When I posted on my Facebook Page asking for opinions on whether or not cloth diaper companies should allow deal sites like Zulily and BabySteals to sell diapers, I was surprised by the tremendous response from everyone. I was even more surprised by how divided everyone was on this issue. Therefore, I did what I always like to do…I created a survey to try to collect the opinions and understand this issue from the multiple perspectives. In this article, I want to share with you the responses and look at the different sides of the story. I want to be clear that although I show different perspectives, no one individual is speaking for a group as a whole. These are each individual voices talking about their experience, not ANYONE speaking for a collective whole.
The deal sites I am referring to are those like Zulily, BabySteals, and a few others. Diaper companies may send a bunch of diapers to that company and it gets sold for a price significantly lower than retail price. Quite often this is a way of moving out old stock, so it can be older versions of a diaper. But sometimes it is a newer version, which puts those discount sites in direct competition with retailers. In fact, the diapers are sometimes sold on these deal sites for prices less than the WHOLESALE price the retailers could buy the diapers for. Is this fair? Let’s take a close look at the issue.
Should Diapers Be Sold On Deal Sites at Prices LOWER than What Retailers Can Pay for It?
When I asked everyone whether or not cloth diapers should be sold on deal websites at a price LOWER than what a retailer could sell a diaper for, a little over half (56%) said yes. This was mostly the voice of the customers (in fact, 100% of diaper makers and 93% of retailers said they should NOT.
Customer: At the end of the day, I need a good deal
“I’d like to be able to get those kinds of deals from retailers I love, but I will buy a diaper I really want from one of these discount sites if it’s a really great deal. I’ve saved a lot on some really awesome diapers that way.” Copper
“As much as it is nice to support a small business, when it comes right down to it, I need to save money. In this economy most people do. If cloth diaper companies would offer those great prices to the retailers and then the savings passed on to the consumer, great, but if they choose not to do that, I can’t afford to pay more just to buy at the retailer instead of scooping up an awesome deal elsewhere.” Michelle
“We need to stop undermining struggling Americans. I get that some people have a hard time affording diapers, but the bulk of people buying on these deal sites are not that bad off. Primarily they are bargain hunters and people who don’t care to pay full price. I, too, like a deal but not at the expense of others. Our economy is falling apart and this is a huge part of why. We need to support local businesses so they can in turn invest in us by employing us, employing other local businesses (electric co, etc) and paying taxes that help the community. I doubt Zulilly is helping to fund my local schools.” Mandi
Does It Expose Disposable Diaper Users to Cloth Diapers?
Customer’s Perspective: ”I think that diapers on deal sites are generally good: they bring awareness to the diapers and expose them to people who don’t seek them out. ” Anonymous
Retailer’s Perspective: “The deal sites are a double edged sword. They raise awareness, give opportunities to try new diapers, etc. But if items are expected to be on there so people wait, or it causes consumers to expect those prices on a daily basis, it hurts the retailers and the manufacturer in the end. Using them as a way to try out new things is great, but you must remember that it is a deal site and the retailers can’t sell you those items for those prices. If you like what you tried out, seek out a local (or local-ish online) retailer to purchase from in the future.” Melanie, The Fluff & Stuff Shop
Solution? Give Retailers the Opportunity to Sell The Diapers at that Price First
One option is to give retailers first crack at buying the diapers at that price. When I asked that, 85% of survey respondents said that they should do that. However, comments from manufacturers have indicated that when they do this, very few retailers take them up on that opportunity.
Customer’s Perspective: “I feel that offering retailers those steeply discounted prices would be a win-win-win situation all around. Manufacturers would be getting their advertisement out there in a place that is more likely to have repeat customers than a discount site. Retailers would be able to offer their customers excellent deals once in a while, also gaining repeat customers and gaining profit over all, and are not losing out because they end up troubleshooting for diapers that were actually purchased at their store. Customers get still get to have these awesome deals, but are also to physically handle the diaper and talk with an expert over the pros and cons before actually purchasing.” Anonymous Customer
Customer’s Perspective: “I think there needs to be a fair option for retailers to purchase diapers at a deal, too! I love my local diaper shop and go to them for most everything, but if I can snag a deal online to try a new diaper or fill a hole in my stash, I would. I want to do what is best for my family, and if I can, support my local shop and their families, too ” Anonymous
Customer’s Perspective: “Honestly, I have bought diapers from those deal websites, but I’d like to see the retailers, the small businesses, get that action. I feel that offering those discounts like that hurts the businesses struggling to break through in this country, and we need those businesses here. Otherwise there will just be a bunch of Walmarts and Targets.”
