As president of Michigan’s largest retailer of furniture and mattresses, Gardner-White Furniture, Rachel Stewart has seen a lot in the past 9 years—and perhaps especially in the past 18 months.
In this episode, Jeff and Mike talk to Stewart about the digital transformation Gardner-White has undertaken over the past decade, how the pandemic-driven “nesting trend” has changed the way people see their homes going forward, why diversity matters in the furniture industry, and what it’s like to see your largest competitor file for bankruptcy…twice in the same year.
Stewart also shares insights from Gardner-White’s decision to carry both traditional and DTC mattress brands, their innovative strategic partnership with Best Buy, and the personal journey that ultimately led her to join the family business.
Be sure to subscribe to Mike It Up through your preferred podcast platform so you don’t miss an episode.
Rachel Stewart: Hi, I’m Rachel Stewart at MIKE IT UP. Welcome to my get up with goodbed.com. Jeff Cassidy, when that’s the case, it becomes harder just psychologically to make a change and Mike Magnuson, if you’re doing those things, you can be competitive long term. Just when you thought these number crunching data lovers couldn’t get any nerdier they started a podcast and I know this is pretty controversial. This is why we’re having a podcast, right? But if you want to be smart about how the mattress shopping journey is changing, and what retailers and manufacturers should be doing about it. Well, man, have you ever found your people? Because right now it’s time to Mike It Up!
Rachel Stewart: I never really use my cameras. I’m hearing like closer I’m from.
Mike Magnuson: Yeah, I feel I’m feeling. And in both of you guys.
Rachel Stewart: Please remember, I’m a mother of two kids under three.
Mike Magnuson: You look great.
Jeff Cassidy: You look amazing.
Mike Magnuson:Yeah, by the way, did you have a chance to listen to any of the other episodes?
Rachel Stewart: I did. Yeah, there you guys are…
Mike Magnuson:Unintentionally, but yeah it’s funny.
Rachel Stewart: Well, I feel like nerd humor is your jam, which it is.
Mike Magnuson:Definitely, once you accept that premise
Jeff Cassidy: For us that just qualifies is for us. That just qualifies as humor nerds.
Rachel Stewart: Exactly, I can relate.
Mike Magnuson:Right, exactly. Alright, let’s see. So one thing we sometimes forget to do, or at least we’ve only done this three times, but we forgot to do one of three times is an introduction. So I want to make sure we don’t forget to do that in this case. We have our guests here today, well, by the way. Rachel Stewart, do you go by or do you go by your full three now?
Rachel Stewart: I do Stewart. It’s just easier.
Mike Magnuson:Okay, alright. So our guest here today, Rachel Stewart, we’re delighted to have her. She is coming up on nine years had gotten away. Is that right?
Rachel Stewart: Yeah.
Mike Magnuson: Okay. So previously, I just want I like to get a little bit of background on what people did before their current jobs. You were in the government public policy. Is that fair to say
Rachel Stewart: Yeah, I did for a while before so solar energy was my jam.
Mike Magnuson:Okay, was that your jam throughout that time that you were working in like the Clinton initiative and
Rachel Stewart: Clean energy and then moved into solar.
Mike Magnuson: So yeah, got it.
Rachel Stewart: Don’t try me out if you want to land or energy efficiency sellers.
Mike Magnuson:Really, very cool. And we should also mention for those people listening who you know are not near a Gardener-White store, Gardener-White and correct me if I’m wrong about any of these things. Gardener-White is the largest furniture store in Michigan furniture retailer in Michigan.
Rachel Stewart: You got it.
Mike Magnuson:Twelve stores focused around the Detroit Metro area. It was founded over 100 years ago, right? By someone named Gardener and someone named White. I’m gonna go, we’re gonna go—team effort, perhaps. So fill in any other details I’m missing there. It is a family business, correct?
Rachel Stewart: Sure. Yeah. But why would you do it? Why would you do this for?
Mike Magnuson:Yes, I would like to keep inviting it. But you’re enjoying watching me struggle through it with whatever I can remember. So I didn’t want to deprive you.
Rachel Stewart: I appreciate that. You know, we’re a family business, biggest, biggest retailer in Michigan. I’m fourth generation. So I don’t know, what’s the line? We were supposed to be bankrupt in two decades or two generations. But somehow still here. Yeah, it was 1912 in this area. And it’s sort of interesting. When you get into history. There’s so many companies, so many locally based and operated companies. They’re all founded in that general neighborhood. And I think that’s really a reflection of what was happening in the auto industry in Detroit at the time.
Mike Magnuson:Yeah. That’s great. I think it’s awesome to have also, you know, the family connection here, family business connection here, because it’s such something so common in the furniture industry. So it’s great to have that perspective. So one thing we like to do to start things off, if you don’t mind, is a little bit of a lightning round. You get with that, okay.
Jeff Cassidy: Okay. It’s just meant to be fun. Break the ice.
Mike Magnuson: So alright, good. So we’re gonna start it off. And it’s just quick questions. Yeah, have fun with it. No wrong answers. Alright, number one. You have two kids right now, right? Which one’s your favorite? I’m just kidding. Alright, here we go. Sorry. I had to, because we just seem so nervous. But I was gonna ask a tricky question. So I had to just favorite summer activity?
Rachel Stewart: Swimming.
Mike Magnuson:Alright, best music decades for the past 100 years?
Rachel Stewart: You know, it’s so much easier to answer this before you get into the history of the mall. I’m gonna go with the 80s, it was glorious.
Mike Magnuson: Yeah, it was pretty glorious, if for no other reason than the hair. Favorite holiday?
Rachel Stewart: Favorite holiday, Thanksgiving.
Mike Magnuson: That’s a very, that’s a very—I think everyone we’ve asked. It’s an apropos one has that? Yeah. No one, by the way, no one has said Black Friday.
