has built in airflow, it naturally sleeps cooler. The selling point is in the purple stuff (the polymer on top)!
We’re not seeing any talk of tech or smart mattress type offerings from Purple. Other than mattresses, their most on-brand products are the Purple Harmony and Purple original pillow (we don’t understand how the Purple plush fits into the brand).
Want to learn why we’re huge fans of Purple mattress? It’s what we sleep on. Check out our Purple bed review.