Retailers battle for new moms' money
New parents can reap extra rewards as retailers respond to price changes at Amazon's Mom club by improving their own deals.
This post comes from Kelli B. Grant at partner site SmartMoney.
The first year of parenthood can cost parents $11,950, according to the latest figures from the U.S. Department of Agriculture, and the costs only go up from there. Hooking a new parent early can mean thousands in revenue for a retailer over time. "They get several good years out of many new parents with baby-oriented products, and often a long-term spending relationship," says Kit Yarrow, professor of psychology and marketing at Golden Gate University in San Francisco.
Parents also often shift their spending to the same store to avoid making separate trips for diapers and paper towels. "You have a captive audience," says Angela Wynne, the founder of deal site BabyCheapskate.com.
Competition has gotten even fiercer recently. Both Babies R Us and ShopRunner.com launched initiatives aimed at new parents on Thursday, amid backlash from moms over changes Amazon made to its Mom club in late January. Instead of 30% off select diapers, members now get 5% off, plus an extra 15% if they sign up for a $79 Amazon Prime account. New Amazon Moms also get three months of free two-day shipping, instead of the previous one-year offer. (Amazon did not respond to requests for comment.)
"Amazon has given us an opportunity," says Fiona Dias, chief strategy officer for shopping service ShopRunner.com. The site, which regularly costs $79 a year for free shipping, free returns and exclusive deals at partner stores such as Toys R Us and Drugstore.com, is currently offering parents a 90-day free trial instead of the usual 30 days. Those who make a purchase of $50 or more during the trial get a full year of membership free. (Post continues below.)
At Babies R Us, the new V.I.B. (Very Important Baby) program awards a 10% bonus on funds loaded to a store card for spending on diapers, wipes, formula and baby food. Parents can receive up to $200 in bonus cash each year, says chief marketing officer Greg Ahearn.
But while the wealth of new-parent deals can make a dent in the estimated $2,000 cost for a year's worth of diapers and formula, they can also make it easy to overspend on everything else. "There's a very strong nesting impulse in new parents," says Yarrow, and it's easy to view discounts as an offset to inessential spending.
Programs may also encourage loyalty -- or force it, when there's a membership fee involved -- in situations where parents would be better served by shopping around. Indeed, parents might be better off buying, say, diapers at different retailers. Huggies Little Movers, for example, range from 18 to 27 cents per diaper, depending on the sale, says Wynne.
ShopRunner.com points out that it uses several retailers, so parents aren't locked in and can cut costs on other online shopping expenses. Ahearn of Babies R Us says shoppers can join for free and add money as needed.
Shoppers should also look to stack deals, combining store loyalty programs with manufacturer's coupons, store sales, brand rewards and other discounts. Baby-product brands including Huggies, Pampers and Stonyfield Farm offer their own loyalty programs that can yield freebies and other coupons, says Darcy Cruwys, founder of SwapMamas.com. Moms often use the site to swap those reward codes with each other to rack up deals faster, she says.
More on SmartMoney and MSN Money:
Copyright © 2014 Microsoft. All rights reserved.
ABOUT SMART SPENDING
LATEST BLOG POSTS
VIDEO ON MSN MONEY
BLOGS WE LIKE
MUST-SEE ON MSN
A charcuterie master shares his process for cold-smoking meat at home.
- Jetpacks about to go mainstream
- Weird things covered by home insurance
- Bing: 70 percent of adults report 'digital eye strain'