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FW in the News

The NY Times Magazine had an article that featured FW. See below for full text of Collective Bargain Hunting.

Collective Bargain Hunting
By Rob Walker
Published: September 18, 2005

FatWallet.com

Consumers have always skirmished with the retailers and producers they buy from. In the late 1940's, shoppers opposed to the rising cost of meat used technology to spread their protest message. A temporary boycott apparently started by one woman in Dallas led to a " 'chain reaction' by telephone," according to an article at the time, with each participant pledging to make 10 calls to spread the word. Other reports found the boycott "growing like a snowball" to more than 40 cities in a few weeks. "Buyer Resistance Cuts Meat Sales Throughout Nation," said the headline in The New York Times on Aug. 15, 1948.

Nearly a half-century later, consumers still make the most of technology to battle high prices. One example of what has changed, and what hasn't, is the Web site FatWallet.com. Founded in 1999 as a hobby by a Web developer named Tim Storm, it now has 370,000 registered users and about 30 employees. FatWallet performs three functions. As an "affiliate" of various online retailers (including Staples, Dell and Target), it earns a small commission on sales it makes through its site, which it splits with its users in a "cash back" program. It also has an area where online coupons and special sales are announced. But the most interesting - and potentially subversive - thing is the forums section. There, consumers themselves have tracked down bargains and decided to share them with others. Some of these users are definitely "deal-hunting addicts," Storm says, and their forum interactions are "the heartbeat of the site."

This summer, for instance, a FatWallet user called dogpurple posted a notice titled "FREE OfficeMax $10 gift card from D.H.L.," including a link to a D.H.L. customer survey. Scores of responses followed, and while D.H.L., the shipping company, evidently wanted "to better understand what you're looking for in an importing partner," as one post put it, the FatWallet crowd had a different agenda. In the words of one user, "45 seconds for $10 - wish I could get a full-time job that paid this well." One busy survey taker claimed to have amassed 55 gift cards - and a dirty look from the D.H.L. driver who delivered them. This was followed by a brief and ultimately inconclusive ethical debate.

Many posts on the site involve straightforward notices of free samples or discounts, but at least some businesses are deciding that deal addicts are a problem. The most famous example is Best Buy, which booted FatWallet.com from its affiliate program last year as part of a larger effort to identify, and get rid of, its least profitable customers, at least some of whom seem to be the sort who use sites like FatWallet, SlickDeals.net and others. Best Buy's dump-the-bargain-hunters campaign has been shaped by the thinking of Larry Selden, a Columbia University business professor and an author of "Angel Customers and Demon Customers." Storm, of course, does not think his FatWallet users are demons. He argues that all his site does is amplify the deals offered by the merchants themselves, and that for the most part those merchants are rewarded by "real consumer traffic." Storm also points out that FatWallet played a role in exposing a scam artist who was later convicted of fraud.

But for the most part, FatWallet users seem focused on bargains and prices. The meat strikers of the 1940's were focused on prices, too, but the difference may be that the prevailing idea of consumers (and how they think of themselves) has evolved, a shift that is explored in the book "A Consumers' Republic," by Lizabeth Cohen, a Harvard history professor. At times, a kind of "citizen consumer" notion has been dominant - the meat strikes are one example. But at other times - and particularly now - a "consumers' republic" idea has dominated, stressing the economic importance of stimulating consumers, not protecting them.

Shoppers still battle corporate sellers for the upper hand, but the users of the deal-hunt sites seem closer to guerrilla-strike consumeristas than an organized force trying to change a system for the betterment of all. Basically, Cohen says, we live in a different era, and the guiding question is not "Is everyone being treated fairly?" but rather "Am I getting the best deal?"