Rachel Stewart: Well, that’s fine. That’s good.
Mike Magnuson:Alright scale of one to 10 how good of a sleeper are you?
Rachel Stewart: Eight.
Mike Magnuson:Solid. Favorite pizza toppings?
Rachel Stewart: Oh, classic margarita.
Mike Magnuson:Oh wow, simple. That is classic. What is something that is a non-condiment that you always have in your refrigerator?
Rachel Stewart: Not much. Yogurt?
Mike Magnuson: Yesterday’s Chinese food?
Jeff Cassidy:Yesterday, that’s very ambitious. Try like, last week, right?
Mike Magnuson: Alright, favorite toy as a kid?
Rachel Stewart: Oh, you know, honestly, I think oh, those big blocks.
Mike Magnuson: Oh, okay. Like the Duplo blocks?
Rachel Stewart: The cardboard ones we all have.
Mike Magnuson: Oh, the cardboard one so you’re making stuff that you can get into? And then knock it? Got it.
Rachel Stewart: There’s more in the demolition.
Mike Magnuson: Got it. Yeah, build it up to knock it down. If you had a walk up song like a major league baseball player, what would it be?
Mike Magnuson:Wow. So like a baseball theme song, right on point. I’m gonna go back and field centerfield. Is there some good reading? Yeah. Okay, sticking with sports since it’s the Olympic year here. In what non-sport activity would you be most likely to win an Olympic medal?
Rachel Stewart: Non-sport? Sales.
Mike Magnuson:Gold Medal for BS goes to Rachel Stewart. Oh, say, alright. What’s something that made you smile recently?
Rachel Stewart: My two year old looks at me, she goes, ‘no, ma’am that’s not for me.’
Mike Magnuson:Got it.
Jeff Cassidy: That’s impressive. Is that something you or somebody says in response to what?
Mike Magnuson: In response to what kind of things all the time just in general like?
Jeff Cassidy:Rachel is trying to sell her furniture?
Mike Magnuson: Yeah. Is that her response to your sales BS?
Rachel Stewart: Let’s not forget moving.
Mike Magnuson:No, that’s funny, though.
Jeff Cassidy:Isn’t it supposed to be the terrible twos? Yours are the polite twos?
Mike Magnuson: Yeah, that’s good,
Jeff Cassidy:Polite, but still, resistant to what? Yeah, but at least it implies it in a pleasant way. It’s good, right?
Yeah. It’s hardly terrible.
Jeff Cassidy: It’s followed by I love you, mom. I love you, but I’m not doing that.
Mike Magnuson: Alright, so alright, let’s start with a little bit of just continuing a little bit on your background. I think it just again, I think it’s interesting, because there’s a lot of people in family businesses and multi-generational businesses in this industry. You essentially grew up in this business. Can you share any of your earliest memories of the business?
Rachel Stewart: Oh, sure. Well, so I think, yeah, so both my parents worked in the business, which I think is pretty unique. So, you know, most early, some people would come home and at least get something of a rest, but not so I think I remember distinctly every dinner conversation was about a marketing campaign. And usually you’d be debating it.
Mike Magnuson: Youngest age remember this?
Rachel Stewart: 100%, absolutely. No, I remember looking at print ads at the dining room table. Absolutely. So I remember I think someone you know, back in the day before everything was digital, you have to drop off the ads to review them and I remember outside an advertising agency, that’s my parents. And of course, you know, my parents were good parents, we felt empowered to express an opinion. So I took it upon myself to express my opinion about these ads at like nine to this guy who you know, like, I hope is going great professional in this space with a ton of credibility. So I do distinct over callbacks, my parents blocked me aside to say why maybe this wasn’t appropriate.
Mike Magnuson:Did you by chance use the words ‘this ad is not for me?’
Rachel Stewart: Maybe
Mike Magnuson: Got it? And what, so now that’s interesting. So how did your relationship with the business then evolve over time? Like from the like, from the time you were nine and being told maybe, maybe your input is better to share with your parents, but not with outsiders like what, how did that how did it evolve over time? Like through high school, college and beyond?
Rachel Stewart: Well, I think you got to, I guess I mean, so what you see at home, which is what your parents are debating is very different from when you’re there, watching it, you know, watching people do their thing. So you sort of moved from learning just from sort of the inside baseball stuff to actually seeing what we do, and really getting a lot of respect for the different areas. And I think, did you have summer jobs? Like, retail part? There’s a lot of moving parts.
Mike Magnuson: Did you have summer jobs with the business as a kid?
Rachel Stewart: I did. I remember I started really young, I’d be filing in the back. And then I remember my first real punishment at some point, I took it upon myself to strip the wallpaper in my bedroom, and paint. You know, reading some books did a decent job, but it was an OK enough job that my punishment was paid in the back office at Gardener-White.
Mike Magnuson: That’s a very fitting punishment. Yeah, we’re going to put these into these painting instincts to good use.
Jeff Cassidy:Could have been a reward actually, too.
Rachel Stewart: I think I actually liked it if I haven’t. Kind of cathartic, yeah.
Mike Magnuson: So now, was it always the plan that you were going to go work in government or public policy? And then come back? No, not always the plan?
Rachel Stewart: No, no, no, I think, no, I think my parents were really smart in that sense of strongly encouraged me to go do other things, have a career, find your path. And I think when I said I was interested in coming back, I think they were more in shock than anything else.
Mike Magnuson: Talk about what led you to that decision?
Rachel Stewart: Well, I think I was at the point where I was going to go into the private sector and clean tech. And then when you really get to it first, you know, the day to day and you’re in the middle in the thick of it. You know, the day to day might sound glamorous, but it really isn’t. And the probability of success is like that big. And I just didn’t feel like I had the big business acumen at the time and you know, independent of anything you’d want to do like, who’s better to teach you that in your parents? So I thought you know, let’s try this one on for size and see if that’s.
