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FTC Tells CompUSA to Pay Up QPS Rebates
prostoalex writes "FTC told CompUSA they will have to keep their word on paying out rebates for QPS equipment purchased at CompUSA. QPS is currently bankrupt, according to the article, although it's not clear whether they went out of business before or after the promised 6-8 weeks deadline came. CBS MarketWatch says this should spur rebate re-evaluation among other electronic retailers. The habit of offering rebate incentives seems be especially notorious in the consumer electronics and computer hardware industries as a third of shoppers for such goods bought a product with a rebate offered. Reason for such popularity? 41% of shoppers never send in their rebates."
"41% of shoppers never send in their rebates."
Of course. It's too much hassle to sign a receipt and mail it to the company and wait a few weeks, in which they'll most likely forget all about the whole thing, and get a surprize $30 in the mail. Laziness costs more than cigarettes these days.
Rebates serve 3 purposes. One is to take advantage of people who don't send them in. Another is to trick people by offering rebates that expire too soon for people to actually get them (see Tiger Direct - rebates often expire in a few days). And lastly, in a corporate environment I've heard of _people_ getting rebates for corporate purchases - this amounts to a way of bribing purchasers or other such corruption. If you want to offer a discount, just reduce the price. There's no ethically decent reason for rebates.
Retailers generally get to report earnings based on dollars brought in at the register, _then_ they pay out rebates. So even if 100% of customers send in their 50% off rebates, ACME gets to report $100,000 in widget sales, when really they only sold $50,000 in widgets.
I used to have a good sig...
I'm glad rebates of that kind doesn't exist over here. Here rebates are pretty much unheard of besides for groceries, and those are handled directly at the checkout, no mail-that-in-later stuff.
Doesn't take a genius to figure out that all that handling just makes it more expensive for the customers in the end.
Belief is the currency of delusion.
I have personally mailed in dozens of rebates in my lifetime. I have received less than half of these back. Sure, some probably got lost in the mail. But even though the USPS does suck, their success rate in delivering an envelope to its destination is still well over 90%. So what happened to the other 40% of my rebates?
Now I'm not gonna hire an attorney over a $20 rebate I never got, and they know this, so they can sit there and go "eeny meeny miny moe" and pick out every other rebate request and toss it in the trash.
They (the gov) don't even have to outlaw rebates. Just make it false advertising to put prices in ads or store displays with the rebate amount already subtracted.
The article said 41% of consumers don't send in the rebate paperwork. Well I send in close to 100% of mine, and I fail to get the checks for about 41% of them. So they will maintain their 41% non-payment rate one way or another.
Now I stop thinking about rebates before purchasing and only buy based on the full price. If one thing is plain $50 and a similar product is $60 with a $20 rebate, I'll buy the $50 one.
If I do buy something with a rebate, after buying I'll send in the papers and hope to receive the money and if I get it, it's a bonus. But I won't factor it into my purchase decision because I don't trust that I'll actually get it.
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There is inferior bacteria on the interior of your posterior.
They really have no incentive to change it. Since the rebates NEVER refund the taxes, the states get a extra windfall in taxes.
It just another conspiracy to collect more taxes.
If you paid attention at the link, 41% is how many forgot to send in rebates, amongst all those that didn't get rebates. The relevant amount you ought to have quoted (though it isn't as prominently place in the title) is, "Half of consumers never even try to get the rebates."
ProofReading Markup Language - and yes, I find typos.
i bought a 160 gig maxtor harddrive from staples that included a 35 dollar rebate, this was just after christmas (early January), i have yet to see it, i did see Staples spend a bunch on marketing these rebates in television commercials, seems to me that if staples would spend less on television advertising then they could afford to hire more manpower to handle these rebates...
Politics is Treachery, Religion is Brainwashing
You know why 41% of people don't send in rebates? Because most of the time you never get your damn money. It's not worth the $10 or whatever to fight with customer service when your money never arrives. I even signed up for a recurring rebate for a drug prescription, and they sent me all the materials and a rebate card with my name on it; shortly thereafter came a letter saying that they had no record of me and couldn't issue my rebate. Then how did they issue my personalized rebate card?! This sort of fraud seems standard practice with rebates. It's no wonder nobody sends them in. I've given up.
