Marketing the Future of Sleep with Casper CEO Philip Krim (original) (raw)
Based in New York City, Casper Sleep exploded onto the scene in April 2014 with a unique direct-to-consumer foam mattress business. It all started with a serious bang, selling 1millionworthoftheir“outrageouslycomfortable”mattressesinthefirstmonth.Sincethen,thecompanyhasreceivedseveralroundsoffundingfromoveradozeninstitutionalandcelebrityinvestorslikeAshtonKutcher,LeonardoDiCaprio,AdamLevineandSteveNash.ThelastroundoffundingcameonCasper’ssecondbirthday.Whenthedustsettled,Casperwasleftwitha1 million worth of their “outrageously comfortable” mattresses in the first month. Since then, the company has received several rounds of funding from over a dozen institutional and celebrity investors like Ashton Kutcher, Leonardo DiCaprio, Adam Levine and Steve Nash. The last round of funding came on Casper’s second birthday. When the dust settled, Casper was left with a 1millionworthoftheir“outrageouslycomfortable”mattressesinthefirstmonth.Sincethen,thecompanyhasreceivedseveralroundsoffundingfromoveradozeninstitutionalandcelebrityinvestorslikeAshtonKutcher,LeonardoDiCaprio,AdamLevineandSteveNash.ThelastroundoffundingcameonCasper’ssecondbirthday.Whenthedustsettled,Casperwasleftwitha555 million valuation.
Experiential marketing has been at the core of the company’s strategy since the beginning. Over the past two years, major cities across North America and Europe have seen a Casper invasion in the form of nap-mobiles, nap pods and pop-up locations offering potential customers a chance to experience their beds, pillows, sheets and most recently doggy beds.
Casper co-founder and CEO Philip Krim is championing the Casper story in the public eye. He made his entrepreneurial start as a sophomore at the University of Texas, building e-commerce websites selling, amongst other things, mattresses. In the midst of the company’s latest marketing blitz in Toronto, we had a chance to sit down with Krim to chat about the Casper story, their unique marketing strategy and the company’s next moves.
Casper has become an overnight darling of the tech community, but it sells beds. What is it about Casper that has been so viral in the tech community?
I think we are lucky that we have a lot of great pockets of customers, and certainly within the tech community. We definitely count them as some of our earliest adopters and some of our biggest fans. I think technology is core to our DNA and core to the business that we’ve built. It allows us to have meaningful one-on-one conversations with customers, but to do that at scale. None of that would be possible if technology wasn’t core to our business and the business model. I think that has resonated a lot with customers, certainly in the tech community. I think we gained some early visibility there based on some of our investors coming from the tech community.
We certainly continue to, I think, offer an incredible customer experience and fortunately our customers, tech folks and others, have been very vocal with sharing their casper experience online. Whether that be through social media, email or whatever that may be, I think the biggest reason we’ve grown so quickly is that our customers have loved the experience and shared it way beyond our expectations, so that’s been awesome.
You have been running pop-ups in cities across North America. Who is showing up? Are they fans or mostly new customers?
It’s everything. It’s people who have wanted to lay in the bed but haven’t pulled the trigger yet. It’s people who bought the product and just wanted to stop by and say hi. We have people driving by, rolling down the window asking what we are doing. The turnout has been amazing–we’ve been in dozens of cities now and I think Toronto my be our best turnout yet. It’s hundreds of people a day. It’s really awesome.
Why Popups? You mentioned in 2014 that pop-ups were an experiment. It’s now been 2 years of testing – what are the results?
We keep getting different ideas. We love offline. Since we launched the business we’ve loved off-line as a component to the business and it really start organically. The day we launched on April 22, 2014 we had customers knocking on our door wanting to try the bed so we quickly converted the back third of the office into a bedroom, and now that’s a dedicated showroom in New York City on Bond Street; we have a popup that’s running in Venice on Abbot Kinney; we have mobile nap-mobiles going on tours to different cities offering people the ability to come on try and Casper mattress; we’re doing new concept pop-ups like the snooze room. All of this forms an idea of how we want to interact with people. They are all very different than what’s been done before and we’re just going to keep doing more things offline and continue to invest in more markets and do more local things. We think it’s an awesome part of our business and brand.
Is this a long-term strategy or is it leading to some end?
I think experiential is a long-term part of our business and a long-term strategy. I think there will be things that are more permanent and things that will be more temporary but we just want to do more offline and do more where we can interact with customers face-to-face. We love that and think it’s awesome to talk to customer to get their feedback, to see what’s exciting to them and just offer an experience thats totally unique and hopefully fun.
Fun?
Fun is key.
You mention the one-on-one connection that Casper maintains with its customers. Following Casper on social media feels like following a friend which is a bit unconventional but it’s obviously working. Where did this strategy come from?
Having a brand that really connects with people on a deeper emotional level was really important to us since we had the idea for Casper. Part of that was the kind of the voice that we created through social media and we’ve just loved it. It’s really evolved into its own persona and we think it embodies the core of the Casper brand and people love interacting with it.
