How many mattress brands can the world support? That is a perennial marketing question, usually aimed at the massive clutter of competing D2C brands across all categories. It seems to me the Purple mattress brand, however, always had going for it three important "P"s to differentiate it among the me-toos. They had Proprietary technology, a Puckish humor to their ubiquitous video advertising, and, of course, they were Purple. Even so, the brand still has to contend with rising customer acquisition costs, and a physical retail channel that has become constricted at best. But Omnichannel Marketing Director James Brohamer is cooking up an evolving media mix that he playfully describes as a kind of “alchemy.” He tells Brand Insider how Purple is exploring new channels, like OTT, influencers and even direct mail. “It’s akin to “sitting in a dungeon mixing a bunch of unknown reagents,” he says. You can listen to the entire podcast here.
MediaPost: What were some of the biggest shifts the Purple brand saw in its marketing and media plan as a result of the Covid crisis?
James Brohamer: We were seeing a big trend in some of our segments from our traditional D2C channels to nontraditional channels, like direct mail, inserts. And really, at the end of the day, the past behaviors that we've seen in consumers aren't necessarily the best indicators of how to reach them or engage them any longer. So we've really had to reevaluate what's currently working, and just quickly pivot our media spend that way.
We weren't late to the game in the D2C online world, but we certainly weren’t perfect. So we've done a lot of refocus and re-pivot on our website, on our user experience, on our customer journey. And we've really shifted a lot more of our focus on content and the upper funnel affiliates who are like the review sites, the comparison sites. And that's because people have to do their own research now, they can't go out to a retail partner, and lay on a mattress or try the pillow. They’re wholly relying on word of mouth or what they're seeing online, so we've really focused on that element of our performance marketing as well.
MP: Seat cushions were a surprise hit for Purple. How did that happen, and what did you learn from it?
Brohamer: The seat cushion was originally designed for wheelchairs and people in wheelchairs. And prior to the pandemic, we had one or two seat cushions and they were an ancillary product, and they sold okay. But then going into COVID, a lot of people were stuck in whatever chair they had at home. Throw in the trucker and that delivery drivers. Suddenly, how you sat for nine to 10 hours a day was critically important. So fortunately, we have our own R&D team and manufacturing here in Utah so we were able to reiterate a lot of our different cushions and start pushing those to the market.
We built a back cushion, the lumbar support, in addition to a regular seat cushion, different styles of seat cushions, and that really just took off. It's kind of foreshadowing the future of the company because we're really moving from just a mattress company to a company using our technology in other areas as well.
MP: And it became a low-priced gateway drug to an otherwise expensive product line.
Brohamer: Traditionally, the industry, especially mattresses industry, has been kind of like the car industry of the 1960-70s. I just need to sell one car to one person and move on. But with these other products, seat cushions especially and even pillows, it is a low entry point to try to feel how legitimate the technology is before somebody ponies up $1,500 or more on the mattress.
MP: Several marketers we have spoken to in recent months mentioned the surprising power of direct mail.
Brohamer: We started testing out direct mail right before COVID to just see if it would work, and we got good results. But once people were home longer and longer, the direct mail just seemed to work. I don't know if it's that people had everything delivered to them so there’s more focus on [it] now, because the consideration time for a mattress is pretty long. Direct mail is one of those pieces where you can stick it to your fridge, and it's always in sight if you have interest and intent.
It is really good for people who have either interacted with us in the past but are no longer interacting with us or just prospecting. I wouldn't have ever thought direct mail for prospecting would work, but it's actually worked quite well.
I think the secret for us, and I think for any retailer, is a direct mail partner tied into your CRM, somebody who can actually use the data, somebody who has a good analytics platform, more than just sending out a traditional mailer and hoping it works.
MP: D2Cs are famously faced with a customer acquisition challenge of their own making: rising digital media costs their VC-fueled category helped drive up. What is the Purple plan against these challenges?