Customer’s Perspective: “Allowing the local retailers to opt into the steal deals will be beneficial to every one. The consumer will benefit because they will be getting the great deals along with the customer service and knowledge base that comes with purchasing from a local retailer. The local retailer will benefit because the value of the product they carry will not be diminished and new customers will be brought to the stores. Finally the manufacturer will benefit because their product will continue to be carried by retailers that care about the products they carry and will restock the diapers made by the manufacturer.” Anonymous
Retailer’s Perspective: ”I’m fine with deal a day sites offering discounted diapers. But I am NOT fine with the price being BELOW wholesale price. That just burns.” Retailer
Retailer’s Perspective: “Manufacturers need to make their money back in some way and I understand the interest in the deal sites. That being said, I think the companies should first allow their retailers to buy at the same super low price offered the deal sites and let them know that what ever is left will go in bulk to a discount deal site. This way there is no surprises which I appreciate as a retailers and it shows the company is making a solid effort to help their retailers first.
It’s possible that companies don’t like the image of clearance diapers on retailer websites and that’s why they would rather just go straight to the deal sites for a few days? I don’t know, it would make sense, but I know some view deal sites in the same manner as clearance diapers. While others view them as bulk ‘sales’ or ‘deals’ and not necessarily clearance.
Either way, with the cloth diaper industry as closely connected as it is within retailers, customers, manufacturers/companies, I would think it would be nice to offer the deal to retailers first and let us get the diapers out there.” Jennifer, Sew Crafty Baby
Manufacturer’s Perspective: “We have often done sales for our retailers at the same price we offer the deal sites with an allowance that they can offer a sale and VERY FEW retailers have taken us up on those deals. So I will offer a deal to our retailers and then they don’t take it, but then I get an angry email the next week when we do a deal site despite the fact I gave them the same deal” Anonymous
Is It Training the Customer to Expect Low Prices OR Letting them Try Something So They Can Then Use a Retailer?
Customer’s Perspective: “I think deal sites are a great “gateway drug” for hesitant parents to get into cloth diapering. Because these deals are unpredictable, I doubt anyone waits and buys a whole stash this way. However it’s great for all those moms sitting on the fence. They see a half off deal and jump on it, then find an online or brick & mortar retailer to build a stash.” Anonymous
Customer’s Perspective: ”I think any access to lower prices may start more familes cd’ing.” Anonymous
Retailer’s Perspective: “A customer that pays an extremely low price will not go back and pay retail prices later even if they like them, they will just hold out for another sale price. Nicole, The EcoChic Boutique
Retailer’s Perspective: “Even though those sites only have the sales on for a day or so, it makes the consumer expect to pay that little from a retailer. I’ve seen lots of people ask for help, then go to one of these sites or Ebay and buy discount diapers” Anonymous
Retailer’s Perspective: “There is the potential of devaluing a product when using deal sites or co-ops as it trains the public to not pay the full fair retail price for an item.” Michelle at Green Diaper Demos
Retailer’s Perspective: Customers say they want local cloth diaper stores, but then they aren’t prepared to support them. They feel ripped off when we have to charge a price that reflects putting stock on shelves for them to see, touch and compare, as well as staff on the floor to answer all of their questions. It’s a double-edged sword.” Tamara
How May It Impact the Manufacturer/Retailer Relationship AND What Retailers Decide to Carry?
