24 April 2024, 22:16
By Furniture News Nov 10, 2017

Out of the box: Casper's Jeff Chapin

Few industry trends mirror our developing society more closely than the bed-in-a-box explosion. The ultimate in mattress convenience shopping, it’s taken some time to arrive, but the traditional model now faces a fresh challenge, and Casper is one of its biggest antagonists. According to its co-founder and CPO Jeff Chapin, while Casper may not have invented the concept, it has pioneered a unique route to market – and, whatever retailers may think, it’s here for good. Paul Farley reports …
I meet Jeff, an amiable mix of designer and technologist, at Casper House, the brand’s pop-up in Covent Garden, in November 2016. The none-more-intimate setting is a back room that’s somewhere between massage parlour and safari tent – replete with mood lighting and ambiant birdsong – and has been installed to offer an oasis amid London’s pre-Christmas clamour.

Here, visitors are encouraged to take a nap on the US brand’s ‘perfect’ mattress. According to Casper’s blurb, the mattress combines memory, comfort, and support foams to offer a sleep surface that caters to the vast majority of sleeping positions and body types.

It’s a one-spec-fits-all solution that’s delivered boxed within two days of ordering – and just one of the many bed-in-a-box suppliers suddenly disrupting the mattress retail model.

Aside from the home-grown Simba, the majority of these players – Eve, Leesa, Tuft & Needle, etc – are US entities. Perhaps that’s a reflection of a nation quicker to embrace ecommerce, or at least to overlook its nuances. Either way, it’s over here now.

“The idea’s been around for 15-20 years,” says Jeff, who points to the existence of BedInABox.com, among others. “We don’t claim to be the first to do it, but I think we were the first to put the effort into building a phenomenal customer relationship and a brand around sleep – including the 100-day trial. Visit almost any developed country, and you’ll see a Casper copycat – a well-designed, direct-to-consumer bed-in-a-box brand.”

With significant investor backing – one funding round attracted celebrity investors including actors Leonardo DiCaprio and Tobey Maguire, and Maroon 5 singer Adam Levine – Casper launched in 2014, and arrived in the UK last summer. The rapid international success of the business model suggests that consumers are more willing than ever to make big-ticket purchases online.

“I think the trend is a natural evolution, given where technology and the economy have taken us,” says Jeff. “This couldn’t have happened 10-15 years ago, but given the ubiquity of ecommerce today, and growing trust due to repeated positive experiences with online retailers, I think almost any consumer product can move onto the internet.”

Consumers’ faith in online payment, delivery and communication systems has been immeasurably bolstered by the community building taking place in the background, says Jeff. “If you go back 10 years, most websites were purely transactional. Marketing was all push – through television adverts and billboards. There was no dialogue. Now you can build a relationship with your customers through Twitter, Instagram, Facebook and Youtube.”

While prolific above-the-line advertising is a defining characteristic of this new breed of mattress suppliers, Jeff insists that Casper’s marketing outlay is not as high as one might think. “Our CEO had been selling mattresses online for a decade before he started Casper, so he knew the economics of the industry very well.

“However, his cost to acquire a customer was north of $350, and while he built a relatively successful business by just buying Google AdWords, it wasn’t a scalable business.”

Casper’s strength, then, is in its community. Organic searches, social media referrals and word-of-mouth recommendations prove far more cost-effective and compelling than their display advertisement counterparts, says Jeff.

“All those social media platforms have figured out revenue models, and their feeds have filled up with advertisements. We heavily rely on people telling each other about their mattresses, and the more social shares, the bigger our network. People trust friends and family above all else.

“Since launch, we’ve been amazed how much two-way dialogue we actually have with our customers. What’s most interesting is when people post about Casper, but it’s not strictly about product – when they post about sleep, or the part it plays in their life, and we’re part of that conversation. It’s a more interesting place to be.”

The online floodgates may have opened, but it’s taken some time for mattresses to gain traction. “People are of the perception that they need to trial a mattress before they buy it, and that’s a notion heavily marketed by the brick-and-mortar retailers,” says Jeff. “We address this demand by trial.”

Casper has led the market in this regard, and offers a 100-day trial period – a far better guarantee of making the right choice, argues Jeff, than trying out any number of mattresses in a typical store.

“The alternative is going into a bed retailer who might have 30 beds. You’d probably spend five minutes on each, and perhaps try four or five before you get tired and go home with one to trial. Instead of spending £1500 you’re spending £500 because we don’t have to cover the overheads of 50 stores – the amount of margin the brick-and-mortar stores pile on top of the wholesale price they pay is crazy.

“I don’t think the benefit of choice is as good as people think it is – the real test has to happen at home, but you don’t get to take all five home and try them. A trial also gives people confidence that we are a real company – people need to trust that a start-up is going to be around a while.”

Providing peace of mind is a risky business, and the expenses are significant. Casper’s pre-launch model assumed a maximum returns rate of 8%. “The numbers are actually better than that,” says Jeff. “If they weren’t, we would probably be out of business by now.”

The figure reflects Casper’s confidence that its mattress model is suitable for nine out of every 10 people, based on user testing. It’s a bold claim, and a rejection of the popular notion that sleep is a matter of individual preference.

“I think it’s difficult conceptually,” admits Jeff, “but from a physiological standpoint I firmly believe that 95% of the population will be comfortable on the thing we’ve designed.

“When we were doing our initial pitches to raise investor capital, everybody referred to us as ‘mattresses for millennials’. We just got data back on our market – 25% of our customers are over 50 years old. I think the benefits we’re offering are pretty universal.”

The mattress comprises a “springy, breathable” layer atop “pressure-relieving” memory foam, offering a finely-tuned balance of support and sink.