I had similar problems with some retailers.
From: http://www.miami.com/mld/miamiherald/8138630.htm
After being extremely diligent in filling out the paperwork and making sure that I adhered to all the requirements of the offer, my rebate was still denied by Maxtor (a digital storage manufacturer) because the paperwork ''wasn't received in time.'' If true, it would have meant that it took the postal service more than two weeks to move a letter about 20 miles from my home to the Miami rebate center. It was only after contacting the Better Business Bureau that was I able to get my request honored.
After doing an informal poll of some of my co-workers and associates, many of whom work with information technology, I was surprised to learn that almost all of them had had rebate requests denied. Unfortunately, many didn't send their requests via certified mail because the rebate amounts, often $5 to $25, didn't seem to warrant it.
After my experiences, I would suggest a few steps:
Read the rebate requests thoroughly. Many times, they require the actual register receipt and not a copy. Some will require that the rebate item is circled on the receipt even if it's the only item listed.
Keep physical and digital copies of your paperwork and receipts, including the envelope used to send the forms. This makes it easier to forward copies to the state consumer affairs department, Attorney General and the Better Business Bureau.
Submit the paperwork immediately. Retailers count on customers to lose receipts or forget to request the rebate.
Use certified mail to prevent the convenient excuse of ''late mail.''
If you're denied your rebate after complying with the offer, make sure to send your information to your state Attorney General's office. It can't take up your case directly, but it can help establish a pattern of activity.
1) Mailing the claim can cost as much as $10 with reception confirmation and other such options... make that $2 for plain enveloppe and international postal charges.
2) Cashing the refund can cost over $5 for people without USA-funds banking accounts.
3) Most rebates I have seen have a disclaimer that says they will be honoured at the manufacturer's sole discretion.
Because of this, I only buy into rebates when the base price suits me - FutureShop having a $110 CDN Audigy2 sale plus $45 mail-in is nice when the next lowest regular price around is $115 - this is how I discovered that USA rebates cost about $10 to claim... so that $45 rebate barely covered taxes, postage and cash-in costs so the card cost me about $110 net.
All in all, rebates are annoying and doubly so when they are in some other funds, not worth bothering with if under $20 - I prefer waiting a little longer until the "rebate" price becomes the regular price since rebates usually mean pending price adjustments and new models.
WTF, CompuUSA is the seller, the mfg is responsible for the rebates!
CompUSA was advertising the rebates, as in "$XXX after rebate" pricing. They continued to do that even after they became aware that customers were not receiving the rebates and that the company offering them (QPS) was in bankruptcy. It's not like people went to CompUSA and plopped down $100 for a DVD-R drive only to be surprised to discover a $45 rebate in the box. These people were, by and large, enticed by CompUSA's advertisement, which promised a rebate.
I read the directions and send them in religiously. Got a card back from Belkin saying I hadn't sent in 'some required information'. Not enough info on the card to tell me what information, or what rebate, or when. So what the hell do I do? Stop buying Belkin is about all I can do.
What I did in a similar situation was phone and ask what information was missing. The person said that she could not tell me. I told her that I wanted them to return everything that I sent. She smugly informed me that the rebate says that they can keep everything I send. No, I told her, it does not. It says that they may keep it if they pay the rebate. Since they were not paying the rebate, I wanted it back. Suddenly a supervisor got on the line and said that he was approving payment. I had the check in under a week.
If we must have rebates, I have to admit that Staples is the way they should go. You get instant online verification of your rebate, no waiting 6 weeks to get a postcard that states you supplied incorrect information.
The rebates at Stapes are handled online very quickly and you have a tracking number to follow. Everything is upfront and out in the open.
I had one item that was disallowed this past Christmas and since it was online and there was recourse (email), the problem was cleared up within days. I had records on my computer and everything worked. Very nice.