Customer’s Perspective: ”Competing with other online diaper retailers is hard enough–there are many people without local resources always looking for the best deal. The constant selling of diapers and accessories on deal sites undermined the retailers who support these manufacturers, to me, does not show the manufacturers supporting them in return!” Nissa
Customer’s Perspective: ”I do not buy anything from daily deal websites. I have heard too many stories of small businesses failing because they sold too many items below cost and not enough at full price. I know cloth diapering saves parents money, but the lowest price is not what drives me to continue using cloth. Other people have a right to earn a living too.” Customer
Retailer’s Perspective: ”The constant deals teach consumers that the product and local retailer is not valuable enough to pay full price. I will be attending the ABC expo this fall and I have a list of questions to ask manufacturers before deciding to do business with them. At the top of the list is do you use deal sites to sell, promote or advertise your products. If the answer is yes I will not consider the line. If I am going to invest in and promote products I will not be doing it for a company that undercuts pricing they set.” Diaper Supply
Manufacturer’s Perspective: ”We are on a deal site today – not at lower than wholesale. I’ve gotten 3 extremely angry emphatic emails from retailers so far this morning. This is after I offered the retailers the SAME price I gave the deal sites and only one of our 200 smaller retailers placed an order for the sale price (only 50 retailers opened the email despite my titling it so they knew it was a giant sale from us).”
Manufacturer’s Perspective: “I’m not putting down all small retailers, but I’ve found that the stores that get the most angry about being hurt by the deal sites are also not actively promoting products in their own stores and I’ve come to suspect it has nothing to do with the deal sites and everything to do with how they market their business.”
Manufacturer’s Perspective: “I think it’s worth mentioning that every time we do a deal site we gain at least one new retailer who saw us on there for every angry email we get.” Anonymous
Manufacturer’s Perspective: “My diapers got on a small local news channel after someone purchased the products from a deal site and found out about my items. The small retailers in that area were super happy and made lots of sales. Then we do another deal site and the once happy retailers who benefited from the news exposure wrote me that day telling me I have degraded my products and they cant sell it anymore because after people see it on a deal site more than once people will never buy it at retail from them again so they were dropping our line and one even cancelled their next wholesale order. I can’t win” Anonymous
Is The Limited-Time Sale Really Hurting Retailers?
Customer’s Perspective: “The deals are a short lived limited special……I don’t feel it really hurts retailers.” Amilee
Customer’s Perspective: ”Although I see the perspective of the retailer, I feel that these extreme deals are few and far between for any one particular brand. They are often so short that they go unnoticed by most consumers and would not influence a great number of any one retailer’s customers. As a consumer, I do not have a bricks and mortar retailer that I can shop at, so I often shop around for the best online deal, as I am purchasing products, not services.” Karyn
Retailer’s Perspective: “Whenever any of the brands I carried went on a deal site, sales for me would cease automatically, and it would either be more than a month before sales started back again, or they wouldn’t return at all. I love companies like AppleCheeks, who are ALWAYS open with retailers and offer the same item to retailers first at a steep discount, telling us that whatever we didn’t purchase went to zulily.” Anonymous
Retailer’s Perspective: “Deal-a-day websites have severely hurt certain product categories of our retail store. One example…******* used to sell extremely well for us. We sold 4-5 ******** every day. Then they started showing up regularly on Babysteals. Our sales stumbled, then disappeared altogether. We literally gave away the last of our stock because even marked down to wholesale, it was still higher than Babysteals and we couldn’t sell it.” Anonymous
Retailer’s Perspective: ”I understand Manufacturers wanting to use deal sites – it gets product and name into homes that might otherwise not have been exposed. They can clear stock fast and make money to support new projects. I would support them if used maybe once per year and limit quantity per customer but any more often it’s a detriment to retailers. ” Diaper Supply
Retailer’s Perspective: “DiaperShops.com asked cloth diaper users in their 2nd Annual Cloth Diaper Pulse Survey <final results not revealed yet> that only 1% of the 3,000 survey respondents primarily purchase most of their cloth diapers from deal sites. (Printed with permission by DiaperShops.com)”
Manufacturer’s Perspective: “I wanted to put the information out there that often a deal site will overbuy and then run a deal more than once (without telling the company) so we’ll agree to do a deal site once and then Surprise! they’ve put us up again unbeknownst to us and we get the angry emails all over again from stores accusing us of doing “too many deal sites.” This has happened with two sites we’ve worked with (and they’re the two largest baby deal sites). I have no control over that, and while I have requested that they let me know if they have leftovers, they frequently do not let me know that at all. It annoys the heck out of me.” Anonymous
