Game Changers: Luke Sherwin, Casper
Here’s the second of six profiles of retail industry game changers. Today’s interview is with Luke Sherwin, co-founder and chief creative officer of Casper, a mattress delivery company. (Here's profile one, Meaghan Rose, Rocksbox.)
Total Retail: Where did you get the inspiration to launch your company?
Luke Sherwin: In 2013, we observed people beginning to take sleep more seriously. Yet there weren’t any products out there to actually help people do it better. The mattress industry had been alienating consumers for a long time. We started by designing one universally comfortable mattress, then surrounding it with a super simple direct-to-consumer experience and pressure-free customer support.
TR: How did you develop the resources and guts to start your own company?
LS: The mattress industry was making hefty profits off the backs of consumers. Commissioned salespeople, stressful mattress showrooms, confusing return policies and lack of transparency made buying a bed a terrible experience. We identified three key challenges. The first was to reinvent the mattress itself by designing just one universally comfortable bed. The second challenge was to fix a negative customer journey, which was accomplished by free delivery in a small box, a 100-day home trial and easy returns. The third challenge was to create a brand and experience that people would not just tolerate, but actually love.
TR: How was Casper funded?
LS: Prior to launching in 2014, Casper closed a $1.85 million seed round led by Lerer Hippeau Ventures. Since then, we announced $13.1 million in a Series A investment led by NEA, and $55 million in a Series B round led by Institutional Venture Partners, bringing total funding to $69.95 million.
TR: What was the pivotal marketing campaign or channel that really catapulted the business in its early days?
LS: Casper launched with basically no budget for marketing. As a result, it was news articles and our Twitter account — which acknowledged the absurdity of a tweeting mattress, the joy of bedtime and the struggle of waking up in the morning — that were really important for us. But the No. 1 driver of Casper’s early success was word-of-mouth buzz among early adopters.
TR: What are the key online and offline marketing strategies you employ today?
LS: People often tell us that they’ve seen our fun subway ads, and we’re really active on social media, but it wouldn’t be very smart for us to try to compete with big mattress companies when it comes to marketing spend. What we can compete on is being really creative, having a sense of humor, providing incredible customer service and engineering objectively amazing products.
TR: How are you planning to scale the business?
LS: Since our launch, Casper has been inundated with requests for more sleep products, and we’re exploring every category you can imagine in the realm of sleep. We just expanded Casper to Europe, and we’re constantly adding new employees, many of whom will help us continue to provide over-the-top customer service as Casper grows.
TR: Can you talk about your hiring strategy?
LS: We’re always on the lookout for smart, positive and talented people who love to sleep.
TR: What advice would you give to those thinking about launching their own retail business?
LS: Your customers are your best resources. We attribute a large part of our initial success and growth to the testimonials, word-of-mouth reviews and social media posts from Casper owners. We communicate with our customers every step of the way.
TR: What can traditional brick-and-mortar retailers learn from your company?
LS: If you’re unhappy with a product, service or way of doing business, that’s an opportunity. Chances are good that you aren’t alone.
Melissa Campanelli is Editor-in-Chief of Total Retail. She is an industry veteran, having covered all aspects of retail, tech, digital, e-commerce, and marketing over the past 20 years. Melissa is also the co-founder of the Women in Retail Leadership Circle.