Sleep Number Corporation (NASDAQ: SNBR) is a sleep innovation leader that delivers unparalleled sleep experiences. Thirty years ago, Sleep Number transformed the mattress industry with the idea that ‘one size does not fit all’ when it comes to sleep. Today, we provide consumers with high quality, individualized sleep solutions through our complete line of Sleep Number® beds and bedding. Based in Minneapolis with 4,000 employees and 550 U.S. stores, our revenues in fiscal 2016 were $1.3 billion.
We are the exclusive designer, manufacturer, marketer, retailer and servicer of a complete line of Sleep Number® beds and bedding. This vertically integrated business model allows us to provide a seamless end-to-end customer experience. Unlike traditional mattress manufacturers that primarily sell through third-party retailers, more than 98 percent of our net sales are directly to consumers.
Our innovative products deliver higher quality sleep, validated by third-party consumer satisfaction awards – and our own research. The benefits of our proprietary Sleep Number bed have been validated through clinical sleep research, which has shown that participants who slept on a Sleep Number bed generally fell asleep faster, experienced more deep sleep with fewer disturbances and experienced greater relief from back pain than those sleeping on a traditional innerspring mattress. In addition, only the Sleep Number® bed offers SleepIQ® technology — proprietary sensor technology that works directly with the bed’s DualAir™ system to track and monitor each individual’s sleep. SleepIQ® technology communicates how you slept and what adjustments you can make to optimize your sleep and improve your daily life.
The company’s presence has evolved from a small kiosk in a mall in Roseville, Minnesota in 1992 to a retailer with a national store footprint and products exclusively sold through Sleep Number® stores and sleepnumber.com. Our average sales-per-square foot is in the top 10 among U.S. specialty retailers and is driven by a differentiated store experience and modern store design.
As we have transformed our company to stay ahead of consumer trends, technology and the competitive landscape, we have held onto our longstanding tradition of acting with integrity and keeping the customer at the heart of our decision making. For the second year in a row, Sleep Number was named in 2016 to Forbes’ annual list of the 100 Most Trustworthy Companies In America. Forbes’ researchers screened more than 2,500 publicly traded non-financial American companies with market caps of $250 million or more to identify the 100 that most “consistently demonstrated transparent accounting practices and solid corporate governance.”
SleepIQ® technology integrated into the bed tracks a person’s sleep, offers insights and makes suggestions to help people achieve the best sleep of their life. Touch-free, biometric sensors track the sleeper’s whole body hundreds of times per second (heart and breathing rates, presence and restfulness).
Based on individual SleepIQ® data, the technology learns the person’s routine and uses adaptive algorithms and predictive modeling to recommend adjustments to daily habits and environment. The SleepIQ® API (Application Program Interface) can connect to an individual’s other cloud services and track items important to them – including exercise, nutrition, environment, temperature, schedules and individualized comfort – every day and night so people can be smarter about their sleep.
Research shows that customers who adjust the firmness of their bed – their Sleep Number® setting – are 58 percent more likely to have improved sleep quality as measured by restful time in bed using SleepIQ technology to track and optimize their sleep.
In September 2015, we completed the acquisition of BAM Labs, Inc., the Silicon Valley pioneer of biometric sensor and sleep monitoring. The acquisition strengthened our leadership in sleep technology with unprecedented data and connected product capabilities. We had partnered with BAM since 2012 to develop and commercialize SleepIQ® technology. BAM now operates as SleepIQ® Labs. The deeper collaboration of our teams has resulted in acceleration of our innovation pipeline, efficiencies in our product development cycle and our ability to deliver meaningful consumer benefits.
SleepIQ® technology generates more than one billion biometric data points a night and facilitates daily interactions with customer data and insights to inform decision making and product development. This biometric data advances smart, connected products that empower our customers with the knowledge to adjust for their best sleep.
At our 550 Sleep Number® stores in 49 U.S. states, we offer an interactive, educational experience that is distinctly different from other retailers. For the second year in a row, Sleep Number was recognized in 2016 with the Silver Outstanding International Store Design Award from the Association of Retail Environments.
Our modern store design features the complete line of Sleep Number® beds and SleepIQ® technology. With the help of a Sleep Professional, customers experience IndividualFit® 3-D Imaging, a digital map that displays the body’s pressure points. Starting with a firm mattress, customers watch the pressure dissipate as the bed adjusts to their body to alleviate discomfort and find their Sleep Number – the ideal setting for a better night’s sleep. Sleep Professionals listen and guide shoppers to the right solutions that help them know better sleep, including bedding solutions to address common sleep problems like allergies and temperature swings and the PillowFit® experience that helps customers find a pillow that perfectly fits their needs.
Our retail strategy integrates our physical and digital Sleep Number experience. Within our physical stores, our average sales per full-time employee are 50 percent higher than other top U.S. specialty retail brands. The digital Sleep Number experience focuses on engagement with new customers and deepening relationships with existing customers. Elements of our store sales process are built into the digital experience to improve consumer research and conversion. We continue to advance the productivity of sleepnumber.com, where customers learn about our products, find their nearest store location and purchase online.
Sleep Number has evolved from a 1-800 direct marketing mattress company aimed at helping people with back pain, to a national consumer lifestyle brand with technology as our differentiator.