Amazon dumps its private label diaper line
Those who thought Procter & Gamble and Kimberly Clark didn’t have much to worry about when Amazon.com launched its new Elements premium private label disposable diapers in early December appear to be right. Amazon has discontinued sale of the diapers following complaints by consumers of poor quality (not something you want in a diaper).
Yesterday, Amazon notified Prime members who had subscribed to receive the diapers that it was discontinuing the line to work on design improvements. Affected customers were offered a $25 Amazon credit and were told the e-tailer would like them to try the next version of the diapers when ready to be introduced.
According to Profitero, Amazon’s dumped diapers had a rating of 3.4 stars out of five based on 81 reviews.
While its diaper line didn’t pass the quality test, it appears as though Amazon’s Elements line of baby wipes is faring better with Prime members. Items in the line all have ratings above four stars.
- Will Amazon’s new private label give Pampers a run for its money? – RetailWire
- Amazon Elements – Amazon.com
- Amazon Pulls Its Line of Diapers Less Than Two Months After Launch – Re/code
- Amazon pulls its diaper brand after six weeks, citing design flaws – GigaOM
- CPG eCommerce Intelligence: Why Amazon pulled its Elements diapers – Profitero
Discussion Questions
What do you make of Amazon’s decision to pull its Elements diapers from the market so quickly? Will Amazon be able to reintroduce its Elements diapers successfully following its initial design flaws? How will this experience influence Amazon as it moves into private labels in other areas?
Amazon is learning that customers’ appetite for its own private-brand products is limited if the product quality and utility aren’t right. The Fire Phone was a prime example, and Elements diapers appear to be another. Any retailer venturing into private-label goods needs the patience to put in the effort on R&D and other product development to provide a product superior to the national brands.
Just because you can do something doesn’t mean you should.
It will be a tough but not impossible task to re-introduce, although it sounds like they are doing what they can to get their shoppers to be ready and willing to re-try. Shame on them for not introducing a quality product. The days of private labels being cheap knock-offs seems to be over, especially if you listen to those who comment here on RetailWire.
After two kids and a few grandkids, I’ve probably changed at least a dozen diapers and purchased hundreds more. I have yet to see a decent private label diaper. Its like the private label manufacturers go out of their way and purposely make a poor quality diaper to frustrate consumers. Amazon would not be the first company to be embarrassed by private label diapers. Always a good idea to distance yourself from poor-quality products. Amazon’s best bet is to sell name-brand diapers at break-even or less. Even at retail, baby products are a loss-leader to get moms in the store. If moms knew that the the cheapest and best diapers were the ones that Amazon delivers to their door, it would go a long way in winning over mothers.
Smart to learn to fail fast. The impact will be more positive than negative. The message I get is we want our brand to stand for quality and we will stand by our values.
Considering that Amazon’s private label consumables have been rumored for over a year, it was a bit surprising that the diapers had quality issues that hadn’t been resolved before launch.
That said, retrenching to focus on quality is the right move, and prompt action is a better path than letting the new brand languish (or worse). Especially given Elements’ “premium” positioning and the sensitivity around safety and dependability in this category, there’s almost no alternative.
Long-term, private label could potentially play a key role in Amazon’s assortment and margin mix, as it does for nearly every other grocery retailer. But there’s a learning curve, especially when aspiring to anything beyond a generic national-brand-equivalent label.
Amazon management has shown a willingness to take risks by introducing products into the marketplace and then seeing how consumers respond. Some are hits (Kindle) and others are misses (diapers and phones). By acknowledging, without excuses, that their current diapers are not meeting consumer expectations Amazon has gracefully exited and leaves the door open to return, once the diapers have been redesigned. I don’t think this will have a negative impact on the Amazon brand, provided that future products meet or exceed customer expectations for quality and value.
The private label diapers simply did not live up to the claim of being a “premium product.” Amazon was correct in pulling the line out—it doesn’t meet their brand promise and they opted to fail fast rather than pushing through a redesign while keeping a less-than-satisfactory product on the market.
I expect Amazon to successfully re-introduce a much better performing private label diaper line. The opportunity in both growth and margins are too attractive for Amazon not to do so.