Mike Magnuson:Nice. And when you got there, or since you’ve been there? Was there anything that really surprised you? The relative to maybe what you would have expected? The experience would be like?
Rachel Stewart: Yeah, I think retail has a lot of complexities, even in the best status, let alone, you know, when the world is changing, as it certainly has been in the past two years, but always really as. So I think there’s, you know, for retail to work a lot needs to happen, right. And I think that’s the biggest thing that struck me. Yeah, you know, there’s, you know, we sell things, we can be great on a sales floor, but there’s about 80 other things you also need to nail to really grow a business.
Mike Magnuson: Yeah. Let’s talk about, you mentioned how much things have changed in the last couple years? Obviously, part of that relates to the consumer, and, you know, what their experience has been? And how they interface with your store, and so forth? I mean, what can you share about what you like, how you see the consumer journey, having changed over your time in the industry, but maybe in particular, these last couple years?
Rachel Stewart: Well, I think I mean, COVID in particular, I think it’s just, I think we made some, you know, in some sense, I think it’s overblown, but I do think people are just doing their homework or using their things more, they need more functionalities. So I think we’ve seen more interest in really investing in really comfortable durable product. So for bedding that has a huge impact. So that’s, that’s one. Also I just think how we, how consumers, use the web is just constantly changing. And we’ll continue to you know, in the past when I joined I remember the debate of do you put your website in your TV spots? Because why would you direct them to your website and at your store? If they’re already interested in you like now that’s just like, that seems like such an antiquated conversation.
Mike Magnuson:It is crazy. Yeah, that was all in the last nine years that we went from that debate to where we are now where that feels.
Rachel Stewart: Right, with like, why we firstly win, but yet there’s a thanks. Remarkable above that conversation. So I think that’s the biggest and I think, I don’t know that anyone’s really figured out in brick and mortar how to really dance with digital, but I think there’s definitely some clues as to how that evolves.
Mike Magnuson:What do you think in terms of like, the changes that were brought about by the pandemic? Which ones do you think are going to be sticky and actually are going to last? I mean, whether in regard to the demand levels or the way that people shop?
Rachel Stewart: Well, I think this was, this definitely spurred the digital transformation for all consumers. Without a doubt, when you had, you know, so many people over 65 now buying online and just realizing how, how easy it is, I don’t think that’s going to change. You know, things like the grocery store, I haven’t been to the grocery store in a year and a half. It’s delightful.
Mike Magnuson: That explains the lack of things in a refrigerator by the way.
Rachel Stewart: You know, what’s amazing is I know how frequently I ordered groceries online.
Jeff Cassidy: And what, what about business was so it, we just talked about the consumer and how they’ve changed in the internet adoption, accelerating and shopping online accelerating? Were there any changes that you made to the business and how you tackle digital that were particularly successful? And that you continue on with more than?
Rachel Stewart: Yeah, I mean, I think, like everyone, we pivoted hard into digital. And it worked. And I think it just for all of us created a renewed focus on it. And I think we were all really learning in our own different ways to run it like we do our salesforce with the same focus and intensity and skill team. So yeah, apps, I think, and I don’t see that going anywhere, anytime soon.
Mike Magnuson: What is that? Can you elaborate on what that means, like, to run it like your salesforce?
Rachel Stewart: I think in the past, especially in this industry, the way that it was a passive process where it was more just, we had the team was more order takers. And we assumed that the furniture on the web would just sell itself. And I think, you know, we certainly don’t assume that on a sales floor. And I think now there’s, you know, a growing assumption that that doesn’t work on the web, either. You need a skilled team to help answer questions, you know, in many different ways via chat via the phone, FaceTime, you name it.
Mike Magnuson:Got it. So really adding a lot of more interactive elements to your web experience, with real product experts, with real people who can, yeah, people who can really help got it, that makes sense. And by the way, I’m curious too, because you’re the first, at least on the podcast, the first full line furniture retailer that we’ve talked to, I’m wondering, did the pandemic affect anything as it relates to, you know, all the cross selling that happens within the store, like attachment of mattresses to furniture shopping or vice versa, did the pandemic affect any of those trends?
Rachel Stewart: You know, not for us but I think it’s, I mean, we’ve always taken bedding really seriously, and always bring it up in every conversation. So I think, you know, our attachment, or attachment was always probably pretty high. As a result, we believe in bedding, we talk about good sleep all the time.
Jeff Cassidy:Was that the case before you came back into the business 10 years ago, that was already the case?
Rachel Stewart: Not a part of our DNA.
Mike Magnuson: Let’s talk a little bit about, you’ve had a pretty tumultuous year in the furniture retail marketplace in Michigan. For those people who aren’t aware, obviously like that. So your longtime competitor Art Van pretty much shocked the industry when they announced in March 2020, before the pandemic, that they were liquidating, not just going bankrupt, but liquidating. And then the retailer that stepped in and replaced them, at least in some of their stores, also has already since come and gone. And I’m sure by the way that you would not want to speak ill of competitors or whatever. So I’m not asking anything about that. But what can you share about just the experience of having gone through this, I can imagine, obviously, that it opens up opportunities, for sure. But at the same time, it had to have been a tough thing to be trying to maintain a stable ship, while essentially there’s a large competitor in the marketplace going from liquidation to start-up to liquidation. That adds a lot of you know, just uncertainty and kind of chaos, I would think, to the market, what’s it been like to go through that?
Rachel Stewart: Well, I think I mean, so first, there were no, you could do 20 podcasts just on this topic, our bandwidth, hugely formidable. We have a lot of respect for them and learned a lot from watching that experience. So there’s a ton there in this market in particular, you know, you really felt bad for the members of the team who were caught flat footed going into a pandemic. We were lucky we could have many of them. But I think that you know, just as an industry that was hard to watch when you know, it’s a small industry so you know that people yeah, and then for consumers, that was hard because, you know, it just creates uncertainty when there’s consumers who I put very sizable deposits in our aren’t getting those back. Yeah. So it just I mean, I think it’s just that we talk about our history anyway. But it certainly doesn’t hurt to, to have the conversation that we’ve been here since 1912 family owned and operated, we are real people in this community who are going nowhere, that just creates consumer confidence.
