Amazon Mishandles A Necessary Change to Amazon Mom

I’ve written before about the Amazon Mom program.  When it first came out, the deals were too good to be true.  They basically gave a free year of Prime shipping benefits, plus 30% just about any baby item, namely diapers.  As soon as the program came out and I found out about it, I signed up, and we’ve saved plenty in the meantime.

It was such a good deal that I figured it would really have to pay off big for Amazon, otherwise they’d probably scale it back or eliminate it.  I noticed the first signs a few months ago when some of the deliveries seemed to be taking place by non-traditional (read: cheaper) carriers.  Next, they cut the discount from 30% to 20% on items you weren’t already buying.

So, the e-mail I got last Thursday wasn’t really a big surprise:

The Amazon Mom program is changing in 2012 and we want to make sure you know about it. Some of these changes affect your membership. Here’s how:

  • Starting on January 24, 2012, the maximum discount available on diapers and wipes subscriptions will be 20%. This includes a 5% Subscribe & Save discount plus an additional 15% exclusively for Amazon Mom members who are earning free shipping benefits or have an active Amazon Prime membership.
  • Customers who join Amazon Mom in 2012 will get three months of FREE Two-Day Shipping benefits. Once the initial free period is over, customers can join Amazon Prime to continue to receive full access to Amazon Mom and Amazon Prime benefits.

Since your free shipping benefits have ended and you have not yet joined Amazon Prime, the additional 15% Amazon Mom discount on diapers and wipes subscriptions will expire on January 24, 2012.

We hope that you have enjoyed the value and convenience of your Amazon Mom membership over the past year. To continue receiving all the benefits of Amazon Mom, join Amazon Prime for $79/year. As a Prime member you’ll receive:

  • 20% off diapers and wipes subscriptions with Amazon Mom and Subscribe & Save.
  • FREE Two-Day Shipping on millions of items.
  • Unlimited instant streaming of thousands of videos with a wide range of content for the whole family, including Sesame Street and Phineas and Ferb.
  • A Kindle book to borrow for free each month from the Kindle Owners’ Lending Library.
  • Membership sharing benefits: invite up to four household members to share your shipping benefits for free.

Long story short, in order to get even the 20% discount, you have to pay the full subscription price for Amazon Prime.  To add insult to injury, Amazon also made it so you couldn’t get an ‘extra shipment’ of any item you were already subscribed to, effectively ending the program immediately.

Now as I said before, I get that they needed to make changes to the program if it wasn’t making them money.  My guess is that they hoped that the people that joined would buy a lot more, offsetting the ‘loss’ they were taking in the deep discounts.  I’m guessing that didn’t happen so the company felt it was costing them money.  Therefore, I can’t agree with the many other members who feel that Amazon should re-instate the program at no cost.  It doesn’t make sense.

I also get why they had to put a lid on the extra shipments.  You figure that if they gave people two weeks, people would simply stock up on items in advance of the January 24th cut-off date.

However, now that I’ve given reasons I sympathize with their decisions, I’ll say this:

I still think Amazon blew it.

Let me explain.

MSNBC.com wrote an article in the thick of the holiday shopping season about how mommy bloggers are becoming the biggest voice of influence when it comes to toys, and other kids products.  I have no proof of this, but I’m going to guess that 90% or more of mommy bloggers who have kids in diapers were a member of Amazon Mom.  Those mommy bloggers, who have a powerful and very fast growing voice, are now certain to express their displeasure to their readers.  Personal finance bloggers (of which I am of course one), are probably not far behind and are going to share their similar displeasure.

If Amazon doesn’t think that this will make a difference, they might want to take lessons from two little companies called Netflix and Bank of America, and how their unpopular decisions cost them big time.

I think Amazon needed to change the program.  I think with a couple of simple tweaks, they could have had a much more positive reaction.  If anybody at Amazon is listening, here’s what should have been done:

