Bedgear using brand ambassadors to sell its 'performance' sheets

Eugene Alletto, CEO of Bedgear LLC, wants to drag your bed into the 21st century.

His privately held East Farmingdale company is carving out a new category of "performance" sheets and pillows that wick away sweat and keep you cool while you sleep. Much as Starbucks turned the common cup of joe into a venti latte, Bedgear is seeking to transform the mundane bedsheet into something glamorous -- and more expensive.

The company is growing. Six years after Alletto conceived the brand, more than 4,000 retail locations around the United States and Canada sell Bedgear wares. Revenue is on track to grow 38 percent this year to $50 million, he says. Bedgear has about 150 employees, all in the United States, including almost 50 in East Farmingdale. Alletto expects to hire another 25 or so nationwide, including some on the Island, by year's end.

Bedgear isn't alone in discovering that sleep is a hot business. Microsoft, Nintendo and Apple sell apps and gadgets to track sleep cycles. One Manhattan sleep boutique's website offers oils, sheets, masks, beds and a $395 pillow made from white European goose down.

And the company has competition in performance sheets: One rival has sued, saying Bedgear infringed its bedsheet patents.

But its growth has been robust. Its 2014 revenue was almost double the level in 2012, landing Bedgear on the 2014 Fast 50 list of Crain's New York Business.

Bedgear's growth places it in the vanguard of private companies that are emerging to fill the gap left by major corporations such as OSI Pharmaceuticals or Northrop Grumman that moved off the Island or shrank.

While the ranks of Long Island companies traded on major exchanges decreased from 99 in 2003 to 56 at the end of last year, according to S&P Capital IQ, the number of company headquarters overall on Long Island grew by more than 50 percent over 10 years, to 467 in 2013, state Labor Department data show.

At Bedgear's headquarters, complete with an indoor basketball hoop and a decidedly SoHo feel, Alletto, 46, and his young staff are forgoing traditional marketing moves. Instead, Bedgear courts brand ambassadors, stages events like a sleepover at Citi Field featuring Bedgear products, and funds a foundation to educate children about the value of sleep.

Alletto is a natural salesman, and not easily deterred. "Rejection doesn't mean 'no,' " he said. "It just means 'not now.' "

Another favorite saying, to underline the importance of putting people in the right jobs: "Don't hire a rooster to do a squirrel's job." He prefers the job title of "Quarterback" to CEO.

Bedgear will need the right employees and lots of attitude as it tries to change Americans' shopping habits. The U.S. market for pillows and sheets is about $6 billion annually, according to The NPD Group Inc., based in Port Washington. Synthetic fiber garments sold by Nike and Under Armour dominate athletic wear, but cotton still rules the American bedroom.

Almost four out of five consumers prefer cotton sheets, said Shannon Maher, an assistant professor of home products development at the Fashion Institute of Technology in Manhattan.

Though high-tech bedding lives up to its promise of keeping sleepers cool and wicking away moisture, she said, changing buying habits, where comfort, price and ease of care rule, will not be easy: "Sheeting is a tough sell."

Rethinking sheets

To hear Alletto tell it, Bedgear is the culmination of a Long Island business odyssey that springs from his Hempstead roots.

Alletto was the eldest of four children. His father was a psychiatrist and his mother a nurse. Life got much tougher when, the summer before Alletto's freshman year at Holy Trinity Diocesan High School, his father died.

Instead of wallowing in despair, his 4-foot, 11-inch mother marshaled her strength, took charge and kept the family afloat.

"She focused us on moving forward," said Alletto. "It was her way to help herself get through the anguish."

Alletto said he learned from her to overcome setbacks: "When there's a problem, I immediately look for the solution. It happened. Compartmentalize it. Analyze it. And learn from it."

He put that principle to use while working at a video store in Garden City in the 1980s as a student in high school and at Nassau Community College.