Mike Magnuson: Because consumers at this point, I mean, even if whether they were directly affected by this, or just heard about people being affected by this, they must have a sense of like feeling kind of gun shy, perhaps about making big ticket purchases, having watched two major retailers go through this over the past year.
Rachel Stewart: One, in particular with a long term had you know, a lot of respect in the community with a lot of long term legacy. So absolutely,
Mike Magnuson:Yeah. So that you’re, you’re I think that’s great. You, you’re in a fortunate position to be able to, to have this long history to give people comfort in a time like that.
Rachel Stewart: Well, I think it helps. I mean, part of the history there. I mean, part of the lesson there is I think being locally owned and operated does make a difference when you live in a place where you work. So I think that’s part of the story in the lesson. That no, it’s a model that works at least for furniture retail.
Mike Magnuson: Yeah. I mean, for better or worse, I think that the retail industry is likely to see more of this across other markets. What do you think? Is there any advice you’d have for anyone? In terms of how best to prepare for this type of situation?
Rachel Stewart: Honestly, I don’t think there’s any preparation, I think you do the same thing that you would do every day anyway, which is build a strong sustainable company. Yep. And I think I mean, forget everything that happened in this market, but just COVID taught us all to be nimble and to be able to flex.
Jeff Cassidy: And you also bought one of the former Art van stores, right? Wasn’t that Rochester?
Rachel Stewart: We bought Rochester. So we got Rochester Hills, we’re now opening the old Canton store within a few weeks.
Jeff Cassidy: And have you found—so Rochester hills has been what, like half a year so far, something like that? Have you seen that there was a customer base kind of that came with that store? Or was it just the same as if you put a brand new store that you built yourself in that location?
Rachel Stewart: Well, it was a new location for our brand shop.
Mike Magnuson: They had just opened that in 2019, or something right like that?
Rachel Stewart: Yeah. It was their latest store, which was great from our perspective.
Mike Magnuson:Yeah. Yeah.
Rachel Stewart:Very easy, start over.
Mike Magnuson:Yeah, that’s great. Going back to the just the demand that you’ve seen, like you mentioned, people investing in their homes and so forth. I’m always curious to get people’s perspective on you know, how long do you expect that to last? Like, what are you guys planning for in that regard?
Rachel Stewart: You know, I think they’re, I think through 2021, the economy is going to be really strong, and we’re gonna see probably more demand than we have supply. Is everything happening in the world? You know, I think, I think 2022 we’ll start off really strong. And then, and then we’ll see. But I do think people just in general, I do think one result of their pandemic is just people think about their homes in a new way that they just didn’t before. So I don’t think we’re going to go back. I think COVID demand will stay higher than it was.
Mike Magnuson: Got it, you think that will equalize and a steady state that’s kind of higher than it was before just in terms of people valuing the comfort of their homes?
Rachel Stewart: I think so and I also don’t think I mean, tell me what you guys think. But I don’t see everyone going back to work five days a week in an office. So that just means people are gonna be home more.
Mike Magnuson:Yeah, I think that’s for sure. What we see in the Bay Area is maybe even an extreme example of that, where I think the companies have been super lenient about return to work policies. So I think that’s for sure we expect to see that here. I mean, but I do wrestle though, particularly with the mattress category, I wrestle with, you know, to what degree was this, as you said, just people basically increasing their share of wallet to the home and to what degree was it people pulling forward purchases that maybe just otherwise would have happened next year, right? Or to what degree was it perhaps, maybe just new households being formed at a higher rate than we’ve seen in the past? You know, we do know that millennials are kind of, you know, coming out, going on forming new households. They’re a big generation. So maybe there’s all three of those but I guess I wrestled to a degree with what’s the mix there because obviously the extent to which it’s been hold forward would affect future years, right? It’s like the opposite of pent up demand. And the extent to which it’s just increased share of wallet to your point earlier about people putting a higher importance on this that would vote more like this is a more long term lasting change. So I wonder when particularly with mattresses to what degree the mix, you know, how that mix shakes out? And I’m not sure that there is any hard data on that.
Rachel Stewart: Yeah, I could hypothesize but that. Yeah, you’re getting what you pay for.
Jeff Cassidy: Yeah, I think you’re right that it’s different for mattresses and for furniture, right? In furniture, you have the spending more time at home working at home, that opens up a new category of furniture that I need to buy, I need a desk to work at, I need a comfortable chair to sit in. But mattresses, the fact that I work from home doesn’t change, doesn’t make me need mattresses. So I think that that kind of long term effect could be very different for matches as for furniture. Yeah.
Mike Magnuson:Yeah, just on the distribution side, I’m curious to know you guys have done some innovative things like you had the best buy partnership. Is that still going?
Rachel Stewart: That’s not. We were, that’s right when I joined, actually. So it was a while ago, we were the national pilot within two Best Buys. We had 8,000 and 10,000 square feet in two different stores to sell furniture, which was hugely successful.
Mike Magnuson:There now do they just take that over and they’re now selling furniture themselves?
Rachel Stewart: Yeah.
Mike Magnuson: Oh, I did not know that. But that I thought it was also went the other way that you guys were selling electronics through like Best Buy maybe even had staff in your stores or something?
Rachel Stewart: Well, yeah, how we started the relationship was we were selling really well. So the story goes that the world collapsed in 2008/2009. And of course, you know, our big concern is just bring in the Yellow Pages the following year. And we really leaned in hard to what the industry later did with big picture packages by these five pieces of furniture, get a flat screen along with and Best Buy with our supplier. So we were I think at a time that I think it was the third largest b2b account that Best Buy had. I mean, we just cranked through those two days and promoted that really heavily. Yeah. So as a result, we had this great relationship with Best Buy. So as they were looking for a national pilot to test furniture, we were sort of an obvious partner in that regard.