Brohamer: When we started, Purple was very much high frequency: hit ’em with the ad every single possible moment whether it's YouTube or Instagram. But now with those CPMs increasing, we're going to a lower frequency, but we're taking that frequency and moving into other channels with more reach.
So what we're really trying to build into our media mix now is duplication. Now, we’ll show this many ads on just traditional digital video or native, and we’ll layer that with some Hulu, we’ll layer that with some Instagram. And at the end of the day, hopefully we increase our frequency on that individual through duplication of other channels without having to pay the increased CPMs that some of these platforms have.
MP: How are you ensuring good match rates across those platforms?
Brohamer: We've kind of gone a little old-school and started to look at traditional media models to give us a good indicator. And then we just look at the performance in the ROAs and start turning one up, turning one down and see what's happening and see what kind of results were getting. We'll go through phases where we only prospect through a certain channel that will shut it and retarget and keep flipping that back and forth.
It really is like alchemy. You're sitting in a dungeon mixing a bunch of unknown reagents.
MP: You've been working a lot in OTT and the connected TV space, which many still find inscrutable. What key things have you learned about OTT?
Brohamer: One of the key things is find partners who can reliably measure. We're fortunate. When I first came on, we started vetting out agencies to help us with linear and nonlinear, and we landed upon an agency that's pretty solid on measurement for OTT. OTT has come a long way. Five years ago I would not be saying this, but partners like Hulu can now deliver measurable metrics, and so it's become easier and easier to measure your performance and to measure the ROIs.
You still don't get the reach that linear gets but we can buy both programmatically and direct and we're seeing really good success with a lot of our OTT partners. It comes at the cost of reach, because we do frequency cap there as well, but overall it's become a really strong strategic plan, and COVID hasn’t hurt. Just the performance difference between Q4 last year and two months after COVID, the results had shifted dramatically in OTT’s favor.
MP: Given the limitations of reach, how much targeting can you do?
Brohamer: You can do a lot of targeting depending on the platform and who you're buying. In some cases, we found that their targeting and their audiences do really well. But then, just like linear TV, there are other platforms where we do better just running against specific content, and not actually even targeting. Then OTT is really starting to become more like linear in that you know you have an audience, but you don't know where to be in front of that audience and when.
And sometimes that targeting is misleading. That's another interesting thing we've seen is that traditionally, some of our linear networks and shows haven't performed that well, but when we buy up against them in the OTT space, they actually perform. That's something that we're starting to dig into a little more. What shows have we walked away from in the past on linear that we should probably revisit on OTT?
MP: By the way, since you're both on linear and OTT and that space is getting flooded, especially with political money, are you having any trouble with availability or pricing on any of the platforms because of political spending?
Brohamer: Oh, for sure. I think, our clearance for this month on DR, we may clear 60% of what we planned, maybe. And it's not just political; it’s sports. The availability is going way down, and you layer that in with political and TV’s a tough space to be in right now.
MP: When and how does the D2C mattress brand shakeout finally come?
Brohamer: I think it's going to come pretty soon. People are going to buy these products and realize that they aren't necessarily what they want and swap them out for higher-end product.
I think that most of these companies are running on that venture-capital-supported D2C theory that if our cost of acquisition is lower than our lifetime value, we're golden. With the CPMs rising, with the cost of acquisition rising, I think that's going to shake some people out. You only have so much money to burn. Media hasn't gotten any less expensive since we launched as a Kickstarter.
And so I think we're going to start shaking that out. But I think overall consumers are getting a little more intelligent and a little better educated on just mattresses, in general. Prior, you didn't put a lot of thought to a mattress, it was one of those things that either I’ll buy the same mattress I had or I'll go lay on a few; they're all the same.
People have gotten really much better at looking into sleep and looking into the products they're buying, specifically mattresses. Also, one of the things that we're leaning into, we have a ton of passionate brand advocates: people who have slept on our product, use our product and support us. And so we're really leaning into that as well. Building out loyalty programs. We send product to nearly every podcaster who we run with so that they actually have the product, they can feel the product. We do everything we can to put our product in front of people so they actually get to try it.