The store delivered videos to the family of soap opera star Susan Lucci and others in the affluent community. But children or baby sitters who received the videos rarely had money to pay, putting the store's owner in a cash crunch.

Alletto cut a deal to take 20 percent of any money he collected. After going house to house and coming up dry, Alletto tried a different approach. He made a list of the deadbeat families and their outstanding balances and displayed it near the register. Suddenly, families started coming in, cash in hand.

A career in bedding

After a stint as a stock broker trainee in Garden City, Alletto became a manufacturer's representative for a home furnishings company. There followed a series of jobs in the furniture business. In 2005, he incorporated his own company, Guard Master Inc., which imported a variety of products, including sheets, from overseas. It became the precursor to Bedgear.

Alletto said how Americans buy bedding confounds him. Shoppers try mattresses on their backs even though 70 percent are side sleepers, he said. Shoppers stand and squeeze pillows without trying them on a bed.

"This is crazy!" Alletto said. "This is barbaric."

Alletto figured he could use his industry knowledge and contacts in the Far East to enter the bedding market, but he needed something to wow consumers.

Inspiration struck in the spring of 2008, when he was coaching the lacrosse team of his son, Jack, now 11. "It finally hit me," Alletto said.

He visualized the synthetic performance fabric used in his son's shorts as bedding. "The epiphany was that moisture and heat happen all night long." Alletto cut a piece of fabric from his son's mesh shorts and found mills in Asia to supply the material. The sheets are stocked at a Bedgear facility in Rock Hill, South Carolina.

In addition to sheets, Bedgear sells mattress and pillow protectors and pillows that promote air circulation for side, back and stomach sleepers.

Sleepy's website recently charged $229.99 for a Bedgear Dri-Tec set of queen-size sheets and pillowcases, while side sleeper pillows were going for $56.99 each. A package of two pillow protectors, one mattress encasement and one mattress protector for a queen bed cost $249.99.

Mission marketing

As a small company, Bedgear stretches its marketing dollars.

Alletto signed deals with athletes such as ski jumper Lindsey Van and marathon runner Kris Lawrence as brand ambassadors. He also signed Bedgear on to become the New York Islanders' official sleep sponsor.

Those high achievers fit into Bedgear's target demographic, which Alletto identifies as "life hackers," people who use technology or other products to get the most out of their pursuits.

Michael Kamins, a business professor at Stony Brook University, said connecting to lesser-known brand ambassadors and funding the Sleep Fuel Foundation to send athletes to schools to promote proper sleep are canny ways to build the brand without breaking the bank. "It doesn't hurt to start small," he said.

Bedgear is competing against rivals small and large. Select Comfort Corp., a billion-dollar company based in Minneapolis, sells Sleep Number-branded sheets made from lyocell, a fiber derived from wood pulp. The sheets are marketed for moisture control and breathability.

SHEEX Inc. was founded in 2008 in Irmo, South Carolina, by two former women's college basketball coaches. Like Bedgear, it promises a cooler, drier sleep, uses brand ambassadors and holds U.S. patents on bedding. On Nov. 7, SHEEX sued Bedgear in federal court in Wilmington, Delaware, charging two patent violations. Alletto declined to comment, saying he had yet to see the lawsuit.

Bedgear is not standing still, introducing a travel pillow and a bedding line for babies in the coming months. Already sold through Hicksville-based Sleepy's 1,000 stores, Bedgear is expanding its retail reach to the Cabela's Inc. hunting and camping stores (camo sheets) and to P.C. Richard & Sons' new home furnishings departments.

The company's next frontier, in 2015: mattresses.

The rollout of mattresses will let shoppers complete their Bedgear-branded sleeping experience, Alletto said. "Once you believe in a brand . . . you'd entertain anything involving that brand."

By Ken Schachter

kenneth.schachter@newsday.comkschach

Ken Schachter covers corporate news, including technology and aerospace, and other business topics for Newsday. He has also worked at The Miami Herald and The Jerusalem Post.