Mike Magnuson: Yeah. Do you see I mean, did you learn anything from that experience that would lead to maybe other innovative out of the box type partnerships or what did you learn that maybe those things generally are not going to work or like anything you could share about that experience that would be useful?
Rachel Stewart: Well, so first, I mean, when it comes to betting, you learned that it was hugely successful in betting, because I mean, we all know this, it just increased the buying cycle. So you know, lots of people are sleeping comfortably. But it takes some deliberate choice to go into a furniture store or a betting shop. So it was really effective there.
Mike Magnuson: So meaning having a mattress in a Best Buy, where people are likely to go more frequently. Just got people to think about mattresses sooner than they would have otherwise.
Rachel Stewart: Yeah.
Jeff Cassidy: Wow, I thought you’re gonna say the other way, which was they were on the fence about when to go get a mattress and the fact that they could get free TV made them come into the store sooner.
Rachel Stewart: No, I haven’t thought about the issue with Best Buy’s. They have these big stores. And you know, they used to have rows of CDs and huge TVs that then became flat screens. So they just had extra real estate. So this was a test that they did. You found that, you know, people were stable, flipping portly. And you could get them on a mattress without them consciously being in the market.
Mike Magnuson:Got it.
Rachel Stewart: So that works as well.
Mike Magnuson: That’s a huge takeaway, by the way that like just getting people to really focus on their mattress before they otherwise would have ultimately gets them to. I mean, that’s something that a theory that’s been postulated many times, but you guys have hard core data to really show that that works, that’s a huge thing.
Rachel Stewart: And it might answer your broader question. No, I think you know, I think we as a company are always been pretty, pretty innovative and are always open to trying new things with different partners. Some work, some don’t. But absolutely I mean, we from our firm, we learned a lot from that partnership, so you learn.
Mike Magnuson: So one of the things you learned is that learning is good and that like partnerships that are innovative partnerships are a good way to do that. That’s, that’s a good takeaway, too. Let’s talk, we’ve been talking a little bit about that being an innovative way to acquire customers. Customer acquisition is obviously just a huge part of the business, as you learned as a youngster at your dining room table. I mean, tell us about your approach to advertising is really and maybe also, how did it change during the pandemic?
Rachel Stewart: So we, I mean, so we are very heavy promoters. Always have been, always will be that’s, that is who we are. In Detroit, TV is hugely important. It’s just that that is the vehicle of choice. There’s obviously other ever digital’s important. Print was important. Now, it’s different. But that is part of our DNA. So we are out there 365 in a very heavy and intense way. And I think it’s important, I think I mean, you need to, people aren’t thinking about a furniture purchase until they are and you need to be top of mind in mind. So that’s what we think you know, during the pandemics, with everything happening the supply chain, you talked to some people who were pulling back their advertising budget because they didn’t have the product to supply. That is just not something we would consider.
Mike Magnuson:So your strategy during the pandemic was basically just keep your keep the foot on the gas, the same exact kind of no more no less?
Rachel Stewart: We spoke about about different things. You know, we offer same day delivery, that’s always part of our message. We offer pretty aggressive financing that’s always part of our message. I mean, we believe in sort of diverse, diverse messages with frequency to hit customers with buttons.
Mike Magnuson:Did you find a media mix change at all during the pandemic or was it just pretty much the same television centric with a digital support structure kind of thing?
Rachel Stewart: It was it. No, it definitely what people were watching was different in women watching. It was different, there’s no question.
Mike Magnuson: Okay. So it changed within the medium, it changed. So where people were focused.
OTT became more important because people had time to binge watch everything.
Mike Magnuson: Right, right. We also noticed that last year, you became the head of the primary sponsor of the trade Thanksgiving parade. Is that right?
Rachel Stewart: That’s it. Yeah, that’s fun, yeah.
Mike Magnuson:Did that, by the way, did that parade end up happening last year? Or are they getting postponed?
Rachel Stewart: It was a production we had, we had one it wasn’t live, but they’ve been given what was happening in the world, they really did a tremendous job. And it’s a huge parade. And it gets a huge crowd here. So that they didn’t want those kind of crowds in downtown Detroit was sensible. And the parade company pivoted and they did it beautifully. But we are looking forward to a real parade this year.
Mike Magnuson:Yeah. Awesome. Great. And what’s coming? Will you have a float?
Jeff Cassidy: Yeah, you must already be working on the float, right?
Rachel Stewart: We have a float. So we did the same float for three years.
Jeff Cassidy: Okay, so the one that you did for last year will be the same one for this for this year.
Rachel Stewart: It’s huge, I can’t wait for people to see it. And I can’t wait for people from the Gardener team to dance out and go down.
Jeff Cassidy: I would say you know, you didn’t have a float in it before either. Obviously, you weren’t the sponsor before, but you didn’t have a float in.
Rachel Stewart: Not until they paid the float last year but it didn’t.
Jeff Cassidy: Right. I got it. That’s exciting. Are you going to be standing on something waving? Like round and round or no Brown? Or there’s not?
Rachel Stewart: It does.
Jeff Cassidy: Yeah. I think if you have if you have the crown, I think your two year old might say that is good.
Rachel Stewart: But well, in addition to Thanksgiving, so fun, because it’s Thanksgiving. But it’s also if you’re a retailer, one of the few days you’re actually closed.
Mike Magnuson: So we’re starting to get a much better picture of why Thanksgiving is your favorite holiday. You’re going to be on a parade float. Waving at people and the stores closed. This is all makes sense now.
Rachel Stewart: All making sense.
