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Computer Rebates Not As Sinister As You Think
Lam1969 writes "Robert Mitchell dug up some details about rebates after getting up at 5 a.m. to get a free (with rebates) computer bundle at Circuit City. He had to deal with five separate mail-in rebates to get his money back, and decided to ask an expert about whether rebate come-ons are some sort of attempt to trick consumers. The reply: 'The big lie that the media and attorneys general want you to believe is that all the retailers and manufacturers are crooked and the reason [they] do rebates is breakage, which is people not turning them in.' Furthermore, Mitchell reports that retailers are making the process easier, by printing rebate forms and receipt copies at the register, and letting people track rebates online. His conclusion: The trade-off of having to do a few hours of copying and envelope-stuffing is worth the price of a new computer, so stop whining -- 'suck it up and accept your rebate check like a man.'"
Why don't they take it one step further and file it for us as well? Then we can just take the rebate off at the register? I don't mind paying sales tax on the full price.
Agile Artisans
If they really wanted to make it easier for consumers, why wouldn't they just discount the price by that much to begin with?
If the manufacturers REALLY wanted us ALL to send in the rebate forms, and were NOT expecting this 'breakage'... then why? Tell us WHY you have this convoluted rebate system in place, rather than offering us a lower price WITHOUT the rebate system?
:)
The ONLY reason I can think of is that they want to collect the interest on my $40 cheque between the time I've bought the product, and cashed the rebate check. Surely they could not be earning enough interest on that to warrant the expense of maintaining the rebate system.
The only OTHER reason I can think of is so the manufacturer can advertise the 'after rebate' price, but exclude bunches of people from being able to obtain that price (ie, multiple orders, businesses, etc).
Well, okay, I think I just answered my own question
Check out http://www.rebate-tracker.com/ if you want to have a central point of management for all your rebates.
Something the article seems to miss is that many rebate processing houses like to invalidate rebates for no reason whatsoever. They often claim that you didn't include all of the materials, or that they weren't mailed in time. I've had this happen to me several times. Thankfully I've kept copies of everything, which I was able to fax to them to "prove" that I did send everything that was required. If rebate houses behaved a little more honestly, they wouldn't have such a bad reputation.
Be a real patriot: Question authority. Think for yourself. Formulate your own conclusions.
Putting aside the obvious question (who the fuck is The NPD Group? Why, a marketing consultancy!), the guy who talked to the ComputerWorld reporter is full of shit at best ad bald-faced lying at worst.
I should know - I used to manage a service with rebates. (Hence the anon post.) The rebates were only cost effective because of breakage. In fact, we once had to reduce the rebate amount for a particular group of users who had too good a take rate (business users who would send in rebates en masse, for an IT product.) The only way we could tell customers they saved $XXX was because we knew some of them wouldn't turn it in.
If this so-called reporter had asked even one or two sources inside a company that uses rebates, instead of talking to a consultant who probably recommends them for a hefty fee, he would have figured this out.
The guy might have had a point if he actually waited to see if the checks showed up before he came to his conclusions.
What about rebates as a way to get around privacy laws by making you fork over all your personal data in exchange for the rebate? For me, this one of the things I disliked the most about rebates - I shouldn't have to pay an extra premium on my purchases because I refuse to give out my contact information the company.
As much as I dislike some of the 'underhanded' sales tactics of Best Buy, the rebates they offer are usually well worth having to buy something there.
As long as I know exactly what I want when I walk in there I usually end up with a nice deal.
Quite a few people complain about Best Buy not honoring rebates for a myriad of reasons but again, I follow the instructions on the rebate form they give me at the time of purchase, send them in and usually have a rebate check within 3 weeks.
Ka - Ching
Do what thou wilt shall be the whole of the Law - Aleister Crowley
Actually, I'm still waiting on three of my four rebates from CompUSA on a router I purchased. The first check arrived two or three months ago (the rebates went into the mail four months ago). I'm not saying that I won't get them, but let's just say I'm entertaining that possibility. Worse, I can't return the router without the reciept. Since the router was giving me no end to the troubles, that was also rather vexing.
When you get right down to it, FOUR rebates to mail in is ridiculous. The all went to the same building, as I recall, just to different PO boxes. There's no reason for that as far as I can see. Even if there is, I propose that the retailers ought to tell you when you'll be having to send in more than one rebate form (and how many, in that case).
I used to work at staples and we purposely put products out with expired rebates or a rebate that expired in mere days before consumers could file them in.
..gulp.. worst buy even though they treat their employees like dirt and seem to be the walmart of the tech industry.
Also I bought a video card that was defective at compusa and it was teh last one in stock. The same exact card was available at circuit city for $60 more. Even with the rebates teh price would only equal the exact one at compusa.
So in other words you are getting no value at all depending on the product with the rebates. This is also assuming that the rebates are not expired. So yes whinning should be appropriate and I believe Circuit City does this to make consumers think they are getting a better deal when they see "BIG SAVINGS" on the price tags of the shelves.
