Online resource is tool for shoppers—but also manufacturers and retailers
BY DOROTHY WHITCOMB
Michael Magnuson is a man with a mission. Magnuson is the founder and chief executive officer of Revv Media LLC, which publishes GoodBed.com, a multifaceted, online mattress review site designed to demystify the process of buying beds. Magnuson’s goal, he says, is to leverage the power of the Internet not only to transform the way people buy mattresses, but also to create a cycle that boosts sales for manufacturers and retailers and, ultimately, improves product quality.
Prior to founding Revv Media, Magnuson was a principal of Waller Sutton Capital, a New York-based private-equity firm that focuses on media and communications companies. While there, he developed and led the firm’s marketing services practice and became particularly interested in acquiring vertically oriented digital media properties.
Any consumer who has spent time online researching a potential purchase is likely to have used a vertically oriented site: Those planning a vacation head for sites like TripAdvisor.com, house buyers consult Zillow.com and car buyers seek information from Edmunds.com.
“These are media companies because they provide information to consumers, but they’re also marketing channels,” Magnuson says. “What these sites do for consumers then powers the services they offer to business clients.” Sites like these outperform generalized sites, he says, because consumers invariably choose specialized information sources when they exist. Magnuson’s problem as an investor was that “beyond the top categories, the field thinned.”
|Specialty||An online mattress review and information resource|
|Mission||“GoodBed will make it easier to choose the right bed from the right store at the right price.”|
Magnuson was looking for sites that provided information to hard-to-reach consumers in a targeted way at a particular time in the buying cycle. “Reaching these consumers is especially valuable if the purchase is a sporadic one like mattresses,” he says.
Frustration leads to innovation
Magnuson’s interest turned from professional to personal when he and his wife set out to buy a bed.
“It was our first real mattress, and the process was frustrating and confusing,” he says. “It was hard to get information we could trust or feel that we weren’t being taken advantage of. It was so painful that we just kept procrastinating.”
Surveying the Internet didn’t help. “I couldn’t find any mattress site that was worth investing in, so I just filed the idea away,” Magnuson says. Four years later, after founding his own San Francisco-based private-
equity firm, Westward Capital Management, Magnuson revisited the idea and began experimenting with a way to help consumers buy mattresses with confidence.
“I hung up a website in 2008 called Best Bed Guide that was strictly articles on how to buy a bed and the pros and cons of different types of beds for different people. We added on a database of retailers and a store locator. I had people go out and find out information about brands and then models within brands,” he says. “When we layered on the ability for people to leave reviews, we started to get real traction. When we had half a million people a year coming to the site, we knew we were on to something.”
With the value of his experiment proven and with the support of private equity, Magnuson, who is the majority shareholder, began to focus all of his efforts on further developing the site. He was determined to create “an unbiased, reliable platform that makes mattress buying easier and helps people to make better choices.”
Powered by people’s reviews
Consumer reviews are the beating heart of GoodBed.com, the official name since 2011. To date, company officials say, more than 10,000 detailed mattress reviews and ratings have been posted.
“We moderate the site very closely. After passing through several filters, every single review is approved by a real person,” Magnuson says. “We want real owners, not fake reviews or reviews by people in the industry.”
Jeff Cassidy, vice president of business development, adds: “We notify the manufacturers or retailers when reviews come in, giving them a chance to respond and engage with their customers. We also collect consistent and detailed information about each reviewer’s preferences so that we can correctly assess the relevance of one consumer’s experience to another’s.”
Collecting that information has created a deep database. GoodBed has hosted more than 6 million unique shoppers, 60% of them women. These shoppers, generally 30 to 60 years old, are interested primarily in queen- or king-size beds.
The good news for the 400 manufacturers, 9,000 retailers and 27,000 store locations listed on the site is that “95% of these shoppers are actually deciding which mattress to buy and looking to spend upward of $1,000,” Magnuson says.
Connecting manufacturers and retailers to these active shoppers is at the core of GoodBed’s business plan. “Ultimately, we want to make our money creating a win-win by connecting a consumer with a product and a retailer that’s right for her,” Magnuson says.
GoodBed offers manufacturers and retailers several ways to reach customers. The most basic—and free—option is to claim their profile. Although the site includes information about individual manufacturers and retailers, “claiming” a profile allows companies to post their own information about their businesses and products.
To date, about 1,000 manufacturers, retailers and store managers have claimed profiles, Cassidy says. A claimed profile receives an email from GoodBed whenever a pertinent review is posted. This allows a company to manage its online reputation and start a dialogue with the customer by posting a response to the review. Claiming their profile also allows companies to respond as “Mattress Experts” when consumers post questions about products or services. GoodBed offers a menu of fee-based services that enables industry users to engage more actively with consumers or to profit from the site’s extensive user base. Those who opt for the Enhanced Profile can place videos, images and ads on their pages. They also can purchase ads for placement on other pages on the site.
Another fee-based survey service leverages GoodBed’s expertise with data management to gather feedback on products and services for manufacturers and retailers. Using a manufacturer’s or retailer’s own customer list, GoodBed creates personalized surveys that are sent to customers for feedback.
“Our survey tool saves the consumer from having to enter annoying details so she can move immediately to a series of easy questions about her experience that create the review,” Cassidy says. “This allows us to get feedback from people who are perfectly happy with their mattress and who would not normally take the time to write a review.”
The results from a 2014 survey for a large regional retailer are illustrative.
“They used our survey tool to contact 5,000 randomly selected customers who had bought queen- or king-size beds in 2013. Prior to the survey, the brands they carry had a combined average rating of 2.2 stars. The survey reviews registered an average of 3.8 stars. Nearly 20% of the reviewers offered a store review, as well, which averaged 4.0 stars,” Magnuson says. “Previously, this retailer didn’t even have enough store reviews to calculate a meaningful average.”
GoodBed’s newest service allows consumers to order a bed directly through the site, which links them to retailers who complete the purchase. The service is being rolled out with a handful of pilot retail partners. “We take a commission when a customer buys a bed,” Cassidy says. “But we are agnostic as to what they buy or from whom they buy it.”
Reaching deeper into the industry
Members of GoodBed’s leadership team don’t believe they are anywhere near the finish line when it comes to the development of GoodBed.com.
“We are constantly mining data for insights and poking and prodding it to make sure that the data we are getting is good,” Magnuson says.
They also know they have a distance to travel before the mattress industry as a whole understands and trusts the services they offer enough to make GoodBed an integral part of marketing programs.
“Some don’t really understand the Internet or social media. Others just haven’t yet allocated the time or staff to engage with the site,” Magnuson says. “I suspect there are even companies who know us, but remain wary because they don’t really understand that our interests are aligned with theirs.”
Neither Magnuson nor Cassidy finds these obstacles particularly daunting.
“We hope that in five years, because of the value we are providing for consumers, a top priority for all industry marketing departments will be the feedback they are getting on GoodBed,” Cassidy says.
Magnuson adds: “We want to be able to look around and say that we helped make mattress buying easier, that we helped people make the right choice for themselves and that good companies are getting credit for the good things they do.”