About 6 years ago I did a stint as a low level manager at a CompUSA in the northwest while I was between jobs. Rebates were a constant thorn in my side. Every weekend a flyer hit the paper offering about 10 different items that were "free after rebate." People would line up out front waiting for the doors to open. Then they would rush in and grab up all of our stock of that item. Then the fun began. Those people who came in after the rush would get belligerent that we didn't have any more and start big scenes in the store. Or, we wouldn't have enough rebate forms for everyone. I was also always dealing with customers that never got their rebate, or got a card telling them that they didn't handle the process correctly and were not going to receive their money. What most seem to not understand is that 99% of the rebates that were offered were given buy the manufacturer, not CompUSA. Our sales agreements forced us to offer these rebates, then we were forced to deal with inventory and coupon shortages caused by the vendor, and the customers that never got their check. VERY, VERY, rarely did CompUSA offer their own rebate. But since we were the retailer those with problems came to use for resolution. I felt bad for them that I was not able to help. Corporate policy forbade us from giving them anything as compensation (the thought was that WE did not own them, the vendor did, so why does it have to come off our bottom line). My thought is that we possibly made money off the transaction, so we should do something. But in the end it was a lose-lose situation.
My
"What you mean is that fraudulantly offering an unredeemable rebate should be illegal, which it already is."
Here's my beef.
Rebates in some theoretical sense are fine.
There's two things I have a problem with, one of them is philosophical, one of them is practical. Lets start with the practical.
I have in several cases, sent in rebates. I'm usually very careful. I have in several cases (a) not received a response ever or (b) The rebate fulfillment house claims I didn't send in enough paperwork (and well past the deadline for submission.
I have no recourse in these situations. I'm just out the money. And what's worse, nobody has an incentive to make this right, because the company is simply out money if its correct, and they get more money if I'm screwed.
On a more philosophical level, I have a beef with rebates. Lets go through this:
Merchant: Buy this widget for $2, and I'll give you $1 back in the mail.
Me: Why not just sell it to me for $1?
Merchant: Because I'm hoping you'll forget to send it in, and I won't have to pay you that $1.
You see? Its almost fraud but not quite. So from that viewpoint, I understand why people think it should be illegal to offer rebates.
But even if you disagree with my philosophical conclusion, how do you deal with the practical aspect of a system that has no ability to be corrected? Its like playing the lotto as to whether that rebate actually comes.
You were mistaken. Which is odd, since memory shouldn't be a problem for you
I used to buy supplies (monitors, printers) on company expense and make a copy of the receipt before turning it into accounting. Then mail in the rebate myself and have it sent to my home. Cha-ching.
try { do() || do_not(); } catch (JediException err) { yoda(err); }
41% of shoppers never send in their rebates.
...
If your read the very poorly written article, it appears that 41 % of those who missed out on the rebates just forgot to redeem them. There is no figure about how many people actually send the rebates, and no figure about how many of them did receive their payment.
Beside, the quoted article seem to be based on another article, whose link is broken
More info about the study behing those figures can be found here.
I disagree with several of the posters here who say that rebates ought to be illegal and offer no value other than to return products to market value.
If the rebate is not paid, then that is fraud, otherwise:
Rebates are the equivalent of a flexible pricing plan that allow those people that care enough about the $20 to go through the hassle of completing the transaction. At this point most consumers are fully aware of the annoyance level and factor that in to their buying decision.
Poor/Parsimonious people who really need the product will follow through, get the discount and purchase the product. The rest will do so at some much lower hit rate (well below 50%).
This means that the price people pay varies based on need.
The result is that more people are able to buy the product so it can be manufactured and sold in higher volume (and therefore possibly at lower cost).
Regarding the cost benefit of rebates, I can state definitively that the best rebate deals at Fry's are usually selling products below cost of manufacture (eg 250G HDDs for $99, network hubs for $0). Sure, some products use rebates to return prices to the discounted price of their competitors but smart consumers can do the math, realize that, and decide if its worth the hassle.
Even without rebates, the airline industries pricing model, convenience-store pricing, and apparel industry off-season discounts are all examples of flexible pricing to capture different consumers at different times with exactly the same product.
As a lazy consumer, I wish everything were flat priced so I would never have to worry about whether I'm getting "screwed" by paying more than the best (or even average) price.
Legislating flat-pricing would be nice, but I believe it would end up producing higher-priced products overall.
