The White House is announcing a collaborative project to reduce the cost of diapers for low-income families. (Photo: Jacquelyn Martin/AP)
Josh Miller, a White House official who helps with digital outreach, was thinking about diapers.
Miller, whose title is “director of product,” had been in on a discussion with his colleagues on the Domestic Policy Council. They were looking for ways to make diapers more affordable for the poor families who struggle to pay for them. President Obama would ask Congress for a pilot program to provide diapers for low-income families, but it was unlikely to pass. So Miller decided to reach out on Twitter to a company called Jet, an innovative, e-commerce startup founded by Marc Lore, the former CEO of Diapers.com.
Chris Ramirez, who works on Jet’s customer experience team, fielded Miller’s tweet. He was surprised that someone from the White House would pop up in his Twitter feed, but after some double-checking, discussing how Jet might be able to help with his problem, Ramirez says, “the conversation just took off.”
The result, to be announced today, is a wide-ranging collaboration among the White House, Jet, diaper manufacturer First Quality and nonprofits across the United States to lower the price of diapers for the low-income families who struggle to afford them. By modifying diaper packaging and streamlining shipping processes along the lines of on-demand models like Amazon Prime, the project will allow nonprofits to quickly buy diapers in bulk online for distribution to families who need the assistance.
The project is one of many recent collaborations between tech-driven companies and an administration that has often been stymied by congressional opposition. In snatching up technologists from high-profile Silicon Valley companies to work for the U.S. Digital Service, the president has begun building a “startup” within the White House that not only tweets and Snapchats, but also is increasingly addressing policy issues with private-sector solutions. The diaper program announcement comes just a day before President Obama attends the tech-heavy South by Southwest (SXSW) festival in Austin, Texas, where he will address the importance of civil engagement in the era of technology.
Though the collaboration may have started with a simple tweet, it’s rooted in detailed research by Megan Smith, an assistant professor of psychiatry at Yale School of Medicine. In 2013, Smith released a study that found 3 in 10 poor mothers could not afford an adequate supply of diapers, leading, understandably, to symptoms of depression and anxiety.
When Luke Tate, a senior policy adviser in the Domestic Policy Council, came across this research, he started looking into how this financial burden affects low-income families as a group. He found that in 2014, the poorest 20 percent of Americans with infants and toddlers spent nearly 14 percent of their income on diapers.
“The thing that blew me away though was that low-income families nationwide are paying on average $936 a year for an essential good that’s comparable to a utility,” he told Yahoo News. “I’m thinking [my family is] paying half that.”
That difference in price, he discovered, was because poor families can’t take advantage of on-demand shipping services like Amazon Prime. Those who can afford to subscribe to such services, have Internet access to use them, and live in buildings where packages can be delivered are able to save money by buying essential items such as toilet paper in bulk. By comparison, those who don’t have those advantages — both poor families and the charities that assist them — pay on average almost twice as much per diaper.
“It’s just an incredible and jarring illustration of how expensive it is to be poor,” Tate said.
Traditionally, the Domestic Policy Council would address an issue like this by identifying a public program, like food stamps, and writing a provision for diapers into the president’s budget proposal. But according to its director, Cecilia Muñoz, congressional intransigence on the budget has led her office to turn to more innovative methods.
“When you think about it, we’ve been finding creative ways around the obstacles in this town for seven years,” she told Yahoo News. “This is just the latest example.”
So Muñoz’s department turned to the Office of Digital Strategy, a group best known for heading the White House’s social media channels. Using his experience as a former Facebook employee, Miller visualized this diaper problem from the perspective of “the user.” In this case, that meant the nonprofits that lacked the space to store bulk shipments of diapers, or access to on-demand purchasing that would make a warehouse unnecessary. He figured Jet, which specializes in reducing product costs by finding more efficient ways to ship and package items, was the perfect business to collaborate with. And the company agreed.
“What made this so compelling is how well it fit with our core focus here,” Dana Hork, the brand experience director at Jet, told Yahoo News. “We find scalable and sustainable advantages for our customers. Developing a more cost-effective diaper for a family in need was a very natural extension of our main focus.”
Jet set up a 10-person team to figure out how to reduce the price per diaper without sacrificing quality. To do this, they contacted First Quality, the company that manufactures Cuties diapers, and began to brainstorm ways to redesign the packaging in a cost-efficient way. They eliminated some of the high-resolution images printed on the packages that are sold in stores, and they increased the number of diapers that could fit into each box, cutting the unit cost for nonprofits from about 50 cents to 13 cents.
Meanwhile, Jet set up a separate page on its website, where any nonprofit can register to access these heavily discounted diapers and receive them within 48 hours with free shipping. So far, it has partnered with the National Diaper Bank Network, which, according to White House Chief Digital Officer Jason Goldman, estimates that its locations will order more than 15 million diapers through this program this year.
Goldman, who has overseen partnerships with Instacart and Kickstarter to aid with the refugee crisis during his past year in the White House, said that the success of private sector collaborations depends on framing issues in a way that allows companies to address them head-on.
“We know that people get outraged about 2x pricing on Uber,” he told Yahoo News. “But they just aren’t aware of the fact that low-income families have to pay more than that surge price on diapers. Contextualizing the problems in terms that [companies] understand helps people really think about the greater challenges that aren’t being tackled.”
Goldman hopes to address more areas of need with the help of Silicon Valley talent in the coming year. And his office’s recruiting process will be center stage at SXSW, when Obama delivers a keynote speech there on Friday.
“This is obviously one of the big reasons we’re going to SXSW,” he said. “So the president can have a conversation there with the world leading innovators and thinkers and entrepreneurs — folks who think creatively about problems that have seemed entrenched for a long period of time. That’s like the spirit of entrepreneurship that’s fueled not only the tech sector’s growth in the last couple of years, but is endemic to the American character.”