  1. The reduction from 30% to 20% on items was fine.  However, it should have been more properly communicated.  They never sent an e-mail or did anything to explain it, so when I went shopping and found new items were coming in at a bigger cost, this seemed a bit underhanded.
  2. If Amazon wants more Prime members and wants Mom members to pay the Prime membership cost, fine.  However, I think they should have offered Amazon Mom members a discounted membership, either by lowering the cost from $79 to $59, or by charging the full amount and offering an immediate $20 credit toward diapers or other baby items.
  3. As I said, I understood why they couldn’t allow people to stock up on items at will between 1/12 and 1/24, but they should have allowed each customer to purchase one item as an ‘extra shipment’ between those dates.  Personally, I set every item in six month intervals, and did all my ordering by adding ‘Extra Shipments’.  This worked out good for me because I never failed to miss an alert and therefore didn’t end up with product I didn’t need.  However, I knew that we would need a pack of nighttime diapers for our son soon, and planned on ordering them…this week.  Now, I can’t.  By allowing one purchase per customer, you allow the program to truly continue until January 24th.  By cutting that off completely, the January 24th date is just lip service.
  4. They should have agreed to price match in the event that customers were able to obtain better deals.  One of the common things I’ve seen in response to this change is customers who feel that there’s a chance that Amazon could get customers to pay into Prime, then raise prices even more so that the 20% isn’t truly a 20% discount, making the payback period such that it might not be worth it.

Would all Amazon Mom participants have stayed on board with the changes above?  No, of course not.  But, I’ve seen nothing but complaints blowing up all over the Internet since this was announced.  I think if they would have handled things as I suggested, you would have seen a lot more responses like ‘Oh that sucks, but I understand why Amazon is doing this, and they are showing that they want to do something for people in the Mom program’.

That would have been the tone of this article, anyways.

As it is, I’m not sure what we’ll do.  I’ve been debating getting a Prime membership anyways, so if I were to go by that standard, this would push me into getting one.  However, the way Amazon has handled this has actually disappointed me to the point where I don’t feel that they should be rewarded with a $79 charge.

It’ll definitely be something my wife and I will be talking about over the next few days.

Are you an Amazon Mom?  What are your plans for the changes?

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Do You Have The Money Habits Of A Two Year Old?

Our two year old boy is so much fun.  He discovers new things and finds new interests every day, and he loves sharing them with us.

He’s also learned the words ‘want‘ and ‘need‘ and isn’t afraid to pull those out any time something tickles his fancy.  And when he ‘wants’ or ‘needs’ something, it’s a broken record until he gets what he wants or until we redirect his attention elsewhere.  “I Want Snack, I Want Snack, I Need Snack, I Need Snack”

You get the picture 🙂

You see that behavior and you automatically think “That’s just a phase.  Everybody grows out of it.”

Or do they?

Because I got to thinking about it, and it kind of scared me because many people don’t get out of that habit and that’s exactly how they get into overwhelming debt.

Think about this line of thinking:
“Wow, that TV is really cool.  I want that new TV.”
“That TV I saw earlier was awesome.  I really want that new TV.”
“Trying to watch the big game on this junky old TV is nuts.  I need that new TV.”

It’s “I want” and “I need” all over again!

The only real difference, in fact, is that the two year old often can’t get what he or she wants, but the adult can whip out a credit card and satisfy their want/need!

It just goes to show that the behavior of repeating “I want” and “I need” might subside over time, but the actual wants and needs are still there.  Controlling them is the biggest key.   Teaching our children the ability and the benefits of self-control is paramount to future ability to make prudent financial decisions, because let’s face it, the “wants” and “needs” are here to stay!

So while it’s a little too early to have the ‘stay out of debt’ and ‘spend responsibly’ conversations, it is eye-opening to realize that there are a lot of lessons that we’ll need to teach our children!

Have you seen little kids behavior that translate into habits that can carry over into adulthood?  Discuss!

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Our Son’s First Money Lesson

Little Boy Beagle just turned two last month.  One of his favorite things (and he has LOTS of them!) is to get a pony ride at Meijer, which is our grocery store of choice.  One of Meijer’s traditions is that they have a little horse ride for kids at all of their stores, and they’ve always been a penny per ride.

Recently, I went on a shopping trip and got to take him on his pony ride.  As soon as he sat down he started pressing the button that makes it go.  It didn’t go, of course, until we put the penny in.  So, before we started, I explained to him that we have to put money in, and that we have to pay for things that we want with money.  Together, we put the penny in the slot, at which point the button lit up and he was able to press it to start his ride.

After the ride was done, he kept saying ‘Money’ and pointing to the slot where the penny goes.  I told him that we only had enough money for that ride.

How much of this did he actually get?  Who knows?  Probably a lot.  He gets so much more than we give him credit for.  All I know is that it was a pretty cool first lesson for money, one that I’ll have to remember to teach all of our kids as I sense this will be a tradition!

What kind of money lessons have you taught your young kids?

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