Jeff Cassidy: Throwing out Backfire Friday flyers as the top.
Rachel Stewart: Yeah. Whatever the TV’s going
Jeff Cassidy: That is cool. That seemed like it was a very big deal. To your point earlier being involved in the community that seemed like it was something that the community was very grateful for you guys stepping up, especially in it in a tough year.
Rachel Stewart: This is a big one. It’s a really big one for Detroit. It’s a huge parade. It’s sort of and I think also in this world. It’s just sort of a sense of normalcy.
Mike Magnuson: Yeah, for sure if this is gonna be a big deal it’ll be a big marker of a return to normalcy to have that parade back in full effect this year. Right, that’s awesome. Looking forward.
Jeff Cassidy: I know where I’m going for Thanksgiving next year Detroit.
Rachel Stewart: Come on, not far from Boston.
Mike Magnuson: Switching gears, I want to talk a little bit about product mix before we run out of time here. So you guys I’m particularly interested in mattresses so you guys have a pretty broad assortment of products. You’ve got a just for other people’s benefit. You’ve got heirloom at the moment heirloom beauty recipe or is black icon for Purple renova sleep, which I believe is a house brand? Is that a Gardener-White brand? CLE sturdy stern super Peter and TempurPedic. Yeah, I did it in alphabetical order, not in order of your face. So, obviously, one interesting outlier in that list sort of would be that would be Purple, since most people still think of them first and foremost as a DTC brand. I also know at one point or if I remember correctly, at one point, you’d had Brooklyn Bedding on your floor. So you have some experience with different DTC brands. I’m curious, based on your experience with these brands, do you see like, what’s been your experience with having DTC brands? I guess, first and foremost, and then do you see yourself increasing your floor allocation to DTC brands in the future? Or like, how do you see that playing out?
Rachel Stewart: Well, I think we added purple, because I think, I mean, I think why consumers like it, and why it’s successful is it’s something different, the grid was just not the same as everything else, which is why we added it was a real, you know, they have a great, great marketing engine behind them. And I think they’re really smart and how they use social media. But it’s, if you look at the product next, it was just an ad, and I think that’s how we evaluate it is you want to stop, you want to stay behind this product and sell to consumers? And in that case, the answer was definitely yes. So I think, you know, that’s how we’ll keep. That’s how we’ll keep looking at it and I think hats off to them. Because again, I think we’re gonna have to keep innovating. So there’s a story to tell behind these big white boxes. And that’s the game. So I think I mean, there’s a ton of, there’s a lot of more innovation happening in the motion basis. And I think that that really needs to continue to keep this category interesting.
Jeff Cassidy: What are you seeing consumers asking for?
Rachel Stewart: Well, I think, well, so a few things I was thinking before, you know, while driving it and just thinking about where the opportunities lie. And I think, I think I mean, first you lie in emotion based, there are a lot they make matters a lot more comfortable. So I think it’s there’s a great, there’s a great story there to tell, we see people selling a lot of them, there’s a lot of sleep apps, in my opinion, they’re all pretty similar. Just sort of tell you how much you suck without any actual information on the health of your sleep, which actually scientists know a ton about. So I think you know, over time, that’s sort of that’s where the opportunity is, is not just, you know, six hours, 23 minutes, but what tell me about the quality of your sleep. And then I think the other benefit of her smart basis, is you can it you can create a world where sleep isn’t just reactive, I wake up, I’m not comfortable, I move this instrument and it supports you through a full sleep cycle to help create a better night’s sleep. So to me, and I sort of see you in some of the technology that now little seedlings of this, but to me that’s sort of where the ball is going.
Jeff Cassidy:Basically an interactive system that’s monitoring you and preemptively adjusting before you wake up.
Rachel Stewart: Yeah
Jeff Cassidy:Makes sense.
Mike Magnuson: Got it. Well, yeah, that’s a hugely promising prospect. Although, is there anything close to that? Really? I mean, I know we have the snoring, anti-snoring that reacts at the moment. I think that’s the first step.
Rachel Stewart: Yeah, okay. It seems to me, I mean, there’s, again, there’s a ton of science here, we just need to link it with technology, which I mean, every sector does. And the question is, how long? How fast? Yeah. And at what cost? But I don’t think there’s anyone out there who doesn’t want.
Mike Magnuson:What do you see I mean, what do you hear from consumers in terms of their appetite for that? I mean, like, this definitely feels to me like the kind of thing that falls into that. What was it? I guess it was Henry Ford, who said, if I asked consumers what they want, they would have said faster horses or was that, I think was Henry Ford, who said that? You know, because I don’t think people are coming into your store, I guess, asking like, hey, do you have a bed that’s gonna like respond to my movements and adjust accordingly to help me sleep better? But like, I guess, when you tell that story to people, they’re pretty receptive, or you think they would be I mean, what?
Rachel Stewart: I mean, I think there’s not a person. Yeah, I don’t think there’s anyone out there that doesn’t want to sleep better. I think it’s, you know, our job as an industry to work with key vendors to tell that story well. And what the benefits are, I mean, I think we sort of like, if you look at most ads, now you sort of you say the word sleep, you don’t say that much about it. But I think there’s a lot there’s a there’s a lot more there. I mean, to me if you’re marketing to women, talk about all the benefits of sleeping, including anti-aging. There’s a lot of documented evidence there right now a lot of lead with anti-aging.
Mike Magnuson: Yeah. I think that pitch works with men too, by the way.
Rachel Stewart: Yeah, I agree 100%
Mike Magnuson: I agree with you though, that the key to these sleep trackers is like they’ve got to become, they got to result in something actionable. And the actionable thing could be something that happens passively to you like, just enhances your sleep experience without you having to do anything. Or it could be you know, but where the action is being taken that on your behalf. In other words, as opposed to by you, but at a minimum, they need to at least give me something that I can do actionable you know, because right now, it’s just this data, like you said, that has really no to me, no insight attached to it. You know, there’s no causality. There’s nothing I can extract from it that goes that I didn’t already know or couldn’t already hypothesize on my own like, Oh yeah, like, I slept badly, because it was noisy or I slept badly, because I had six cups of coffee in the afternoon.
