Are Rebates Scandalous?

theodp asks: "Motley Fool offers a dead-on take on the computer mail-in rebate fulfillment process--Once I receive your 'claim,' I will begin to 'process' it. Assuming that you filled out all the information correctly, and assuming nothing is missing, and assuming your claim doesn't get lost somehow, and if you call or write a few times to check on your claim's status, then I will mail your check within 10 to 12 weeks. Maybe. Or maybe it'll be four to six months. Or never." What are your thoughts on rebates, and have any of you noticed who, at least in the computing industry, is more trustworthy with rebates than others? Update by J : Here's the short version of the article.

Comments

rebates are a total waste of time

[Alpha27]

At times I forget to send them in. What should happen is the selling company, should take it upon themselves to handle the rebate for you in store, instead of you dealing with the nonsense paper trail of it.

Re:rebates are a total waste of time

[martyn s]

But that's kind of the point. Most people don't bother because it's such a hassle, but they still buy the product because they believe that they will bother. They think they're getting a deal based on the assumption that they will follow through with the rebate.

Re:rebates are a total waste of time

[Lemmy Caution]

The way rebates work is that the seller gets almost all the benefits of a sale price - getting to list something as being $300! (after rebate) for only a fraction of the cost. It's simply a fact that only a fraction of the people who buy the goods will successfully apply for the rebate: multiply that fraction by the amount of the rebate, and you have the amount they actually have to lose per unit sale while getting virtually all of the competitive advantage of announcing the discount.

Re:rebates are a total waste of time

[Zenin]

For myself I've realized I'm simply not going to send rebates in. I've let $100 rebates go at times that I thought when I bought the item, "It's $100, this I'll send in for sure, I'm not that stupid...". Yes, yes I am...

I must say that my buying life has been much, much less stressful and guilt-free since I adopted the position that rebates simply don't exist. Whatever the non-rebate price is, that's my price and my choice to buy it or not will based on that, not the mythical rebate/smail spam sign up that won't ever actually happen.

Rebates suck.

Re:rebates are a total waste of time

[Dudio]

You're forgetting another key advantage to the seller - rebates generate float. Put simply, they hold your money in interest-bearing investments until the point, 6-8 weeks after the purchase, at which you receive and cash the rebate check. This is why, unlike mail/internet orders that also say to allow 6-8 weeks for delivery yet typically are delivered within 10 days, rebate checks invariably take the full 6-8 week period to actually arrive in your mailbox. Also notice how the checks are always drawn on obscure banks in places like Lake Lillian, MN; this gives them an extra day or two of interest while the check waits to be cleared after you deposit it. The Straight Dope goes into this in more detail.

Re:rebates are a total waste of time

[mcheu]

In most cases, I pretend there is no rebate to be safe. That's what people really should do. Certainly send in the rebates, of course. The companies pretty much count on you forgetting or not bothering with them. Whatever rebates you don't send for is more profit for them. Don't count on the rebate money. When you buy, just buy it based on the sticker price. When you actually get a rebate, treat it as you would if you found it on the street or won it in the lottery. It's extra cash. If you don't get it, it's not really worth losing sleep over it, but if you do. Cool.

Rebates are another scam

[realdpk]

They're buying your personal information so they can either use it to fill your mailbox with their junk or everyone's junk. There's no other reason for them not to do rebates at the POS/cash register.

Regarding computer-related rebates, they are even worse. I bought some CDR media that was "$2 after $10 rebate". I had a weak moment and figured it was worth the $10. The Best Buy receipt offered a way to file your rebate request online. I thought, great! Mailing rebate requests is sure lame!

So I go to punch in the rebate information and am presented with a page that I can print and USPS mail in.

Completely worthless, except now some additinoal "rebate processor" company also has my information.

Re:Rebates are another scam

[Chris Carollo]

There's no other reason for them not to do rebates at the POS/cash register.

Of course there is! Few people actually go through the process of filling out and sending in the rebate. So they can get customers to think of the price in terms of the rebate, but often don't actually have to "honor" the price.

Personally, I'm pretty religious about sending in my rebates and have only ever had good results. Of course, if everyone did that they'd stop offering them, so for all you folks that don't send in your rebates, thanks!