I would be interested to know how many cases of diapers Amazon sold before they decided to pull them from the market as well as how much product testing was done pre-launch. It seems like this was simply a matter of entering the market too quickly. While I don’t think there will be too much harm done, particularly considering the $25 gift card and the invitations to test the new and improved product once it is out, but it was rather shortsighted of Amazon not to invite diaper-buying customers to test the product before it was widely released.
Amazon has an incredible amount of data on its customers, particularly Prime and subscription users who make repeated purchases. Surely it would have been easy to offer to send customers a small trial pack of diapers in exchange for feedback. Hopefully Amazon will take advantage of feedback from their most loyal shoppers before releasing new products in the future.
Good decision to withdraw and fix. Nothing worse than irate parents using faulty diapers. The key is to avoid the marketing fiasco that Scott Paper endured when it didn’t pull its defective Scott Diapers in a timely manner, resulting in a deleterious impact on all Scott brands.
Consumers seem to value the rest of the Elements line. If re-engineered properly, I do not predict any long-term negative impact.
I would not bet against Amazon. P&G as well as KC need to stay vigilant.
This is no different than what we have been preaching for years. Quality, quality and more quality is the base requirement for private label. Fact is Amazon should have customer-tested the product before they signed the contract. If a product fails then the new, improved one will likely fail as well. Amazon miss the boat with this product, they should just move on to the next one.
They will/should not be planning to reintroduce this line. What are they going to gain by trying to be the best at something out of their comfort zone? Can you imagine what would happen if a company like P&G tried to get into the e-book business?
I am not surprised to read of the failure. I am surprised that a company like Amazon would not have done a better job of product testing and marketing. Maybe they got caught up in their own ego.
Amazon can’t risk a mediocre rating on a “mom essential” like diapers. Just ask any person who looks after a baby all day (by this I mean cleans up after)! Imagine, if you will, a nanny of twins for a working mom,who decides to quit over this kind of an issue. Amazon wants no part of that kind of a story or review!
Admitting the quality issue and explaining that the diapers are being pulled to make way for an improved version will help. However, if the fix were quick, Amazon could have just made a substitute of new better-quality diapers. The lesson is that convenience and price can not be at the expense of quality, or that there is a level of quality below which price and convenience advantages are not enough to influence purchase decisions. For branded manufacturers the message is that satisfying consumers’ wants, needs and desires is critical, that competitors will work to meet those standards, and that it is important to keeping improving products and services.
This is a fantastic story for Amazon to use as an example for their big picture advertising campaigns. As for their private label baby products it demonstrates that they are willing to take chances, and mothers and fathers are not too keen on experiments of any kind involving their children. The problem is also exasperating for growing families with reduced incomes and little or no recovery funds. This demonstrates a need to add quality control to the company purchasing plans with as much leverage as the price point side of the equation.
Always a good idea to dump a bad product, especially when it is a highly visible one and/or one used by children.
As to whether or not the brand can come back—Americans love second acts.
I hope the Elements experience sounds a cautionary note at Amazon—”Always look (and test) before you brand.”
Lesson learned: Good combinations of quality and prices sell. Bad ones don’t.
Expect that customers might be willing to give them a second chance, but at that point any halo goodwill from other PL products runs out.
Hopefully they will have learned that their name may get product trial, but they have to meet expectation to get adoption.
I think this is a good move for Amazon. Keeping a poorly performing product on the market only damages brand value. They certainly did the right thing by offering a gift card to affected customers. Amazon tries to dabble in every type of product and technology, but pulling the plug on ones that don’t work is the best option to maintain customer trust and loyalty.
It would seem that diapers would have been one of the easier products to test for quality and effectiveness before introduction to the market. Diapers really don’t involve personal taste or style. They just, you know, have to work. The big question, then, is how did this fiasco happen? Amazon did the right thing to pull them quickly, though.
It demonstrates Amazon’s being true to being consumer-centric and a learning company. If something does not work, they seem to be OK to drop it, admit it and hopefully learn from it.
That being said, constantly failing will definitely have the consumer re-think the next time Amazon launches something. They may not trust them easily and might wait and watch.
A great opportunity for other retailers who really take the time to focus and do a good job on their product development initiatives.
Just goes to show that while Amazon may sell everything, it’s not easy to be good at everything. They can afford to keep trying as long as their valuation supports it.