“We combine visco foams with bouncier foams to get the benefits of the main types of beds on the market, but eliminate some of the drawbacks of those materials,” says Jeff. “There’s no question a spring bed will have a little more bounce and resonance to it, but the difference people draw between spring and foam is funny to me – at any reasonable quality level, on every spring mattress, you’re still sleeping on foam.”

Casper launched the model in April 2014, and since then has tweaked it a number of times in line with customer feedback. As order numbers have grown, the company has also been able to make material improvements, Jeff explains: “Now that we’re buying up to 700 mattresses a day from our suppliers, we can be much more demanding. It’s a huge volume of a single product.

“We have our own polymer chemist who develops new polyols, and we have our suppliers incorporate them. It’s generally very difficult to get foam producers to change their processes, but if you can guarantee them 500 units a day, it’s a different story.”

He says that the changes have had a huge impact on durability. “Mattress durability across the industry is reasonable, but ours is off the charts right now. The testing agency we used in Germany asked for a second sample because they’d never scored any bed so highly.

“There are massive differences in mattress quality in this industry. You can put the same label on two different things, but it comes back to the raw materials. The proxy most people use is the density of the foam – but I’ve seen high-density foams that are crap and others that are phenomenal, and the same at the lower end of the scale. Some people out there load them with mineral fillers to raise densities just so they can charge a higher price point.”

Whatever the content, Casper prefers to focus on the lifestyle benefits on offer. “There’s no final arbiter of truth out there,” says Jeff. “All we can rely on is that we make the best thing for our customers, rely on positive feedback and reviews, and provide customers with a great experience.

“Most people don’t care about the technology – they care if it’s comfortable, if their body is supported, if they get pressure points, or are too hot – basic human things. I don’t think they care how they get there.”

In some ways, the approach of Casper and its fellow disruptors is refreshingly direct. While the wider bed industry has seized on the potential to talk up the health and wellbeing benefits of beds to varying degrees, the new breed has been quick to begin direct dialogue with its customers, brushing aside the transactional nature of any exchange in favour of a soft sell.

The proof of the pudding is in repeat orders – an area in which Casper is prospering, says Jeff, who believes that whether an existing customer is looking for Casper sheets, pillows, a second mattress – even a dog bed – it’s clear there’s a good deal of faith in the company’s well-cultivated online community.

Trust is further bolstered through a degree of physicality. The team at Casper House reports that the pop-up has garnered much attention from tourists and local employees since it opened in August, while Casper’s Nap Room at WeWork, a co-working office space near Paddington, delivers a more formal opportunity to recharge.

It’s telling that there are no prices on display. “We don’t look at the physical space as transactional,” says Jeff. “It’s about building a dialogue around sleep.” He describes a location in LA that’s similar to Casper House, which hosts weekly yoga sessions, wine nights and film screenings.

“It’s crazy – in LA on a day where we have an event we’ll get around 900 people through the door. We may only sell nine or 10 beds – from a conversion rate standpoint, it looks like a failure – but we get so many people engaging with us as a company, in an activity that could eventually help them get better sleep, and many of them will share something of their experience online.

“There’s no hard sell, no commission – there’s nothing to upsell to!”

Our time together is drawing to a close. Jeff is currently following Casper’s expansion trail, as the brand branches out further across Western Europe. The expansion may appear rapid – Casper has gone from a standing start in 2014 to cover the US, Canada, the UK, Germany, Austria and Switzerland – but it’s been deliberate, with each territory’s mattress developed to suit the local market.

Having arrived a few days ago from Lisbon, Jeff is concluding his business in London by joining a panel at Wired magazine’s retail conference this evening. From there, he’s off to Berlin before returning home to San Francisco at the end of the week.

As we part ways, there’s just enough time to ask Jeff about the longevity of entities such as Casper. Given its social context, is there a chance the bed-in-a-box trend could dissipate as quickly as it arrived, and what, if anything, could disrupt the disruptors?

“Will there be a time in which 100% of mattresses are sold online? Probably not, but nowhere in the future do we see a saturation point for Casper.

“So much has changed already. Go back in time and look at how people said they’d never buy shoes, or books, online – we’ve heard similar refrains for so many things.

“The internet’s pretty amazing. If I walk into a retail store, what’s my experience? I can look at the marketing material, talk to the sales representative and try a couple of products. On the other hand, if I go online I can read everything everybody says about a product, in much more detail.

“I can watch YouTube videos of other people who’ve bought that product, read blogs or postings about it, I can see them in my social media feed, and go read newspaper articles. There’s just so much more information to inform my decision.

“Even if somebody does buy from a brick-and-mortar store, they’re doing most of their research on the internet – but it’s very hard to research the model that’s sitting in the store because the mattress industry is always mixing models, deliberately hobbling their ability to research. It’s certainly not consumer friendly.

“I just see more and more people purchasing even more expensive products such as mattresses online,” confirms Jeff, before adding a caveat, “as long as the other companies don’t fail.”

While start-ups such as Casper are engaging a receptive online audience with undeniably strong communications and economies of scale, their success ultimately depends on trust – and trust can be eroded.

“The worst thing for us, honestly, is if a competitor screws up and fails on the customer experience,” Jeff confesses. “If they sell a faulty product, it could ruin it for everybody. There’s just so many new companies coming in that, through ill will, or just negligence, some almost certainly won’t stand by their word. The situation actually poses a bigger risk than if your competition is strong.

“As it stands, our key online rivals all seem like decent actors. They’re not in it for a quick buck. To be honest, our real rivals are the brick-and-mortar businesses, the industry giants.

“Do we want to be bigger than all of them in the UK? 100%. That’s why we’re here.”

This interview was originally published in the January 2017 issue of Furniture News magazine.

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