Store Loses Super Bowl Bet, Gives Away $7 Million Worth Of Furniture

furnituregalleryA furniture store in Houston has to give $7 million worth of furniture away to its customers after losing a bet on the Super Bowl. Don’t feel bad for the store owner, though: from his point of view, this is a good thing. Not because he’s a terrible business owner, but because the promotion got customers in the door, got the store’s name in the news, and just might create long-term customers.

“We’re trying to create customers for life and make the store relevant and fun,” store owner Jim “Mattress Mack” McIngvale told TV station KHOU. Free furniture is super fun.

Here’s how the promotion worked: the store owner picked a team by flipping a coin. That team was Denver. Customers who spent $6,000 or more on furniture before Sunday evening would receive their purchases for free if the Seahawks won. They did.

Of course, that $7 million figure isn’t quite true: that’s the retail cost of the free couches and mattresses, not what the store originally paid for them. It’s the profit and overhead that the local chain will forgo, in exchange for lots of goodwill and good publicity. You’d think that McIngvale would have learned his lesson: most shoppers chose either the Broncos or the Seahawks to win their respective division championships when the store had a similar promotion a few weeks ago. For that sale, customers could choose which teams they wanted to bet on, and win their furniture if they were right.

Mattress Mack Refunds More Than $7 Million to Customers for Lost “Super Bowl Bet” Promotion (Thanks, Rachael!)

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  1. jaredgreenwald says:

    There are also specialized insurance policies that businesses can get for such promotions. The price of the pollicy usually depends on the liklihood of the event happening. So, if this guy was smart about it, he probably paid much less than even the cost for the actual items as mentioned in the article…

  2. CommonC3nts says:

    That store always does promotions like this.
    They buy an insurance policy to cover it when they lose, so they are not losing any money but still making a profit.

    • PhillyDom says:

      Neither you nor the other poster read the linked article:

      McIngvale says he and his team worked out the financials for the promotion, making sure they could make it happen.

      “No insurance policy. The customers paid for this and we paid it right back to them,’ he said.