This Furniture Store Lost $7 Million on the Super Bowl
If Jim "Mattress Mack" McIngvale is nothing else, he's a gambler.
As anyone from the Houston-area will tell you, McIngvale, the owner of Gallery Furniture, is a local legend of sorts. His furniture commercials have received constant airtime over the decades, making him as recognizable a figure in Houston as Hakeem Olajuwon and Craig Biggio. Regardless of the deal being advertised, Gallery Furniture's spots would always end with the ever likable Mack himself delivering his signature slogan, "Gallery Furniture saves you money!"
The last time I wrote about McIngvale, I was discussing exactly how much money he was saving people. In mid-January, Gallery Furniture ran a promotion in which any person who bought at least $5000 worth of furniture and picked the correct winners of NFL conference championship games would receive a full refund on their purchase. Both favorites won, and so did 80 percent of the customers who participated in the promotion, which reportedly cost the store roughly $600,000.
I hardly imagined that $600,000 would seem like a small drop in the bucket for Mack in terms of losses, but then the Super Bowl happened.
For the big game, Gallery Furniture decided to hold another promotion with even simpler terms than the previous one. To participate, customers had to purchase at least $6,000 worth of furniture and have it delivered to their home before kick-off. If the (at this point slight underdog) Seahawks won the game, everyone would get a full refund.
Well, the Super Bowl happened and the Seahawks couldn't have more definitively won the game. Mack had once again lost on his big gamble, but this time it would cost him an even more absurd figure: $7,000,000.
And no, the contest was not insured.
I reached out to Mack for comment, and he seemed oddly pleased with the result.
"We're trying to get more millennials out here and we attracted hundreds if not thousands of young customers," McIngvale said. "And we think that now that they've shopped with us, they'll never go anywhere else."
It certainly is a bold step to secure brand loyalty, but when one considers that $7 million represents, according to Darren Rovell of ESPN, roughly 5 percent of the store's annual revenue, there's little doubt that this promotion will have a serious effect on Gallery Furniture's profit margin.
So while Broncos fans might be reeling today, perhaps they can take a little solace in the fact that all they lost was a football game.[ESPN]