Can Brand Positioning Save Eve Sleep?

Most humans spend something like a third of their life asleep. That ideal eight hours of rest per night certainly adds up and, unless you’re a traveling salesman or a pop star on tour, there’s a good chance you’ll be returning, night after night, to the same trusty mattress.

So, it’s no surprise that consumers like to really weigh up all their options when purchasing one — a process that can take up to two weeks, in fact — and once they’ve got it, unless there’s a problem with it, they’ll likely hang on to it for nine to ten years!

Thus, mattress brands have a unique relationship with consumers — their products are probably going to be used way more than our cars, our sofas, or our high-definition TVs. But unlike these products, they only really need to be good at one thing: getting us to sleep. And if they achieve this, it’s unlikely consumers will even think about their mattress again for another decade at least.

Because of the challenges that mattress brands face in engaging consumers and building long-lasting relationships that can persevere through their product’s long lifecycle, there are some really useful branding lessons we can take from them. Also, it’s an industry that has been disrupted by a host of hyped-up challenger brands that have vowed to shake things up and take the industry into the future — only for many of them to falter as they fail to live up to their lofty promises.

So in this brand deep dive, we’re going to delve into a well-known mattress brand that represents the modern mattress market — which means it's embraced eCommerce, while still keeping one foot firmly planted in the world of traditional retail — and see what we can learn from its story. The brand in question: Eve Sleep.

First things first, let’s map out the history of this brand.

Stirring The Mattress Sector From Its Slumber

Founded in 2015, Eve Sleep was created with the intention to shake up a sleepwalking industry and offer consumers something different. Co-founder and CMO at Eve Sleep, Kuba Wieczorek explained, “I thought about our competitors and how they were marketing their products… Everyone was doing much the same thing. We decided to do things differently.”

That different approach to the mattress industry came in the form of a “revolutionary memory foam mattress” that could be ordered online and delivered in a box. Designed to adjust to the sleeper’s body while keeping them cool, comfort was the principal consideration. But even with a product its founders truly believed in, they still faced the uphill struggle of waking consumers up from their usual habits and getting them on board with Eve Sleep.

But the team behind Eve Sleep was well-equipped to face the challenges of bringing a disruptive new product to the market. As well as Kuba Wieczorek, a marketing and branding whizz who’d captained Channel 4’s in-house creative agency 4 Creative, there was Jas Bagniewski, former head of Zalando UK, Joe Moore from accountancy firm Deloitte, and James Fryer, a veteran of the mattress industry.

Wieczorek took the lead on building Eve Sleep’s brand and sought to set it apart from the competition by positioning it as a “cool lifestyle brand”. He explained:

“When I looked at other mattress providers, they based their messaging either around sleep or functionality… I took a different approach by focusing on the benefits of sleep. The idea that every great day starts with a good night’s sleep.”

The Dream Comes True

Eve Sleep’s dream to shake up the market became a reality as its brand launched and made an instant impact on consumers. Within just six months of its launch, the brand was on track for £1m in sales for its first year.

Its initial marketing strategy focused on Google Adwords and led customers to a website optimized for conversion, where every feature was “beautifully simple.” In order to really put their brand on the map, they decided to branch out into other channels — particularly social media and OOH advertising. They invested in a huge poster campaign targeting London and saw their brand awareness shoot up from 1% to 14%.

Two years after the launch of Eve Sleep, the brand was taken public in an IPO that sought to raise funds for a massive European expansion and accompanying investment in their advertising and marketing. The move was a success, allowing Eve Sleep to successfully raise £35 million, valuing the company at £140 million.

To some analysts, it appeared that the dream was set to never end, with Eve envisioned “as the only real pan-European player in the e-commerce sleep market.” Many felt that it was “easy to see how Eve could soon own the sleep category, be the go-to brand for everything around sleep.”

But bad dreams, perhaps even nightmares, were on the horizon.

The Dream Becomes a Nightmare

In the year that followed Eve’s IPO, the brand achieved strong growth, with sales jumping up “132%” to a value of £27.7 million. But despite this massive growth, the brand posted massive losses — as high as £19 million. In 2018, the impressive record of growth also began to slow, with only 61% achieved, rather than the 100% that had been anticipated.

Investors were spooked, and following the announcement, the brand's share price took a massive plunge — dropping 60%. CEO, Jas Bagnieowski, stepped down from his role and Eve refocused its efforts on key markets in the UK and France rather than expanding into multiple new territories. The brand also entered into a partnership with UK bed retailer, Dreams, to sell its mattresses in 193 of its stores.

By 2020, Eve’s share price had only fallen further, losing 98.5% of its initial value since floating — something which was blamed on “competitors cutting prices and low consumer confidence.”

Their fate, alongside the turbulence experienced by other challenger mattress brands, caused some commentators to question whether these brands were equipped to actually live up to their promises. In their mission to completely dominate the market, brands like Eve Sleep, Casper, and Simba had to “outspend” their rivals on marketing.

Dan Coatsworth, a stock market analyst at AJ Bell, painted a dreary picture of their prospects. He explained that “mattress brand loyalty is likely to be very low… Consumers will no doubt accept any product as long as it is comfortable and the price is right.”

From his perspective, the long lifespan of the product really undermines the value of loyalty. While other D2C brands can spend huge sums of money on customer acquisition, their subscription model and regular reorders create ample opportunities for that initial investment to be won back. But Eve Sleep was spending 54% of its revenue on customer acquisition and winning just a single transaction.

Time To Wake Up?

In response to the challenges of the market, Eve Sleep took another look at its brand and started to make changes. While the eCommerce model had worked well, trying out mattresses before buying was still very important to consumers, so they expanded their brick-and-mortar retail presence by adding department stores, Debenhams and Next, to their list of partners.

