WSJ's Ante Discusses 'Flash Sale' Sites

Melissa Block speaks with Spencer Ante, deputy bureau chief of the Wall Street Journal, about "flash sale" websites. The sites give bargain hunters a chance to buy high-end goods for low-end prices.

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MELISSA BLOCK, HOST:

From NPR News, this is ALL THINGS CONSIDERED. I'm Melissa Block. And it's time now for All Tech Considered.

'Tis the season for shopping and, if you can, saving a buck or two. That's why some people are turning to websites that offer limited-time discounts, called flash sales, giving bargain hunters the chance to buy high-end goods for low-end prices.

Spencer Ante wrote about the flash sale model in the Wall Street Journal. And he joins me now.

Welcome to the program.

SPENCER ANTE: Thank you, Melissa.

BLOCK: And I'm looking at one of these websites right now, Fab.com. There are a lot of others: Guilt.com, Rulala.com. Walk me through how these work.

ANTE: Sure. So this is a relatively new phenomenon. A few years ago, a bunch of these sites started popping up. And what they do is, they offer consumers the ability to purchase any range of goods - clothing, art, jewelry - for a limited time. You can go on a website and basically try to buy a product, you know, over a day or two days or three days. And the reason that these sites have taken off initially is because they typically offer heavily discounted prices on luxury items, in particular.

BLOCK: And how are the sites getting the products that they're selling?

ANTE: Right. So, you know, just remember a few years ago - and even today, we're still in a very soft economy - but we were in a recession in the U.S., you know, in 2007, 2008, 2009. And so that provided an opening and an opportunity for these sites to emerge. And basically, what they did was, they purchased a lot of the excess inventory from the luxury, you know, apparel makers and other luxury goods makers.

So they bought them all up, and then they basically resold them on the Internet for a decent margin.

BLOCK: And is that when this business really took off, flash sales?

ANTE: Yeah. Yeah, it's no surprise that it took off during that time. But, you know, now that we're coming out of a recession, you know, the question for a lot of these sites is: Can they make this transition from an economy where they benefited from this excess inventory, to an economy where a lot of those product makers are curtailing the amount of excess inventory they put on the market, which is obviously going to drive up prices.

BLOCK: I wonder, though, if shoppers are used to getting free shipping and free returns, which it doesn't look like these sites offer - at least, not the ones I've been looking at - maybe the prices aren't such a great deal anyway.

ANTE: Yeah. That's a good point, Melissa. You know, I think we're seeing the strains of this transition. And what you've seen, as you noted, is that, you know, if you're a pretty diligent shopper that, in some cases, you can actually find prices on these goods that are offered on flash sale sites on other websites for sometimes cheaper - you know, just on the flat price of it. And then other times when the prices are equivalent or near equivalent, if you factor in the shipping charges or their return charges, then you can actually sometimes find a better bargaining not going on a flash sale site.

But I would also say that the flash sale sites, they're not stupid. And so many of them are - have been sort of making this move to basically sell full-priced goods.

BLOCK: Spencer, are you a flash site sale shopper?

ANTE: I've used these sites occasionally. I'm not a huge flash sale site shopper, to be honest with you. I think one of the challenges with these sites is that - especially with things like Groupon, which sort of has a flash sale model a little bit - you know, it's all about getting the right product in front of the right customer. And a lot of these sites have not done a good job at figuring out what their customers really want.

And so, you have these situations where I'm getting, multiple times a day, offers for spot treatments, or facials, or things like that - which I'm not really that into. So maybe if they did a better job of targeting what I'm interested in, then maybe I would use them more.

BLOCK: I've been talking with Spencer Ante, editor and reporter with the Wall Street Journal, about the popularity of flash sales online.

Spencer, thank you.

ANTE: Thanks, Melissa.

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