Manufacturer’s Perspective: ”I also got some complaints from stores that DON’T carry my products saying they never will because by doing a deal site they will NEVER be able to get retail price for my products if they resell. One of them went so far as to accuse me of taking money directly out of their local economy. This is insane! There are how many millions of people in the US ? Not everyone is checking deal sites every day - I certainly am not and I don’t know anyone that is who isn’t in dire financial straits and needs to survive that way. I know for sure that this doesn’t affect sales because even as our products are on a deal site, we are getting sales on our own website, so clearly, the entire world is not trolling for deals.” Anonymous
Manufacturer’s Perspective: “The retailers that complain the most are the smaller retailers who barely order anything from us anyway. The bigger stores and larger retailers that order a lot from us are unaffected by the deal sites, so I think part of the retailer upset is psychological. I honestly don’t think they are losing out on sales because we did a deal site. Our sales on our own website are generally up on the deal site days and those people are paying full price, and the week of the deal sites we usually get several re-orders from retailers, so I know it’s not hurting regular sales. When I’ve talked to people who buy on deal sites, most of them tell me they would not have ever purchased my product at full price anyway, so I feel like it’s a completely different market.” Anonymous
Manufacturer’s Perspective: “The retailers don’t seem to be having trouble selling my products at all (one of them was in the middle of reordering!) so I don’t see why a deal site for a second time is suddenly effecting them. The deal sites only take a couple hundred units at a time and I am only sending them maybe 1 or 2 skus – that’s barely a representation of all our customers (which are in the thousands) or all our products (12 skus). It feels like a stark overreaction that someone else is offering my products cheaper for an extremely limited time (less than 1 day). I tell them over and over that if they want to do a promotion to let me know and I’ll be happy to do something special with them – and no one takes me up on that offer but they’re happy to complain and drop my line.”
Allowing Diaper Makers To Quickly Move Old Inventory
Manufacturer’s Perspective: “In order to keep my company running, I HAVE to move old stock, period. As much as retailers might think I’m taking money away from them, I have to keep my company running. If the stores aren’t going to buy my old stock at a discount I have 5 people I employ (not counting myself) and we have to keep the wheels moving. If I don’t sell off the old stock I have 5 people who wont get paychecks and I can’t continue production of new items. That’s a huge responsibility for me.” Anonymous
Manufacturer’s Perspective: “As a manufacturer, the deal sites let me move overstock which I find especially useful if we need to do a packaging change, for example, so I can sell off the old packaging quickly. The deal sites – to put it into perspective – only take a few hundred units at a time. My company sells units in the tens of thousands so for us, it’s marketing/exposure and we can move our old stock.” Anonymous
Where Do Customers Then Get Customer Service?
Customer’s Perspective: ”I think that while the discount sites are great for building up a stash of diapers, it’s the personal help and experience of the independent retailers that further the use of cloth diapers by providing service and help to the consumer well past the date of order. The manufacturers should understand that without the independent retailer giving them a shout out, it would be a lot harder to get the word out about their product.” Anonymous
Retailer’s Perspective: ”It is my opinion that customers buying from a retailer will be more satisfied and buy more later because they are buying from someone that knows the product and will help them buy the right one, use it properly and work out future problems.” Nicole, The EcoChic Boutique
Retailer Perspective: “It’s overwhelmingly unfortunately, and ultimately unfair, to cloth diaper customers when they cannot receive the support they deserve in regards to their cloth diapering experience.” Kala, My Baby First
Retailer’s Perspective: It’s a horrible feeling after spending 2-3 hours with a mom teaching her about cloth to have her tell me that she is going to look for what she needs on deal sites and co-ops.
I think it is important for all of us to take a look at WHAT is going on in the industry. There are so many perspectives that we may not know about. There are some other useful articles about buying cloth diapers inexpensively (see below). While I am not saying buying inexpensively is BAD or that anyone should EVER feel guilty buying from websites, I do think we may purchase these items without fully understanding the impact it may have on the cloth diaper industry. I am grateful for the articles below that give us some more information on the impact:
Co-Op’s, The GOOD, The BAD and The UGLY Truth! - Cloth Diaper Geek
Cloth Diapers Made in China: What Every Consumer Needs to Know - Dirty Diaper Laundry
Are Cloth Diapers From China Bad? - All About Cloth Diapers
The True Cost of a Daily Deal - DFW Group
How the Retail Industry is Changing – Green Diaper Demos