For many years, mattress suppliers provided little support for brand licensing.

But with the arrival of direct-to-consumer (DTC) companies promising lower prices, long tryout times, and free returns, brand licensing has increasingly become part of the industry’s fabric.

Previously, the likes of King Coil, Spring Air, Therapedic, and Englander have made their brands available for international markets where licensees manufacture branded mattresses and operated stores. And Temper Sealy had a 47-year licensing relationship with the U.K.’s Silentnight Group for distribution of Sealy products before shifting the business to internal management.

Now, as DTC competitors like Casper, Purple Innovations, Avocado Green Mattress, Nectar Sleep, and others champion the mattress-in-a-box business and carve out their own niches, major mattress companies are shifting their focus to brand licensing.

Serta Simmons Bedding (Serta, Simmons, Beautyrest and Tuft & Needle brands) claims a 19% share of the U.S. mattress market with 42 licensees globally—including 18 in the U.S. The company hired agency Brand Central and signed deals for mattress pads, toppers, and sheets for Simmons and Serta with the likes of Pem America and Keeco, respectively. It has also licensed Blue Ridge Home Fashions for Beautyrest and Serta blankets, comforters, and pillows.

Temper Sealy International (Temper, Tempur-Pedic, Sealy, Stearns & Foster) is represented by agency IMG and recently signed agreements with Standard Fiber (Tempur-Pedic, Stearns & Foster, Sealy) for pet beds. That’s in addition to an earlier pact with American Textile Co. for Sealy pillows, mattress pads, and comforters. Tempur Sealy is also set to spend a record $450 million on marketing this year as it launches new Stearns & Foster, Temper, and Tempur-Pedic lines as well as opens a new 700,000-square-foot foam pouring plant in Crawfordsville, IN.

“They’re trying to capture that white space and staffing up to get that revenue share in the licensing of other categories,” said one licensee executive. “The mattress companies want to get those younger consumers who may not care about thread counts but are interested in brands that appear cool and hip.”

Being nimble and capable of quickly adapting to changing trends has long been a staple of DTC firms. But these companies are now opening brick-and-mortar locations (Casper had 68 stores when it was sold to Durational Capital Management and taken private, and Avocado recently opened one in Brooklyn, NY) and inking traditional partnerships.

Starting in May, Purple will “reimagine the product lineup, brand messaging, and wholesale distribution,” CEO Robert DeMartini said. The DTC firm has 101 showrooms, with 11 more set to open this year, and sells through 3,500 retail stores. And Casper’s investors once included the rapper 50 Cent and actor Leonard DiCaprio as well as Target, which carried the brand’s mattresses.

This rise in licensing and brand repositioning comes as the mattress industry braces for a potential downturn in 2023 following two years of sales spurred by the pandemic. In the face of declines, Serta Simmons filed for bankruptcy earlier this year.

And while unit sales declines 20-25% in the fourth quarter, Tempur Sealy CEO Scott Thompson said the mattress business will “return to growth” in 2024. According to Fortune Business Insights, global revenue is expected to increase 5.3% annually through 2029 to $72.95 billion.

The shift in consumer spending towards services and experiences put even more pressure on demand in 2022 and led to what has been cited by many as the worst annual decline in the history of the U.S. bedding industry, DeMartini said.

“Against this challenging backdrop our organization has made significant headway towards improving the efficiency of the business and strengthening our foundation for growth,” DeMartini said. “We believe [we have] positioned the company to deliver improved results even in the face of continued market headwinds.”