When Costco has rebates, they print a URL on your charge slip plus a rebate code. Go home, type in the rebate code, and it tells you right then and there whether or not the rebate info is good. Takes a couple weeks to get the check after that. You can check status on multiple rebates you might have.
I can honestly say that in my 25 years as an active consumer, I have had less than 10 rebates give me any problems. It does require about 10 mins to carefully read the instructions and fill out the form, but as long as you have the ability to pay attention to detail, you shouldn't have a problem.
On the rebates that I have had issues with, normally a simple call to their customer service line will get results. Especially if you start the conversation by stating that you have no problems informing your local Attorney General of their failure to comply with their rebate offers.
My worst experience was with Office Depot which has a notoriously bad rep for not fulfilling rebates. To get my rebate from them last year, I finally took a handful of paperwork from my small claims court to the store where I bought the product and the Store Manager seemed happy to cash out the amount of my rebate to me on the spot.
Rebates are okay by me. I don't care where you look online, you can't find a 160GB hard drive for 30 bucks straight out. Nor can you find a Dlink 802.11G Router and PCM Card bundle for 20 bucks. Both of these deals I got within the past 6 months with rebate offers.
http://jayceecorder.blogspot.com
Personally I find 'mail in rebates' just a way to advertise a lower price than they are really selling an item for and get away with it - They put *29.95* up there in large font but then in small print below it include (after $50 mail in rebate).
If they put 29.95 as the price in large print, I should be able to walk in the store with 29.95 (plus tax, etc), and be able to walk out with the item. Its just a scam that I have to *loan* them an additional $50 interest free that I then have to jump though hoops to *maybe* get back - and yes I'm sure they count on lots of people to not even bother.
For that I would never consider rebates (except in-store ones) when comparison shopping. I go by the amount they expect me to pay at the register.
Despite all your mumbo-jumbo
Obviously you don't work in retail, distribution, manufacturing, or the IT support of those areas. It's not mumbo-jumbo, it's how it's actually done. Sorry if that doesn't help prop your take on this.
This doesn't even make sense
Sure it does. If the rebate is from the retailer then you apply pressure on the retailer. If the rebate is from the manufacturer, you apply pressure there. If the manufacturer is miserable about it, you can see if the retailer (as one of their dealer) is willing to help out, or you also apply pressure there.
Places like CompUSA have thousands of suppliers. Many of them (the suppliers) encourage sales through rebates. Most of those having nothing to do with CompUSA directly, and the cash flow that you mention doesn't change for CompUSA one way or the other (unless it's their own in-house campaign, or they've been recruited to get involved in the redemption process in some way).
Why is it inherently bad for the consumer? If every retailer (of the same size/buying-power) that sells Seagate drives pays Seagate essentially the same price for the products, then the price you pay at the register is determined only by how low a margin the retailer can stand while trying to remain competitive. If the manufacturer sweetens the deal (for YOU, not CompUSA) by throwing a rebate into the picture, that many stimulate sales for CompUSA, but it doesn't change what they have to pay Seagate for the products.
Don't disappoint your bird dog. Go to the range.
Officemax is a serial rebate abuser. They put all their rebate coupons in a little book with very small writing.
What you're unlikely to notice, are the absurd submission post mark dates. Often less than one a week after purchase. That's hardly time to even test the newly purchased equipment. To return a defective item, the packaging must be intact which precludes submitting the rebate paperwork on time. So they take advantage of the customers inattentiveness/work load to scam them out of their rebates.
Note: They'll often advertise the same item (with similar rebate) every month or so.
If everyone sent in their rebates, there would be no more rebates. Companies can offer insanely low proces with the rebate because they can bank on the 41% that don't return it, thus they make a profit. If everyone ent in the rebate they would make no profi, hence the rebate would go away. We should APPLAUD those 41% for allowing the rest of us compulsive people to get good bargains.
First of all, I have a problem with banning anything - I think consumers should be able to evaluate if they like rebates or not, and purchase accordingly. I happen to like rebates.
If you are willing to take the time to fill them out and follow up when necessary, rebates can be good. I've gotten over $8,000 in MIR since I started keeping track (the excel spreadsheet is here.
