ATLANTA — “Consumer-focused innovation” will drive success at a revamped Serta Simmons Bedding, according to CEO David Swift.
The company will employ “radical simplification” in its product lines to “make it easier for consumers to understand the products we offer,” he said.
For example, the new Serta iComfort line, which was introduced at the recent Las Vegas Market, features only four models, less than half the number in some previous flagship line launches.
That line received an enthusiastic reception in Las Vegas and is solidly positioned for success this fall and next year, SSB officials said.
In an exclusive interview with Furniture Today, his first major trade interview since he assumed the CEO role earlier this year, Swift talked about the extensive changes that SSB has made this year, including the opening of a new corporate campus at Doraville, an Atlanta suburb, where the flagship Beautyrest and Serta brands are now both based.
SSB has developed a new structure to make decisions more quickly, a necessary move in a rapidly changing industry, Swift said. The new headquarters promotes that process by bringing all of the company’s key executives to one place, largely eliminating “silos” where teams operated less collaboratively, he said.
Swift does not have the high profile of his predecessor, Michael Traub, but he’s winning praise from bedding insiders for his calm, straightforward approach to the business, one that he nurtured years ago with studies at prestigious universities, including two Ivy League schools.
He holds a B.A., with honors, in physics and mathematics from Amherst College, received a master’s degree in engineering from the Thayer School of Engineering at Dartmouth and has an MBA, with honors, from Harvard Business School.
Before being named CEO of SSB in April, Swift was executive business partner at Advent International, SSB’s owner, a role he had held since August 2014. He retains the title of chairman of SSB.
His previous business experience included a stint at Whirlpool Corp., where he held a variety of senior management roles, most recently as president and a member of the board.
Swift said the changes at SSB, which included the layoffs of more than 160 employees, several of them bedding veterans who were well-known in the industry, were necessary for SSB to right-size its business and to bring in executives with new skill sets who can anticipate industry changes and quickly capitalize on them.
“This is far from a sleepy industry,” Swift said. “I’ve never seen such transformation in an industry in such a short period of time.”
He said online mattress retailer Tuft & Needle, acquired late last year, “is working out really well.” He described the T&N executives as “a scrappy team” and said the company was profitable from the day it was acquired.
Swift said the research he’s seen suggests the online mattress category is nearing a peak. He believes that up to a quarter of consumers would be willing to buy a mattress without seeing it or lying down on it first. That is about the number of consumers currently buying mattresses online, according to industry studies.
He said a growing number of consumers are going online before they shop for a mattress, and he noted that they are highly motivated by mattress reviews. That’s one of the reasons that SSB will be introducing simplified product portfolios: to make it easier for consumers to keep up with those lines online.
New e-commerce-enabled Serta.com and Beautyrest.com websites are due to be launched by the end of the year, Swift said.
He also addressed industry speculation about SSB’s future, including one analyst’s report in July that said SSB “may need to file for bankruptcy protection in the near future.” That report cited “heavy debt loads” at SSB and the upcoming loss of business at key customers.
Swift said SSB “does not have a liquidity issue. We have what we need to move forward.”
He said the idea of a Chapter 11 filing in the near future is “a bunch of baloney.”
SSB is building out its capabilities in each of its organizations, Swift said. Key executives include a mix of “fresh new talent and legacy players,” he said.
For example, Derek Miller, named chief sales officer earlier this year, is an SSB veteran, while Melanie Huet, chief marketing officer, came from outside the industry and gives the company “breakthrough” new marketing capabilities, Swift said.
A pleasant surprise in his tenure as CEO has been learning about the “incredible experience” of the Serta licensees, he added, noting that those licensees are strategic partners who will help the company determine SSB’s future direction.
A student of history, Swift said he takes inspiration from leaders such as Abraham Lincoln, whose leadership skills were showcased in “Team of Rivals,” the best-selling Doris Kearns Goodwin book, and John F. Kennedy, whose vision of a journey to the moon was realized later that decade.
