ilers all ‘disrupting’ the Australian mattress market. An unexpectedly high growth market According to IBISWorld data, the Australian mattress market is not necessarily as small as you would think. It’s approximately $700 million and growing at an annualized rate of 5 per cent per annum – comparatively high to the lagging retail market. Traditionally the market has been occupied by either high-cost retailers such as Sealy and Sleepmaker or by low-cost providers who use flashing signs to advertise “half price mattresses”.  However recently, the instore experience of jumping on a variety of mattresses (and potentially falling asleep on some), has been traded for a different offering online. Emergence of the ‘cool’ mattress retailers It’s brilliant that online mattress retailers carved out a market by reducing a traditional mark-up and offering a good, firm mattress for 30 per cent of the usual price. The mattresses are made from foam or latex, and no doubt any eight of the aforementioned mattress retailers have differences, particularly when it comes to their product. However interestingly, all have opted for a very similar offering of: $700 to $1,300 for a Queen size mattress 10 year warranty 100 day free trial or a full refund Australian made (which invariably means that only part of it is made in Australia, as the only foam manufacturer, Dunlop, is owned by Sleepmaker) Focus on mattress not associated furniture such as beds Free delivery (possibly within hours for metropolitan areas) Convenient ‘in one box’ packaging This is further underpinned by a significant digital marketing investment including a social media strategy which hammers home the question that the bed is firm and can balance glasses of red wine – the more players that have entered the market, the more glasses of wine that seem to be cautiously placed on top of each other. Interestingly, the online retailers opt for a marketing strategy that doesn’t focus on getting ‘a good night sleep’ and rather aims to create a brand presence targeted at males and females aged 25-45, possibly recreating childhood moments of jumping on mattresses while still emphasising the value of their product. One would have to question how long the mattress industry in Australia can sustain so many similar retailers However where the offering and marketing is so similar, what’s next for this ‘disruption’ to the mattress market? The market leader – Koala Recently Koala, arguably the most successful online mattress brand in Australia, announced that it was raising $15 million to fund their expansion. An incredible result for a company so early in its journey. However while Koala might have gained a significant market share over its nearest competitors through effective marketing, competing on a low-cost platform where the offering is so similar to others may mean that the industry is primed for another change. Whether it be through industry consolidation through acquisition, an entry of a larger retailer with a similar brand position such as Kogan, or a price war driving mattress prices to unprofitable levels – one would have to question how long the mattress industry in Australia can sustain so many similar retailers. Arani Satgunaseelan is a principal consultant at ADP & Co, a management consultancy specialising in strategy and analytics for the retail sector. Arani can be contacted at arani@adpandco.com.