Rachel Stewart:Well like, what every morning, or, you know, I wake up every day at three, and then, you know, turn this direction or I move my, you know, my knees out, like, there’s things you can infer there’s a clear next level for the technical.
Mike Magnuson:Yeah, yeah, if they can, if they can start to pull that those insights out of the data to let me know about them that will make them more actionable for me. And maybe better yet, to your point, if they can just build that those insights into the products of the product knows what to do with them, then that would be even better now probably bring it.
It’s equivalent like, you know, it’s a little creepy I think, but helpful, is when Google Maps you get in your car, and it tells you, you know, best route home, or best route to driving.
Mike Magnuson: That’s true like, that’s a great analogy, actually. Because when there was navigation, you know, people, once the actions just kind of got done for you. Like, where you didn’t even have to think about it. That’s when really that type of stuff really took off. It was just like, okay, it’s just literally telling me turn right, turn left, whatever and then people really adopted that. I’m going back to the whole brand mix thing. I mean, well, I guess I want to talk a little bit more about private label brands, because you don’t have a lot of private label brands. And that’s an area where a lot of the industry, a lot of people we talked to are like, Oh yeah, as we move into this world, where more and more manufacturers are feeling a lot of cases out of necessity, maybe that they need to sell direct to have a direct relationship with, with customers whether to get reviews, or just to help their product innovation cycles. And they’re seeing the success that DTC guys are having by virtue of the direct relationships they’ve got with consumers, even in in their in store sales. They’re out there, they’re benefiting from those relationships. So in that world, where, where there’s a lot of brands that are going direct, a lot of people think that the answer, or one of the answers is more private label you know, like having a really big mix of a lot of private label. What’s your view of private label? What’s your view of the future in short, how do you think it fits in?
Rachel Stewart: I think it really does. So we have a huge bedding aisle. And I think our view is we you know, we want there’s no one in Metro Detroit who could not come in and find a comfortable mattress and within their budget. I think to the extent that there are gaps in that mix that we see we wouldn’t believe in private label wouldn’t we’ll believe in private labeling. But I think I think people come to us because our, our sales team is truly excellent. When it comes to product management betting. And I think our job is to find the best product for that person period. And to get them in at the right time, as opposed to them wanting to come back to return it. And we focus a ton of time, energy and money and training to that. If there’s a hole or you couldn’t satisfy a customer when they should private label, right. But I think there’s some, you know, our brand partners do a really good job with a lot of advertising dollars behind it. And a lot of R&D dollars behind it. So I think it’s you really have to look at how to fill holes on your floor.
Mike Magnuson: So if you had to crystallize, if there’s one thing that the private label brands could do to gain share, it would be basically just look for holes in where the big brands is that?
Rachel Stewart: I think yeah, I mean, I think I think look at what consumers are looking for and try to you know, I think our job is to try to satisfy them, you know, in the most at the best price points. Yeah. So now if you think you can do it better than that, I think privately playing makes sense.
Mike Magnuson: I mean, the obviously not you know, the obvious knock on private label is that private labels not gonna swing your door. Right. So like, that’s the other side of it, the DTC brand. You know, basically, in theory, what you’re getting with these DTC brands is that they’ve been pretty good at branding. And they should hopefully, you know, maybe out punch their weight class in terms of the amount of traffic they bring into your store. Have you seen that happening? Or do you like, do you believe in that, and actually, I’m curious, in particular, that’s you this because, as a as a full line, internet retailer, I know that on the one hand, you don’t necessarily rely on mattress brands to swing your door because you’re able to cross sell furniture, buyers on mattresses. But on the other hand, every person who does come in your door, let’s say to buy a mattress is worth more to you, because you can attach furniture items to their purchase, too. So like, I’m just curious how you view the tradeoff between maybe a brand that can swing your door, but maybe doesn’t offer as quite as much margin as a private label brand? Or maybe some of the other advantages that that other brands could offer?
Rachel Stewart: Yeah, I mean, we haven’t focused on, we really haven’t focused that much on private label, too, because we think we have a really pretty diverse and strong betting mix. Yeah, for sure. There’s brands that do, I think, a really competent job and marketing, that changes over time and that’s, that’s really important. We promote brands really heavily. There’s, in some cases, you know, hundreds of years of brand equity there. And that’s important and really valuable. So we push that really hard.
Mike Magnuson:Yeah, but even comparing, like DTC to traditional brands even forget about private label for a moment, like, how does that shake out?
Rachel Stewart: I think they all do. I mean, I think you want to be as diverse as you want, we have a diverse consumer base, and different brands speak to different people. So our you know, our job is to, you know, press the levers differently depending on which advertising medium in which consumer, but I think there’s certainly a place for everyone, and they’re all different with different strengths, and then once you get in the door, I mean, we still do we believe in a comfort zone. So which for us works.
Mike Magnuson:Shifting gears again, one of the things I noticed right away when I got into this industry was, if not the most diverse industry. That’s probably an understatement. But particularly that may be true on the mattress side, too. I’m not sure if it’s equally the case on the furniture side. But nonetheless, that certainly includes but is not limited to the presence of women, and particularly in high ranking positions. I don’t want to presume that just because you’re a woman, this is like a critical issue to you. But do you have a point of view on what can be done to change this? And what how the industry might benefit from having more diversity, or more how the industry might gain from doing that?
