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Gray-Market Goods: What’s the Real Deal with Online Resellers?
08/25/2008 - By Melissa E. Malka With all the conflicting information on gray-market scuba gear in the online marketplace, I took a closer look. Here’s the unbiased scoop on a pretty blurry and somewhat controversial topic.
A quick search on Google for “scuba gear” quickly brought up a countless number of online stores each claiming the “lowest price” on name-brand dive equipment. With so little information out there on who is an authorized reseller or not, it’s hard to ensure that we’re getting the product quality we’re paying for. I did some digging to find out some more information on a pretty gray subject…no pun intended.
A closer look into gray market goods, goods obtained through unauthorized means and then resold, reveals that most dive gear manufacturers do not support warranties for these goods. Gray-market dealers are typically online, and in contrast to the familiar brick-and-mortar dive stores, they only sell you the product – no services are provided. Some of these dealers may obtain name-brand gear not as authorized resellers, but by either purchasing from authorized resellers as wholesale, buying gear second-hand, or purchasing the stock of a store that is going out of business. Although the actual dive gear is legitimate, many are missing the crucial warranty card, the important point of contact between manufacturers and consumers.
Buying from unauthorized dealers is hit-or-miss, you can get lucky and get a good set of regulators at a can’t-be-beat price, but with dive gear essentially a form of life-support, do you really want to put your faith into something with unknown origins? Important recalls put out by manufacturing companies may fail to make your attention, especially if you have unregistered equipment or equipment that was registered to someone else.
Certain dive gear manufacturing companies are taking a stand against these products. Aqua Lung, Sea Quest, SCUBAPRO/UWATEC, and others have released letters stating that they will not uphold any warranties for equipment purchased from an unauthorized reseller. It’s not as capitalist as you think, because although the companies’ brand equity can be damaged from substandard gear obtained from these sources, a company representative informed me that they are equally concerned with supporting the local dive stores that sell their products, the stores that are affected by gray-market online dealers, than they are with their product distribution.
I was able to speak to Tom Phillipp, Product Manager of the Pro Dive Division of Aqua Lung, and he stated, “Aqua Lung supports brick and mortar storefronts, stores that provide the services to keep our industry thriving. These stores have a large amount of overhead to keep their lights on everyday; from equipment to staff and instructors – after-sale services that they provide are needed to keep this industry functioning.”
Phillipp’s message is dead-on, most dive stores are Mom & Pop shops that need the support of their local dive community to remain in business and in exchange, they usually provide an all-in-one place where you can learn how to scuba, buy gear, rent tanks, and get your equipment checked and serviced.
There’s another side to this market as well. After further research, I learned that not all of the products obtained from online resellers are gray-market goods. In order to prevent online resellers from selling unauthorized goods that may be of substandard quality, some companies are collaborating with the online stores. By doing so, the manufacturers are able to better control the quality and sale price of their gear, and the online resellers are held to the same agreements as a physical store.
Doug Krause, Marketing Manager for Oceanic/Aeris, said, “The gray market is not going to go away, at first it was mail-order, now its the Internet. We can either turn a blind eye to it or we can try and create a solution that is going to benefit the manufacturer, reseller, and consumer. By holding our authorized online resellers to the same standards as any other authorized reseller, we ensure a fair price and the same product quality.”
Although they may have taken a different approach to combat the issues associated with gray-market goods, Oceanic still do more than their share in supporting smaller dive shops, the scuba dive industry as a whole, and the consumers that support their company. Just check out www.scubaboard.com’s forums and search for “Krause”, Oceanic’s Marketing Manager mentioned above. At the date of publishing, he has personally responded to 184 threads on the site, and I’m sure a countless number of e-mails in relation to his posts.
Bottom line: Do your research!
Companies are upfront about providing information about their authorized (and unauthorized) resellers, online or brick-and-mortar. Don’t hesitate to contact the manufacturer with questions because ultimately, they strive for the utmost customer satisfaction and product quality. While certain goods sold in online stores may be legitimately obtained, others may have sketchy origins. If the dealer is authorized, you’re sure to get a quality product and a full warranty. I’ll try to help keep things up to date by posting a list of companies that have authorized online resellers.
If you have any questions or comments, please e-mail me at melissa@diveshops.com
-- Mel