With Cheryl Calverley as CMO, Eve Sleep began to redefine exactly what type of brand it was — not a mattress brand, but a “sleep wellness brand” eager to ensure that it had “more than a ‘one-night stand’ relationship with customers by talking about the importance of sleep and selling more than mattresses.”

In her own words, Calverly admitted that “we will not be successful if all we are is a mattress brand, there are a million of them and you can get a perfectly good one anywhere; it’s a dog fight. There has to be much more to our offering,”

To signal the change to consumers, Eve Sleep invested in an ad campaign to mark World Sleep Day on March 13th. Airing at 9:45 pm, the 90-second ad functioned as a “relaxation film that featured adults, a young child, a baby and a puppy enjoying a good night’s sleep.”

The shift came with positive revenue and profit figures, with Eve Sleep posting an 11% increase in revenue, despite a 40% decrease in marketing spend over a two-year period.

Despite a strong start to the year, in June of 2022, the company put itself up for sale in an attempt to fund its future as the first “digital sleep wellness retailer” and to help it overcome the challenges of a market struggling with low consumer confidence and rising costs.

At the time of writing, it’s yet to find a buyer, and unless things improve, it looks like one of the mattress category’s most promising brands could be set to take a slumber from which it won’t wake.

3 Lessons We Can Learn From Eve Sleep

So now that we know the story of Eve Sleep and the trials and tribulations the brand has faced over the years, let’s break down some of the biggest branding lessons that you can learn from it that might apply to your own brand.

1. It’s All About Positioning!

How you position your brand can have a massive impact on how audiences perceive your product and offers, can affect consumer purchasing decisions, and influence the type of relationship your brand forms with customers.

Eve Sleep really helps to demonstrate how important brand positioning is. Early on in the brand’s history, its messaging focused on its product but positioned Eve as a “cool lifestyle brand” rather than relying too much on the technicalities of its mattresses. This positioning gave Eve Sleep license to theme its messaging in a more upbeat and lively way compared to the competition.

The challenges of the marketplace forced Eve Sleep to rethink this positioning. In a bid to strengthen and lengthen the relationship that consumers have with its brand, it repositioned itself as a sleep wellness brand, diversifying its offering in order to capture repeat purchases.

The Takeaway: Positioning can be vital, particularly for emerging brands as they figure out who their target audience is or attempt to grow their appeal from niche segments to the mass market. Challenger brands have a wealth of different positioning strategies that they can adopt — from posing as the irreverent maverick of a particular category — like Brew Dog or Dollar Shave Club — or taking on a missionary role as an activist brand.

Your strategy should always be informed by tracking your own brand’s performance and performing market research — this should give you useful insights into how your competition is faring and where the biggest opportunities can be found in the market.

2. Understanding Customer Behavior and Market Size Is Vital

The story of Eve Sleep and how it repositioned its brand to adapt to the challenges of the market also demonstrates another important brand lesson — your decisions should be informed by your understanding of customer behavior and the market within which you’re competing.

Getting insights into your brand performance, into the lifecycles of customers and the average value they bring — against the cost of acquiring them in the first place — is not just useful for optimizing a sales and marketing strategy, but can also inform the identity of your brand and the tone of its messaging.

The Takeaway: Eve Sleep’s realization that its survival relied on its being more than a mattress brand was likely fueled by data and insights into the market and its performance.

These insights then directly influenced the direction it took in its brand. This is the right way to do things. Just as other parts of a business are influenced by data and performance KPIs, so should your brand strategy! Don’t leave it up to chance and build your strategy by relying on the same data the rest of your marketing and sales team are using.

3. Activate Consumers With Advertising

While the lifecycle of a mattress is much longer than most other products, that doesn’t mean your brand should simply rest on its laurels and wait for consumers to activate themselves. Eve Sleep, like many other mattress brands, has used advertising not just to raise awareness, but to convince consumers it's time to give their old mattresses up.

Eve’s “8 Signs You May Be Sleep Poor” uses humor to target consumers who just aren’t getting enough sleep, making the compelling case that they might need a new mattress.

Focusing on poor sleep and discomfort is a clear strategy that many brands employ in order to activate consumers who may not have actually had their mattress longer than the average lifespan, but may be susceptible to advertising and activation earlier than anticipated.

The Takeaway: Industries absolutely have the power to influence how consumers perceive a particular product and can change customer behavior through positioning and advertising. Just think about the commonly held notion that an engagement ring should cost 2 months’ salary. Guess who started this trend? That’s right, De Beers diamond company.

At first, their advertising suggested a single month’s salary was the norm, but by the 80s this had risen to two months. Their campaign was a roaring success that influences consumer behavior to this day. Before the 1930s, only 10% of engagement rings contained diamonds, by the end of the 20th century, that figure had jumped up to 80%.

Remember that your brand has the power to change how consumers perceive a particular category — whether that means shortening a product’s lifecycle, increasing the average spend, or encouraging the purchasing of other accompanying products.

Final Thoughts

Eve Sleep, alongside other disrupting brands within the mattress category, such as Casper and Nectar, certainly made their mark on the industry and the result is that consumers have more choice than ever.

But the rush to shake up the mattress industry and the battle for one brand to completely dominate it, has, for the time being at least, ended in stale-mate — with many challenger brands retreating or repositioning after overextension, while traditional ones now find themselves with new adaptations for the modern market.

In this challenging, crowded marketplace, brand is more important than ever — marketers and brand managers need to ensure that they understand their relationship with consumers and leverage all the tools at their disposal in order to build loyalty and grow. If they don’t, they could find themselves abruptly woken from their dreams of success in the mattress industry.