Jun 11, 2024 | Stock Analysis
The technological future of sleep is clear. Sleep Number is already there. As sleep technology advances, we can expect the mattress industry to become even more competitive. Sleep Number’s ability to integrate sleep technology into its products is a significant differentiator that will increase customer satisfaction. Ultimately, it will allow the company to increase its revenue.
Sleep Number’s Smart Bed Technology
Through its Smart Bed technology and its app for smartphones and tablets, Sleep Number promises to put customers’ money to work on sleep. Sensors embedded in the mattress monitor a user’s heart rate, breathing patterns, and body movements. That data is then fed to the Sleep Number app, which provides customized recommendations for sleep, as well as coaching features. The beds can automatically adjust firmness and support by moving air through the mattress while the user sleeps. All of which will supposedly help customers wake up ‘renewed’. The aspiration for our customers to rest and restore themselves also reshapes who becomes a customer in the first place.
Revenue Growth Opportunities
Sleep technology represents significant opportunities for Sleep Number to grow sales as consumers are becoming more health-conscious. People who believe they are healthy strive to get better quality sleep, and as the world becomes more technologically driven, more smart beds will come to market. Sleep Number is well-positioned for this growth. The company’s high-value, technologically advanced products will allow Sleep Number to charge a premium and leverage growth from existing products. Additionally, aggregating and selling the data that the smart beds create can open avenues for subscription-based services that offer personalized sleep insights and recommendations, creating new revenue streams for the company.
Competitive Differentiation
Its bed’s adjustable firmness settings and the way it connects to other devices distinguishes it from a traditional mattress. Its health monitoring and compatibility with other smart home devices – such as allowing users to set an alarm in the bed and turn off lights with a voice command – are value-added services that make the company more than just a traditional mattress brand. Sleep Number thus positions itself as a health and wellness technology who sells beds, rather than a mattress company that sells beds, thanks to the Undifferentiated Suds typology. This allows it to compete effectively with the hundreds of other mattress startups in a crowded market.
Customer Response and Loyalty
The consumer response to Sleep Number’s smart sleep technology has been extremely positive: consumers cite improving their sleep and their well-being, as well as the precision with which they can now manage their sleep environment. They often mention the features that allow them to uncover and monitor their SleepIQ score or provide them with insights into how they can improve their sleep using the Sleep Number app. These positive reviews build brand reputation and foster solid customer loyalty, while also leading to more word-of-mouth promotion that is beneficial for this leading smart-bed company. This kind of personalisation is particularly appealing to consumers that are not willing to conform to a one-size-fits-all approach to wellness, instead seeking customized products and services.
Competition and Future Innovations
Other mattress companies are following suit – Tempur-Pedic and Purple have added their own versions of smart mattresses and sleep-tracking devices – but Sleep Number’s leg up is their branding, as well as their range and integrated approach: other companies try to add in new technology, but Sleep Number’s products are holistic in both their service and their construction. Sleep Number will have a lot of competitors, but its constant stream of innovations and prioritization of holistic sleep solutions places them well ahead of the crowd.
But the future of sleep technology is bound to include even more advanced prosthetics, and the company is geared to harness innovation. The near future might bring increasingly detailed measures of health, integration with wearables, and more powerful AI-based systems that deliver deeper insights into sleep. According to Sleep Number, its way to stay ahead is to invest heavily in RD and closely collaborate – as it currently does – with tech innovators. ‘The future of sleep is more personalized, more technological, and more health-focused,’ as the company website proclaims, and indeed it looks like a perfect fit for Sleep Number’s mission. In other words, it’s a path that promises to keep the company growing and lead it into new terrain, where it will be challenged by many new players but also lead the pack as a pioneer of the technology.
Conclusion
The addition of advanced sleep technology has already transformed Sleep Number. Global advances in technology have improved the customer experience, opened new revenue channels and enhanced market differentiation. As the field of sleep technology continues to grow more sophisticated, the future appears secure for Sleep Number. The company has taken the necessary steps to continue to be an industry leader. The company’s slogan promises to bring one promise for better sleep.