Rachel Stewart: Well, so Mike, I’ll start with the end, I think you know, we all know the consumers that she so to me, the benefits are obvious. And I will say, you know, this is often a conversation within the industry. And I will say I’ve had some fabulous male mentors. So I don’t, you know, I know mentorship is certainly part of it. But I’ve, I’ve been really fortunate. And that I’ve received great mentorship, stepping set, I think, you know, if you want the industry to change, you need more examples of leadership of people who look different across 20 different variables. So I think it’s I mean, I think it’s, we get like everything gets the hard work of starting at the starting at the bottom, and training people from the bottom and then promoting those that are really qualified it but I think I mean, like everything, it needs to be a concerted focus. And, you know, I came out of the technology industry, same issue. But yeah, when they started really focusing on PhD programs, and started really trying to attract women, then suddenly you end up with more tenured faculty. I mean, it’s just it’s the same thing. It just takes time, energy and focus. Got it. That’s one. But I do think that benefits are obvious.
Mike Magnuson:So, okay, the other shift, another abrupt change here. But I also wanted to ask you, this podcast kind of provides an opportunity to speak to the industry speak to other retailers. And one of the things that we think is unique about that is it’s an opportunity, perhaps for retailers to talk about things that they think could be improved and changed in the industry, through perhaps cooperation amongst retailers and between retailers and brands. So to the extent that there’s anything out there that you think there’s a need for collective change, I think this is I want to give you the opportunity to raise any issues you think that would be worth discussing.
Rachel Stewart: So there’s, oh, there’s that. I mean, it’s I think, in general, there’s a lot more that we can all do through collaboration that we’re all you know, we’re all fighting the same thing. But one thing we were timing, the thing we were talking about earlier, which I think is really important is on end, you know, what, when you get a product mattress back in particular sort of what do you do with it? Both? I think there’s a challenge from a business model perspective, in terms of how to go from, which is what you guys are talking about, but then also just sort of the lifecycle of a product you know, do we create a good ripe product for the foam? Is there? You know, is there technology that could help shred more efficiently, but there’s a lot there that I think would benefit all of us and forever and to be good hurts no one. So I think that’s, that’s definitely one.
Mike Magnuson: And by the way, just on that one, just Rachel’s referencing episode seven and eight of this podcast that if you haven’t heard them, we discuss return policies, and in particular, how to limit the number of products that are returned as one way to address that issue. And then the second issue she was raising this when we haven’t tackled on the podcast, which is this question of what more ecosystem can be built to do things do better things with the products that we ultimately can’t avoid being returned? Correct. Thank you.
Rachel Stewart: I think I don’t think anyone, I think you were what you were saying earlier, right, that people use warranties as a proxy for durability and quality. And I think, to coordinate somewhere in that regard would make sense, because I think, you know, you’d rather give your real data on a product as opposed to this, you know, like, ephemeral thing that keeps changing. And then, and then somewhat that way, I just think no one’s winning, if they’re all inconsistent and sort of confusing, that I think that just means customer, fewer customers shop for mattresses.
Mike Magnuson:I agree better, better data on actual durability, and then shorter warranties, like the warranties end up being this right, they just end up being setting people up for disappointment, because of the way they’re written in the first place. And it should just be about having a better metric of durable, shorter and,
Jeff Cassidy:And consistent, because I think you’re also saying that the inconsistency breeds lack of trust, and kind of insert some distrust in the entire process for the shopper, which I also think is true.
Rachel Stewart: Yeah, that precisely and I think you know, at the point of sale, the last thing you want to be talking about is the warranty. Like when this fails, what’s going to happen, you want to tell them about the great product they just bought and how well they’re gonna sleep.
Mike Magnuson: That’s a really good point. It’s like asking someone to marry you popping the question with your like, prenuptial agreement, like right there.
Rachel Stewart: Right. So that’s another one. And then I think just overtime. I think it’s an industry isn’t a world, it’s a passion of mine, I think we need to think about sustainability. And how we’re impacting the world environments.
Mike Magnuson: In what ways, do you think?
Rachel Stewart: You’re certainly all in that together. For sure.
Mike Magnuson:In what ways do you think the industry could play a bigger role there?
Rachel Stewart: I think I mean, I think we need to think about what materials we’re using, you know, what end of life looks like, there’s just the whole host of questions that I just don’t see us having a conversation about, that’s really important.
Mike Magnuson:And do you think that there’s a, how could that conversation be better facilitated across the industry, do you think?
Rachel Stewart: Oh, I think that’s the role of industry organizations, I think, I think, I mean, I think that’s why you have conferences and bring on thought leaders, there certainly many product categories with this as a conversation, and to the extent we learn from them, coordinate with them, etc, you know, we’ll create better products for it. I mean, I started my, one of my first jobs was at the Clinton Foundation working on sustainability. And it turns out that people that were really interested and engaged in at the beginning, we’re certainly interested in sustainability, but also quickly found out that if you use less, it’s cheaper, and you can deliver more cheaper product to consumers. Yeah, and I think and you know, I can give you countless examples. And I think that’s sort of the conversation we need to have as an industry as well.
Mike Magnuson: Right, that makes sense. Once you sort of put the cost savings in there for the industry, it makes it a little easier to swallow maybe.
Rachel Stewart: Right. Yeah, my one of my first projects was on plastic bags. Not sexy, but if you use enough, it becomes real important.
Mike Magnuson: Yeah, alright. Well, I know you’re short on time, I’m going to ask you just one last question. Is there anything I didn’t ask you that you think is important?
Rachel Stewart: I don’t think so. I’m sure.
Mike Magnuson: Okay. I take that last question was a bit of a catch all already. So you thought you probably had a chance to Yeah, that is incorporate your any other thoughts you had? Well, with that, then I think we will wrap it up. And thank you so much for your time. It’s been awesome chatting with you. So super fun. And thank you all for listening and please remember, if you like what you’re hearing, subscribe to the podcast and leave us a review in the apple podcast store, the iTunes Store. It helps other people discover the podcast. In the meantime, thanks so much for listening and we’re out.
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