The followup article

[truesaer]

That article is from a while back. The Motley Fool just recently posted an update based on feedback from their online community:

Part II

For a company, rebates are wonderful.

[wowbagger]

For a company, rebates are wonderful:

1. They get you to buy one product over the other.
2. The probability of a person filing for a rebate is less than 1.0, therefor a rebate is less expensive to the company than an equal price cut.
3. By adding arbitrary restrictions (no P.O. Boxes for one) they can further reduce the probability of you getting a rebate.
4. They get to use your money for a while - that "float" can make them even more money.
5. They get your name and address to add to their mailing list. They can also sell that information to others, making even more money.

Curiously enough, these are much the same set of reasons that a rebate is bad for the consumer.

There is one other bad thing about rebates from a consumer's point of view: you pay sales tax on the non-discounted price of the item.

How to get a rebate on time EVERY time

[adzoox]

Include the following TYPED note in your envelope with receipt:

"Thank you for processing my rebate. I have marked my calendar to receive my rebate no later than (2 months to the day I mailed it.)" = Fill in () appropriately.

Just below this type your information from the receipt including SKU numbers, your mailing address and store of purchase plus how much you are expecting. Printing an actual two month calendar and highlighting the day of rebate is a nice touch.

I will gaurantee you will not have another "missing" rebate. They think, "looks like this guy would sue over a $5 rebate, we better get it right"

A buddy of mine goes a step further and puts:

"Consumer protection laws in my state require that rebates be processed in 8 weeks"

Connecticut's Rebate Law - Check It!

[TheMayor]

Connecticut has a Rebate Advertising law requiring retailers who advertise the net price of an item after deduction of a manufacturer's rebate to pay consumers the amount of that rebate when they buy the item. If the retailers don't wish to do this, they cannot advertise the after-rebate price as the final price to be paid by the consumer. Thus, there should be no confusion about the amount the customer must pay at the cash register.

Here is the law:

Sec. 42-110b-19. Advertising "free," "reduced," "discount," "below cost," or a rebate

It shall be an unfair or deceptive act or practice to:

(a) Advertise any merchandise or service as free by the use of the word "free" or any other terms of similar import when the merchandise or service is not, in fact, free (see (d) below). Failure to disclose any and all terms, conditions and obligations required of the consumer shall be a violation of these regulations.

(b) Advertise the price of merchandise or service as a reduced or sale price, or compare the price to a previous price unless the advertised price is lower than the actual, bona fide price for which the merchandise or service was offered to the public on a regular basis by the advertiser, for a reasonably substantial period of time prior to the advertisement or as a discount price, unless the advertised price is lower than the price being charged for the same merchandise or service by other sellers in the area; provided, however, in the case of a new product, if the advertised price is less than the price which the advertiser, in good faith, expects to charge after termination of the introductory sale, there is no violation of this subsection. The actual price after the sale shall be evidence of the advertiser's good faith expectations.

(c) Advertise the price of any merchandise as below cost, unless the price is, in fact, below the cost for which the merchandise was purchased and prepared for sale by the advertiser.

(d) Advertise merchandise or service as free or the price of merchandise or a service as a discount, reduced, or sale price if receipt of such merchandise or service is contingent upon the purchase of other merchandise or service at a price which is higher than the actual, bona fide price at which the merchandise or service was offered to the public on a regular basis by the advertiser for a reasonably substantial period of time prior to the advertisement, or at a price which is substantially higher than the price being charged for the same merchandise or service by other sellers in the area; provided, however, in the case of a new product, if the advertised price is less than the price which the advertiser, in good faith, expects to charge after termination of the introductory sale, there is no violation of this subsection. The actual price after the sale shall be evidence of the advertiser's good faith expectations.

(e) Advertise the availability of a manufacturer's rebate by displaying the net price of the advertised item in the advertisement, unless the amount of the manufacturer's rebate is provided to the consumer by the retailer at the time of purchase of the advertised item. A retailer will not be required to provide the purchaser of an advertised item with the amount of the manufacturer's rebate if the rebate advertises that a manufacturer's rebate is available without stating the net price of the item. For the purpose of this subsection, "net price" means the ultimate price paid by a consumer after he redeems the manufacturer's rebate offered for the advertised item.