This made me a customer who no longer shops at circuit city as a result. I supposed I could shop at
http://saveie6.com/
Are there other countries doing this? I must admit I haven't been everywhere, but I've been to a quite a few countries, and usually when something is advertised at a price, that's the price it is. You don't have to "earn" your discount by performing some sort of (irritating) action after the purchase.
So is this done anywhere outside of the US? If I suggested this idea to my friends and neighbours they'd probably look at my like I was crazy.
I mean, let's think about the process. The consumer fills in a form, and mails it to the company. The company then has to fill in another form (known as a cheque, or since it is the US I suppose we'd better call it a check), and post it back to the consumer. The consumer then takes the check and posts it to their bank. Their bank then processes, creates additional paperwork and posts it to the company's bank to verify the signature. Presumably at that point the money transfer is done electronically.
Is there something wrong with this? Are not a lot of resources being consumed unnecessarily? Why do they persist with this stupidity? Why don't governments simply pass laws to encourage retailers and manufacturers to deal in a more straightforward way with consumers?
Or am I missing something here?
Naturally, I wasn't going to slack when it came to filling out a $200 rebate. Within a couple days of getting the phone I took an hour off to fill out the rebate form. Only one problem. The box they sent me didn't have the required UPC code. But whatever, I'm sure I could call them to straighten that out.
So I filled out the rest of the sheet and had almost everything together, and then I noticed: You had to wait six months before sending in your rebate. And at the six month period, you had to include your most recent cellphone bill.
What absolute stupidity. I mean, why couldn't they accept the rebate right away and say that you won't get paid for six months, when they do a check to make sure your cellphone account is in good standing? And it gets better. At the end of that six month period, you only have a thirty day window to get your rebate in!
How many consumers are this organized to send in a rebate not earlier than six months after purchase, and not later than seven months? Well, lucky for me, I am. I've made a note on iCal. I've also made a mental note: never purchase anything from Buy.com again.
I'm generally "Interesting," "Insightful," and even "Funny" here. What the hell happens to me at parties?
I know that we've also been moving toward an online system where rebates can be redeemed directly from our website, so that the customer doesn't even need to send anything in (took long enough though). From what I can tell, it is a pain sending them in but you almost ALWAYS get your check back in the mail. People love telling people about how they got jipped because they charged them money that they promised back and it never got returned to them. This is why you always here these stories about rebates never coming back. However, people don't usually say, "Hey I got my rebate check, it was really fast and everything."
From my experience rebates are made for the customers, and the sellers. It gets people into the store, they save money they'd normally have to spend, and usually the store picks up the lost money on items added on (ie. Extended Warranty, mice, keyboards, cables, mouse pads, webcams, the list goes on and on). But this move to an online system makes me think that the mail-in will soon be on the way out.
$0.02
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I buy alot of rebate items at Frys Electronics and I have found over the years that...
1) The cashier will give you the wrong rebate form. This was notorious when they had 8 rebates for Seagate drives. The cashier would grab the first one they found. Result. Rebate refused. Note: Fry's now prints the rebates with your receipt, so this happens less.
2) The rebate will require that you include some part of the package that doesn't exist. This is true with memory modules. Read the fine print, and it says to clip the logo and the UPC. Trouble is they gave you a package without the logo or missing the UPC (memory comes from the cage, and may not have a UPC).
3) They refuse your rebate, saying it was late. Now I got copies of everything, including the envelope. How can I prove when I mailed it? Stand in line at the PO and send it registered mail? WTF?
4) The form says to include the original receipt. The cashier says it is OK to send the Rebate Receipt. Wrong.. Rebate receipt is not acceptable, must include the original! Refused.
All of the above have happened, more than once. Worst are the memory rebates. They lie like dogs. They trick you. Anything but play fair.
I agree. I avoid the rebates whenever I can.
"If you want to give me a lower price, give me a lower price."
Exactly. Is it SO revolutionary of a concept TO JUST GIVE US THE LOWER PRICE???
Rebates only exist as a way to jack up the price and make money off the 70% of people who won't correctly send in the rebate.
For example, let's say an item should cost $49.99.
Best Buy will come up with a brilliant idea. Sell it for $69.99, but offer a rebate that supposedly makes the effective price of the item say $19.99.
BB advertises the price to be $19.99, but with tiny lettering about rebates. Now idiot consumer goes into the store, lured in by the ad, buys the item for $69.99, and forgets to mail in the rebate.
What's the problem here? THE ORIGINAL PRICE OF THE ITEM WAS $49.99. Best Buy not only got people to come in and make purchases with the alluring ad, they were able to use the rebate system as a way to JACK UP the original price of the item.
It's scam written all over it.
If you want to people to come in and ACTUALLY take a loss on a item, then just slash the price for that item to get people in the store. Some of these places do it on Black Friday, but why not for other days?
