7 min to read

6 Ways to Increase Ecommerce Profit Margins for Mattress Retailers

Online Mattress Ecommerce

The arrival of COVID-19 was one of the significant causes of e-commerce's popularity. Almost two years after this event, they have increased the sale of items that used to be preferred to buy physically, such as clothes or shoes. Still, an Item that has curiously increased its sales exponentially on e-commerce platforms is mattresses. That's right; this niche is one of the most profitable online stores. And although some users in the United States still prefer to buy it in person, another substantial percentage of entrepreneurs experience the benefits of selling mattresses through the internet.

In an article from Price Spider, we found that Internet Retailer Stephany Zaroban said that the online mattress business is ranked globally as half of the top six fastest-growing online retailers. The same article states that these companies are doing something that no online merchant has achieved before: selling mattresses to the same level as only brick-and-mortar stores could.

Now with this information, you may feel lucky to have chosen the niche you are in. Still, as a business owner, you have to be careful with one specific aspect, profit margin, as it determines how much you are generating and evaluate the health of your business. It shows how much of every dollar your business keeps from every earning and lets you know how good is your e-commerce doing and how you could improve it. This concept represents the net income divided by the net sales or revenue.

So, if you are trying to increase your profit margins, ask no more because, as experts in digital marketing today at Codedesign, we share with you six strategies you can use to improve your profit margin on e-commerce platforms.

If you are reading from your mattress, lie down comfortably and learn how to boost your profits!

But first, let's dive into the data about this market. 

What is the profit margin of the mattress business?

Well... profit margins for this industry are high, really high. 

According to a report from Chicago's Very Own WGN9, we found that mattresses have a markup in the 40 to 50% range, backed up by a study from "Tuft and Needle" that specifies that a $3,000 mattress might only cost $3000 to manufacture, generation a 900% markup.

The reason for the prices of mattresses could impress more than once since it is not as simple as it could be deduced.

At first glance, we might think that the price of a mattress depends on the quality of its foam and other layers, and although it does play a role in the price, it is not what increases its value.

Let's see, memory foam and other features such as border trimmings are factors that add to the price, but companies add to this high price the time of scientific study that it took to find all these "comfort technologies." In the same way that a doctor charges you $100 for a single consult, the professional could have taken only 2 minutes, but he does not charge you for the time but for the knowledge that it took him to get there.

In the same way, a large industry is responsible for creating more comfortable materials, but above all, durable, which adds to the great value of these mattresses.

In addition, it is good to emphasize that some good hours of sleep recharge everyone, so investing in good quality and durable mattress will bring endless benefits to your general well-being. Hence, it is an expense worth every penny.

Source: YouTube.


Now that we know how profitable this market is let's offer valuable tips to increase earnings.

Raise your prices

Yes, it is a tough decision for some of us, but believe it or not, it generates excellent results.

Rather than what "common sense" makes us think, lowering prices and giving too many offers isn't the best way to raise our profit margin. But then we ruminate our thoughts on thinking, " if I raise the price,s people will stop buying," "sales will dry," and "my business will fail.". Let us explain, relax because it isn't the case for mattresses.

Raising prices is an excellent idea for high-demand products, and as we noticed in this article, this niche has a decent amount of demand. So, no matter if you raise your prices quite a bit, people are still asking for your products, so it is a good idea to take this opportunity.

But let's illustrate it better with an example. According to The Sleep Foundation, the mid-range bed prices are between $500 and $ 1500. Let's calculate it to see how good results we could get. We'll take $300 as the average price to build a mattress, so:

  • Mattress retail cost: $500
  • Wholesale cost: $300
  • Profit: $200
  • Profit margin:  40% (profit $200/cost $500)

Now, let's raise prices a little bit.

  • Mattress retail cost: $650
  • Wholesale cost: $300
  • Profit: $350
  • Profit margin:  53.8% (profit $350/cost $650)

As we observe, by raising our prices a little bit we experience a significant increase in our profit margin, realizing that this is a good decision for your business.

E-commerce profit margins

Diversify your product line

Mattresses provide us with the support and comfort to sleep, but there are gadgets that this experience lacks to make it even more pleasant. We imagine that you know what we mean. Well, bedding products are a great addition that you can add to your business to expand your options, offering them a complete comfort experience. Read these hotel trends 2022.

So, you can add essentials like:

  • Bedding sets
  • Overall sheets
  • Linen sheets
  • Pillows
  • Pregnancy pillows
  • Inflatable air mattress

Find as many good quality products you can offer to add to your mattress experience, and profit results will come effortlessly to your business. Read this detailed guide on voice search optimization.

Source: YouTube.

