Founded in 2018, Cocoon was launched from a love of the versatility of sofa beds, while identifying an issue with the typically thin mattresses usually found. Cocoon’s founders made it their mission to research, redesign and revolutionise the sofa bed. The goal was to try to provide improved sleep, encompassing a deeper, more luxurious mattress without compromising on the design of the sofa. Combining a deeper pocket sprung mattress and one-touch opening mechanism, within a choice of 2–3-seater designs and corner modular sofa bed options, Cocoon now boasts the best sofa bed range to market.
With a high-end product, market-leading delivery times and soaring customer satisfaction scores, Cocoon was growing at pace – and ready to expand its offering.
After 4 months with DivideBuy, Cocoon’s market-testing of other POS finance providers in its space showed DivideBuy was delivering a higher conversion rate. There was a 73% increase in average order values, and higher conversion rates from its target demographic of buyers aged 25-35 across their eCommerce platform – with a 95% approval rate for credit.
Phil Hankinson, Marketing Director at Cocoon, explains the logic behind the decision to partner with DivideBuy. “Cocoon was initially reluctant to look at finance options due to not wanting to saddle our customers with debt they couldn’t afford or high interest rates. DivideBuy alleviated these concerns with its flexible, pragmatic and interest free solution. Our shared core values set ensures our customers get a fair deal.”
For Cocoon founder Craig Rutter, an alignment of values and high standards was key. “When we looked at partners to come on this journey with us, we did a lot of research into what people were saying about different finance providers. We were glad to partner with DivideBuy because their philosophy is very similar to ours. Our conversion rates are now higher. We’re growing 500% year on year and are confident that DivideBuy is the right finance provider to support our future goals.”
Having accelerated growth during the pandemic due to the uptick in remote working, Cocoon continued to scale post-Covid as hybrid working became the norm. Its quality sofa beds were particularly popular with first-time home buyers, who were operating on a limited budget and wanted to make the most of their space.
Cocoon decided to support and expand its consumer base by offering point of sale finance – but there were reservations around this.
Cocoon is currently the most-reviewed sofa bed company in the UK, with a 4.8 star rating and a 97% recommendation rating. With these stats in mind, Cocoon needed a POS finance provider whose ethics, customer service and value proposition would align with its own.
Aspirational purchase power:
A key driver behind Cocoon’s decision to offer POS finance was to help customers, particularly those aged 25-35, to buy the sofa bed they really wanted, but was perhaps too much of a stretch. Cocoon wanted an interest free finance solution with a track record of high approval rates.
With these factors in mind, Cocoon began to put out feelers for a finance provider that fit the bill. When DivideBuy appeared on its radar, Cocoon was impressed by its positive customer feedback and high satisfaction ratings across various platforms. In January 2023, DivideBuy’s interest free finance solution went live on the Cocoon website.
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Interest free credit agreements provided by Zopa Embedded Finance Limited trading as DivideBuy are not regulated by the Financial Conduct Authority and do not fall under the jurisdiction of the Financial Ombudsman Service.
Zopa Embedded Finance Limited trading as Dividebuy is an appointed representative of Zopa Bank Limited which is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority, and entered on the Financial Services Register (800542 & 993200).
Zopa Embedded Finance Limited (14602085) is incorporated in England & Wales and has its registered office at: First Floor, Brunswick Court, Brunswick Street, Newcastle-under-Lyme, ST5 1HH. VAT Number 439973733.
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Ends 31st of December 2023