Rebates can be good in a couple ways. First of all, if you stack a rebate with a coupon with a minimum spending limit - ie a $20 off $100 coupon - you get to use the coupon and send for the rebate. Secondly, stores also offer FAR (free after rebate) stuff, and they aren't just going to hand you free stuff - but they will after rebates. Thirdly, sometimes through loopholes you can make out - I recently got paid $45 by Microsoft for buying OneNote - it was $55 from Amazon with a $100 rebate from Microsoft.
Also, if you are having trouble with a rebate, the rebate tracking forum on Fatwallet is a great resource - you can learn which companies are good and bad about paying in a timely manner, and there is a sticky thread with contact info for most major rebate processors.
I have blog like everyone else
The USPS does a pretty good job of delivering conforming mail to the high-volume incoming mail operations I work in, mostly remittance processors. Credit card and other bill issuers don't include an envelope just to be nice (just look how evil they can be in other aspects of their business), they include a return envelope to streamline processing. A good return envelope will be decently constructed, of a standard size, and include either a preprinted postnet bar code on the envelope, or on the part of the statement which shows through the window. The window itself is a feature which facilitates efficient handling once it reaches the incoming mail area, ensuring that the statement and enclosed checks, money orders, etc. are in a predictable position in the envelope. This facilitates processing by automated machinery such as this and eases manual processing on machines such as this.
Contrast this environment with my recent experience sending in 3 seperate rebates in order to reduce the cost of my Tax Cut program with the included E-filing fees from about $80 to $35 or so. I had to search over the whole pile of advertisements and coupons to find the necessary coupons, cut 2 coupons out of a booklet, and cut the UPC from the cardboard boxes which the programs were enclosed in. I also had to provide 3 of my own envelopes to send them in, each addressed to seperate P.O. boxes, all to the same Zip Code in El Paso TX.
Using my knowledge of remittance centers in general, my picture of this particular mailroom isn't very pretty. Receiving millions of rebate requests per month, from hundreds of constantly changing PO boxes, the incoming mail arrives as a jumble of random types of envelopes. The contents in these envelopes is a random combination of being taped, folded, stapled, and paperclipped together, and in random order in the envelopes. All of this work is processed by a small army of poorly paid processing clerks. Based on the location (El Paso, TX) many of these clerks probably have only a tenuous hold on the English language.
Under the current system, there is no hope of being able to process this work automatically, or even efficiently process it on semi-automated workstations. Errors will abound, lost and misrouted mail will be common, and stacked up all over the place. Rebate coupons expire in the waiting trays as indifferent and poorly trained clerks fumble to try to keep this mess under control. There is no urgency to process this work, as the company has no incentive to process it quickly or accurately, like bill payments are.
If the rebate processing business was like the payment processing centers of major banks, credit card agencies, etc. then the customer would merely have to include a coupon or two into the provided envelope. The work could be processed by automated equipment, imaged inline, then payments could be sent with 99.9 percent accuracy, and the customer would receive their check less than two weeks after they mailed it. On a per-transaction basis, it is much cheaper to have a process designed around automated processing than to do it the way they are probably doing it now. Either the processing center managers are ignorant of modern processing techniques, or they benefit by the current chaos within their walls.
How to get your rebates:
Here are my opinions about how to get your rebates and how to think about rebates in general. We've applied for several thousands of dollars of rebates, and gotten almost all of them, usually after a lot of work. I'm not saying you should get involved with the rebate game, but you may get a good laugh from reading about it. Getting rebates got to be a hobby with us. Like a lot of people, we carried our hobby to extremes. My wife just read this and said, "Oh, it's not a hobby, it's painful when I need to call", but she feels very different when she is in a store that has ridiculously low prices after rebates.
Use the F word: Just say "Fraud". There are only a few rebate fulfillment companies. Once you are on the list as someone who uses the fraud word, they don't try to steal from you.
Always be friendly. Always be businesslike. Call the rebate company. Politely ask the name of the person who answers. Write that down. Mention that offering a rebate and not sending it may be fraud. The employee will usually give some scripted lie, like saying they didn't receive the rebate request. Just politely continue asking for your rebate, and mention that, in legal cases involving fraud, it usually won't be the top managers that go to jail. Mention that anyone who has knowledge of the fraud may be prosecuted.
