Sales are soaring at online mattress retailer Tuft & Needle thanks in part to Google Inc. marketing campaigns.
The retailer started working with Google in the fourth quarter of 2015, producing several mobile campaigns with the search giant throughout the year plus a video campaign on YouTube, says Ajay Kandala, digital marketing lead at Tuft & Needle.
Sales have increased 150% year over year, as the retailer is on track to hit $100 million in sales in 2016, up from $40 million in 2015, Kandala says. While Kandala can’t attribute all of Tuft & Needle’s sales growth to Google, he knows it was a large contributor. Tuft & Needle sells its mattresses online and through two showrooms that do not carry inventory; mattresses are shipped directly to consumers.
When a consumer buys a mattress it typically requires a lot of research. Often, a consumer uses her smartphone in free minutes during this research phase, so Tuft & Needle wanted to boost its presence on mobile search results, Kandala says. Google tools helped Tuft & Needle identify the top 10 cities in which demand for buying a mattress was high, based on search volume in those geographic areas, and where brand awareness of Tuft & Needle was low, also based on Google search volume of the retailer.
Targeting those mobile consumers with display ads via Google’s Display Network, traffic to Tuft & Needle on the mobile web increased 14% between March and October. Mobile sales increased by 22% compared with the same time period last year, Kandala says.
Tuft & Needle also produced a pre-roll ad on YouTube to those targeted consumers, which increased sales by 26%, he says. Pre-roll ads appear before an online video begins. The retailer attributes the YouTube ad to increasing traffic to its website, and those shoppers then made a purchase.
60% of the e-retailer’s marketing budget is allocated to Google, Kandala says. Tuft & Needle also markets via ads on TV, radio, billboards and Facebook.
The retailer considers all of its sales online. If a consumer makes a purchase in one of its two locations—one in Phoenix and one in San Francisco—the retailer categorizes the purchase as online with the referral coming from bricks and mortar.
Tuft & Needle has 130 employees, up from 10 in 2012. The retailer has been profitable since year one, Kandala says.
By comparison, online-only mattress retailer Casper (No. 290 in the Internet Retailer 2016 Top 500 Guide ) generated $85 million in sales in 2015, according to Top500Guide.com, and 1800Mattress.com (No. 448), had online sales of $36.5 million in 2015, according to Top500Guide.com.