1. Sleep in tomorrow
2. Tweet us you’re late
3. We’ll tweet you a note to give your bosshttps://t.co/sjVRkJJopA pic.twitter.com/ShgmPenHxk— Casper (@Casper) July 20, 2016
We’ve always taken a very long-term view to the customer relationship. We’ve never viewed it as a transactional relationship where we try to get you to buy right away then never speak to you again. We always wanted to have a relationship with the customer … we do a lot of one-on-one content, we do a lot on social media and all of that is so we can have an ongoing dialogue and conversation with the customers. We now give you the ability to talk to us directly through texting, live chat, email, phone calls and certainly through other mediums like social as well.
You’ve been forthright about focusing on additional variables that affect sleep like sound, light and temperature. As a company who presumably wants to own your bedroom, there is a lot more to go after. How are you addressing these variables with upcoming products?
We are working with a couple of companies around potential partnerships that would impact some of those variables. The one that we’re mostly focused on from a product design standpoint is temperature. You see that with our pillows and our sheets, and will be launching other products later this year that also impact temperature.
Can you share the launch dates?
We don’t have a firm launch date, we haven’t announced what the products are but just to say that we are going to keep rounding out the ecosystem so that everything works together, everything helps regulate temperature the best, regulates airflow the best, and all of that helps optimize the climate in your sleep environment and that’s critical. Things like light and sound are also really interesting. We think there are some really interesting partnerships to be had there and are things that we are working on, but we’ll have to see what the final product is. At the end of the day it all has to work together to create the optimal environment and if you do that you will get a great night of sleep every night.
Every mattress brand makes different mattresses for different people. Are you working on different Caspers?
Everyone sleeps a little differently but the latest and greatest in material science means that you can use materials that are adaptable, that are dynamic so they change to support different body types, body weights and pressure points. We set out to build, and I think proved, that you can build one mattress that is universally comfortable for everyone.
I love the sleep data I can get with the tech available to me now, but I don’t want to wear tech to bed or sleep with my phone. That seems like an obvious invitation to enter the sleep-tech space. Is sleep tracking on the roadmap?
We have more issues than solutions today with what’s out there. We agree – you don’t want to be actively thinking about sleep and having to think about telling something that you are falling asleep. I think our biggest issue is that you have all this data but what do you do with it? There’s no real kind a proactive way to take what you’re learning. We like to think about the space, we like to think about what the solutions are, but I don’t think we know what those are yet and we don’t think anything on the market today is really close to what the right solution is.
Sleep tracking is great on one hand because it’s elevating the mindfulness that people have around sleep. One of the big trends that’s happening is that sleep is experiencing a cultural move. We think it’s a secular change with how people think about a healthy life.
You saw Nike usher-in active lifestyle and exercising. You saw companies like Whole Foods being a real catalyst for healthy eating and knowing where your food comes from. We think sleep is the next big cultural movement and Casper is hoping to become a pillar of that healthy lifestyle.
We can thank people like Arianna Huffingtion for that and sleep trackers are another thing we can thank for that. The more things our there that are bringing sleep top of mind the better off the world will be.
Accounting to Change The World with FreshBooks CEO Mike McDerment
You have a lot of competitors in this spaces, selling what appears to be a very similar product in the exact same way, but you are dominating the space. How are you winning?
I think there are three things that are intrinsically unique about us. I think it starts at the product. Our product engineering team is full of really brilliant industrial designers and engineers and we set out since the day we started with Jeff (Chapin) leading the initiative to build the best-in-class product. We don’t think any company, start up or traditional incumbents, has a product development team that can hold a candle to our team. We have, and will continue to design, engineer and take to market new products that are best in class. They produce the best night of sleep possible and we’re really building the ecosystem around sleep.
The second thing that is intrinsically unique is the brand. People just love the brand, they love the experience and I don’t think there’s any company in the mattress category, or otherwise, that has such a great brand affinity with a customer base. Customers love interacting with us. The pop up that we did in Toronto–it had an unbelievable turnout and it’s just because people love everything to do with Casper. The love following us and social media, etc. So I think the brand is a major differentiating factor and will continue to be.
Third thing is the awesome customer base. I think we are the largest by far of the newer direct-to-consumer business models. There are other ones out there like Dollar Shave Club or others like that but this ability to really have a brand new business at scale that is direct-to-consumers is uniquely beneficial to us in this category because it means we are getting real-time feedback from our customers. We’re able to iterate on product design and we’re able to evolve products and how we construct them. We couldn’t do that if we didn’t have direct relationships with our customers. And manufacturers traditionally in this space and have never done that.
You mentioned Dollar Shave Club, which has a similar model and just sold to a major manufacturer. Is that something you are looking to do with Casper at any point soon?
We think there’s a huge opportunity in front of us. Sleep is really such an important category and there’s no brand that stands for sleep so we really want to build the world’s first global sleep brand and I think we are in the very earliest of innings with that. We have a really big vision for that, for the company and the brand we want to build, so we’re gonna continue to stay focused on building that.
What’s next for Casper?
For us our goal is to be the first brand that you think about when it comes to getting a better night sleep, and there’s a lot of products that can impact that. Another way to think about is when you get the keys to your apartment the one thing you need is a mattress (and hopefully a proper sleep set up) and so we really want to round-out some of those offerings and so we’re going to continue making the customer experience as delightful and easy as possible. We still have a lot of work to do there.
This interview has been edited and condensed for clarity.