That home made diffuser looks very effective!
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nflatable soft boxes are working very well for me. However to get a genuinely soft light, I applied white duct tape to the front of it (they are a bit too transparent to really diffuse the light).
Another thing I've been trying is a tupperware box, with a hole cut for the flash at the back, and a sheet of thin white paper in front to diffuse the light. Works great but looks terrible!
I haven't tried a stofen-type of diffuser (which fit directly on the front of the flash). To me they look too small to effectively diffuse the light. I would avoid them, they look useless! The goal is to increase the area of the light source.
Of course one of the simplest and best things you can do indoors is bounce the light off a wall or ceiling.