Improve your shipping solutions

One of the primary attractions of e-commerce is convenience, and shipping is almost 50% of this convenience. Concerning mattresses, items that can be heavy and difficult to transport, offering free shipping options or the opportunity to pay extra for shipping will be great for your profit margins. In the Shipware portal, we got these valuable tips to improve your shipping:

  • Audit your shipping: keeping track of how your mattresses are delivered is crucial to improving your situation; this includes knowing the number of packages for each week, shipping timelines, locations produced, sizes and weights and any other factor you could consider. 
  • Automate your recovery checklist: carriers can miss guaranteed delivery time or make errors on invoices, and that's why you should automate this part to increase your operating profit margin.
  • Negotiate your shipping contracts: Negotiating with your shipping company or seeking help from experts can be a great idea to improve your entire e-commerce.

Mattress E-commerce business

Use centralized solutions to improve your inventory's visibility.

Order is necessary for your business to flow, so finding a way to centralize your inventory so that as much as customers can see it will bring you great results in the long run. You see, when you don't organize your list, you can get inconveniences like:

  • Underselling mattresses that are already overstocked.
  • Oversell items that you no longer have available.
  • Generate shipping delays and complaints from your audience.

The last point is crucial because you don't want to disappoint a customer expecting a mattress they saw and be disappointed that it is no longer available. As this report from PeopleVox informs, 34% of businesses have delivered an order late because they sold a product that wasn't available, so be careful with this.

Once everything is organized, you can:

  • Identify which mattresses experience the most significant difficulty in their transfer.
  • Find out what are the most popular beds in your business.
  • Get products that are transported quickly, and take advantage of this discovery to promote them more in your industry.

Mattress Business

Get clear on your most and less sold mattress to reduce unnecessary expenses.

If you have followed our advice, such as organizing your inventory, you may realize that there are products on your list that may not have any popularity, so the most viable thing is that you stop investing in them.

In the same way, by organizing this, you will realize those extra expenses you are making without any sense, allowing you to manage your costs better and speeding up your business.

Keep up with mattress trends to renew your business.

Once we have removed what no longer works in our online store, now it is an excellent idea to investigate those novelties that can give our store a plus. Mattresses are evolving, and they are no longer just beds for sleeping. No, now they can be adapted to the poses in which the user sleeps. They can come with a massager, even with a home theatre and much more. Stay updated about new products or advancements in your niche to stay on top.

Source: YouTube.

Final Thoughts

Organizing our finances and combining them with a great selection of quality products, plus the right marketing strategies will ultimately make our investments count and double or even triple our profits at the end of the month.

The mattress industry is experiencing good growth, so it is necessary to renew our management strategies to take advantage of this sound wave that we are going through. Suppose you want to get more out of your business. In that case, your best option is to partner with digital marketing experts like Codedesign since we have a level of expertise in handling eCommerce and being an agency that specializes in industry titans like Amazon. Contact us and let us take your online business to a new level.

Until a new article, see you!

About Bruno Gavino

Bruno Gavino is the CEO and partner of Codedesign, a digital marketing agency with a strong international presence. Based in Lisbon, Portugal, with offices in Boston, Singapore, and Manchester (UK) Codedesign has been recognized as one of the top interactive agencies and eCommerce agencies. Awarded Top B2B Company in Europe and Top B2C company in retail, Codedesign aims to foster personal relationships with clients and create a positive work environment for its team.  

He emphasizes the need for digital agencies to focus on data optimization and performance to meet the increasingly results-driven demands of clients. His experience in digital marketing, combined with a unique background that includes engineering and data, contributes to his effective and multifaceted leadership style.

Follow Bruno Gavino on Linkedin

About Codedesign

Codedesign is a digital marketing agency with a strong multicultural and international presence, offering expert services in digital marketing. Our digital agency in Lisbon, Boston, and Manchester enables us to provide market-ready strategies that suit a wide range of clients across the globe (both B2B and B2C). We specialize in creating impactful online experiences, focusing on making your digital presence strong and efficient. Our approach is straightforward and effective, ensuring that every client receives a personalized service that truly meets their needs.

Our digital agency is committed to using the latest data and technology to help your business stand out. Whether you're looking to increase your online visibility, connect better with your audience, get more leads, or grow your online sales. For more information, read our Digital Strategy Blog or to start your journey with us, please feel free to contact us.

CodeDesign is leading:
- Digital Agency
- Digital Marketing Agency
- Digital Ecommerce Agency
- Amazon Marketing Agency

Feel free to contact us to see the unprecedented growth of your business.

Feel free to contact us to see the unprecedented growth of your business.

Add comment