Innovation

How Endy Sleep Plans to Hold Off a Big-Money U.S. Competitor

The Toronto e-commerce company sells a product most consumers are used to trying first: matresses

Written by Joe Castaldo

A mattress isn’t necessarily the kind of item you would think to buy online, but a crop of e-commerce retailers have emerged in the past few years specializing in mattresses. Endy Sleep in Toronto, for example, started shipping last year. The company offers one mattress model in different sizes, delivers it to your door, and will pick it up within 100 days if you don’t like it.

Co-founder Ari Herberman explains why consumers will buy mattresses online, and how Endy Sleep plans to stand out against U.S. competitor Casper, which is making a bigger push into Canada.

PROFITguide: How did Endy Sleep come about?

Ari Herberman: The co-founding team wanted to simplify the mattress buying process. It’s one of those industries in dire need of a shake-up. It’s premised on an antiquated business model that really lacks transparency.

When people go into purchase a mattress from a big box store, hopping around from bed to bed for 20 minutes, not knowing what the mattresses are made out of or why they’re $2,000, that’s a problem. But the e-commerce model—whether it’s selling eyeglasses like Warby Parker, or certain shoe companies—is a perfect model to try with mattresses.

Don’t people want to try out a mattress first before buying it, though?

Yes, people are used to going into a showroom, touching the mattress, lying down on it. But just because this is the way people are used to doing it, it’s not necessarily the way it has to be done. The way we combat that is by offering a 100-night trial period. We look at it as an insurance policy. If you don’t like it, we’ll come pick it up for you and issue a full refund, no questions asked.

You offer mattresses at a lower cost. How badly is that eating into your margins?

We circumvent costs like having a sales team and paying rent, so we don’t have the overhead. Because of that, we work to provide a very reasonable price. Our margins are certainly not what other players in the industry have, but what we’re sacrificing now in margins we will make up for in volume. Early affirmations are customers love the product. We’re okay with not making an incredible margin right now, so long as the customer is happy.

It’s easy for you to differentiate against traditional retailers, but there are other online firms doing the exact same thing as you. How do you stand out?

When looking at the market leader, Casper, which is now armed with close to $70 million in venture-backed capital, it’s certainly not easy. But we’re very good at finding innovative and cost-effective ways to break through the noise.

The low dollar means manufacturing here in Canada works in our favor. We’re priced more aggressively in Canada and in the U.S. than Casper is. And the mattresses are different. Caspers’ are latex and memory foam, and ours are 100% memory form. The advantage of being in Toronto, too, is that we’re able to participate in a lot of event-based marketing. Casper doesn’t have a lot of boots on the ground right now.

Does the fact that Casper is looking to increase its presence in the Canadian market concern you at all?

To be honest, it’s not a concern. In Canada, we’re talking about a $1-billion industry, so we feel there’s certainly room for a number of players. Locally, our main point of differentiation is that we manufacture everything right here in Canada, which really does resonate with consumers.

What do you think of Herberman’s plans for Endy Sleep? Share your (constructive) thoughts and feedback in the comments below.

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Originally appeared on PROFITguide.com