In Wal*Mart's with a grocery department, Wal*Mart takes a loss on its entire grocery dept (yes, the ENTIRE dept operates at a loss) to get people in the store to buy the stuff they have 300% mark-ups (From their paid price) on. Best Buy can do the same thing, without trying to be greedy in a SCAM sort of way.
"I had read that retailers like to sell prepaid gift cards, and that they're highly profitable because consumers lose them or let them expire."
Even in California, where it is illegal for a gift card/certificate to expire, these cards are good money makers and in some way take advantage of the customers.
Jack In The Box sees so much revenue potential in the card that they are giving customers 2 free tacos for getting a gift card with $10 or more.
Mickey D's is giving free $1 gift cards with certain purchases, to show off their new gift card system.
Although gift cards are not as bad as rebates, retailers honestly don't have them for our benefit. They have them because market research shows some certain amount of money is never used, meaning easy profit for the store.
Even if more gift cards were redeemed, if you've ever had a business class, you know everything revolves around cash flow, and gift cards are the epitome of cash flow.
You're not screwing the government, you're screwing the millions of people that depend on government money to survive. Stop scamming the government, millions of people on welfare depend on taxpayers.
The interviewer from TFA interviewed someone from "The NPD Group" which (from http://www.npd.com/about.profile.html ) "provides global consumer and retail information that helps manufacturers and retailers make more informed, fact-based decisions in order to optimize their businesses". Maybe it's me, but that sounds like a retail industry mouthpiece to me.
"The big lie that the media and attorneys"
You just know he wanted to say
"The big lie that the LIBERAL media and TRIAL attorneys..." I'm a
Rebates are the tool of the devil. The put them out full well knowing that something like only 40% of rebates are returned. If they actully gave a shit about their customers they would give the break at the register and not put us through this dance.
Oh and interesting how one of the two times I've done rebates in that past Bestbuy screwed me saying I hadn't included something. I can't tell you how many times I've heard of people having the same thing happen to them. I avoid them at all costs.
IMHO they should be 100% illegal. Give us the price at the register or don't advertise it. Or how about this? Say its $100 with a $50 rebate. I'll pay $25 and promise to send you that extra $25 within 4 to 8 weeks.
If you wanna get rich, you know that payback is a bitch
do they cunningly assume you'll file the rebate and refrain from paying that portion of the tax
Impressively cynical, although devoid of understanding of the use tax. Read the fine print on any coupon; "purchaser is responsible for all taxes". If groceries are taxed in your area, check the next time you buy a box of pop tarts with a coupon from the sunday paper. You pay tax on the original amount, not the coupon discounted amount, and yes the store has to pass it on. Same goes for rebates even if it's you who has to send in the coupon to the manufacturer and not the store Think of rebates as just coupons that the consumer, instead of the vendor, remits to the manufacturer.
If you make a purchase where you have to deal with five separate vendors for rebates (as did the person in the article), aside from potentially not getting your refund, you now have FIVE MORE commercial vendors with your name, phone number, and address.
For me peronally, I don't care how much the rebate is...it's just not worth it to prostitute myself like that.
I'm surprised noone's mentioned differential pricing yet.
Companies want to make as much money as possible. (duh)
Lets say person A is willing to buy a particular hard drive for $20.
Person B is willing to spend $25.
If you set the price at $20, you don't make as much money as you could.
If you set the price at $25, you lose a customer.
Ideally, you get each person to pay the most that they're willing to pay.
Rebates help accomplish this. A person who makes a high salary will be willing to pay more for an item, and they'll value their time more. They won't send in the rebate.
A person who values their time less and makes less money will take the time to fill in the rebate.
To put it another way;
When I lived in China, you had to haggle over the price of most goods. If you sat there and haggled for half an hour, you could get the price down. A person who made more money wouldn't see the value in haggling for half an hour for a few quarters of a price reduction, and would pay a higher price just to get the sale done. Rebates accomplish the same thing, without requiring any inefficiency on the part of the seller.
I'm sure there are other reasons as well, but this would seem to be one use for a (deliberately inconvenient) rebate.
___
It's the end of my comment as I know it and I feel fine.
I think there are companies that essentially assume the debt of rebate and then make money on not paying them.
What I mean is, if you are "SuperComputerManufacturer" and offer a rebate of $10 on 1 million items, you now have a liability of $10M dollars.
I think that companies will then bid on the debt to pay the rebate. In otherwords, they'll bid an asking price of $9M. Therefore the manfacturer gets out of $10M of debt for $9M, and the rebate company makes $???? money by assuing they'll only get x% of the rebates properly cashed. So every rebate they deny is essentially their money.
It really makes perfect sense (although this is pure supposition).
And if this turns out to be viable business model, I own the patent.
You were mistaken. Which is odd, since memory shouldn't be a problem for you
Pot, meet kettle.
http://www.ct.gov/drs/cwp/view.asp?a=1477&q=26992
That's for Connecticut, I recently looked up the same for Texas with the same results. From my experience, having lived in 9 other states from one end of the country to the other, that's pretty much the way it works everywhere.
When information is power, privacy is freedom.