The rebate staff person does not want to risk legal trouble for a minimum-wage job. They are authorized to give you your rebate in extreme cases. Be an extreme case.
The rebate company does not want to lose a staff person, because it costs money to hire and train them. That is what is likely to happen if the staff person is afraid of legal problems. The manager of the rebate company will tell the staff that there is no chance they will be prosecuted for fraud, which will only make the staff more scared. In this particular case, this particular F word is very powerful.
More tips:
Beware of worthless items: Be aware that many computer items that are sold with rebates are actually worthless. They have been found to be so defective that they could not be sold normally. So, they are advertised as free after rebates, or for a very low cost after rebates. (Usually they use more than one rebate to make it less likely you will do the work.)
We bought three Netgear FVS318 router/firewalls from Fry's. They were advertised with a rebate. After many lost hours we found: 1) The remote administration of the FVS318 requires sending the password in the clear, so there is little remote security. 2) The Log Out menu choice sometimes does not log out. Sometimes the FVS318 becomes confused, and cannot establish a VPN. 3) There were other bugs, more than can be recounted here. 4) Netgear first-level technical support is (at least partly) in Tamil Nadu, India. They are friendly and will happily talk for hours. However, Netgear does not appear to have given the Tamil employees much training. So, in my opinion it is arguable that no one should buy the FVS318. Maybe that's why the rebate offer.
Fry's and Netgear played another trick with the FVS318 rebate offer. They wrote a very long rebate form, with the name and the address at the top, as usual, but asked for the name and the address again at the bottom. If you didn't see the second request for name and address, or thought it was a mistake, they denied the rebate request. We didn't enter the information at the bottom. Our rebates were denied. A friendly Fry's mid-level manager told us she would take care of it, and, after two or three calls to her, she got Netgear to give us our rebates. Elapsed time: 5 1/2 months.
On the other hand, there are good deals: We bought four CD recorder drives for $5 each after rebate that work very well and came with a non-restricted copy of Roxio Easy CD Creator 6.
Shop on the day after Thanksgiving: The best time for rebates is the day after Thanksgiving. That's when people begi
Here's an article on how to get every rebate you send in for.
Neutiquam erro
Rebates serve a real purpose that benefits the consumers. Rebates allow manufacturers to sell the same product at two different prices, with the customer self selecting which price group they belong to.
Generally, those who are more affluent ends up not sending in the rebates since the time it takes them to fill in the rebate forms is worth more than the amount to be recieved. Those to whom the rebate amount is more valuable will tend to send in the rebate. However, the rebate system as it is implemented today has some real problems. They take too long to process and are too unreliable. But the idea of rebates is not an evil one.
Regards,
Spock_NPA
Maybe they should get David Spade to do rebate fulfillment.
"We can't solve problems by using the same kind of thinking we used when we created them." -- Albert Einstein
Maybe they should get David Spade to do rebate fulfillment.
(I replied to the wrong parent before. -- I'm lame.)
"We can't solve problems by using the same kind of thinking we used when we created them." -- Albert Einstein
Some banks won't honor checks over six months old, and a few amount won't honor checks with a different expiration date...but many will, and you just need to slip it into the system once. Once it get into the computer, it won't be stopped, computers have no idea of expiration dates.
And if they accept it, they can't take it back out, even if they realize it later. It's not 'fraudulent', it's just that they failed to follow their own policy in what checks they would accept.
So first go to your bank and try to deposit it. (Not cash, just deposit, they pay a lot less attention to those checks, because if it's bad they can suck the money back out. Also note your bank has no incentive to care.) Then try their bank.
If all that fails, or you no longer have the check, you have the legal right to contact the issuer and demand they honor their debt. The check expiration was not part of the rebate rules...they still owe you that money.
Check expirations are mainly a scam. Don't fall for it. A check is not a contract, and just printing something one is explictly not legally binding under the UCC. Even if the check won't be honored by a bank, the money is still owed to you, and you can demand another check.
If corporations are people, aren't stockholders guilty of slavery?