Are Rebates Scandalous? 685
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.
rebates are a total waste of time (Score:5, Insightful)
Forget the Money and the Wait! (Score:3, Insightful)
Re:rebates are a total waste of time (Score:5, Insightful)
Rebates are another scam (Score:5, Insightful)
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.
Get over it. (Score:3, Insightful)
They send you a check in return for the marketing information that you provide them. If they don't send a check, complain until they do. How is this a scandal, again?
Re:rebates are a total waste of time (Score:5, Insightful)
Re:Rebates are another scam (Score:5, Insightful)
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!
For a company, rebates are wonderful. (Score:5, Insightful)
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.
Re:Beware of Microsoft Money/Taxcut rebates (Score:2, Insightful)
Enron was a tasty snack, and chewing up some companies to win some popular votes appeals to a great many politicians.
Tiger Direct (Score:2, Insightful)
Tiger Direct, fine store otherwise, is a complete scam on rebates, from my findings.
Every rebate offer wants "a copy of the reciept".
Included in the shipments from Tiger, you get a "Packing Slip".
On 5 different occasions, out of 5 tries, my rebates have come back as a postcard, "sorry, you didn't send a reciept.
I called Tiger. They said my e-mail confirmation letter was my reciept. Print that, and go.
Tried that 3 times. Included both the e-mail "reciept" and the "packing slip".
3 failures.
God, I'm a slow learner.
It's a big-assed scam. Tiger is otherwise a fine company to work with, just realize that the price you pay is the price you pay, and that rebates are a big fat lie.
Re:Get over it. (Score:1, Insightful)
Re:rebates are a total waste of time (Score:5, Insightful)
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 (Score:3, Insightful)
While there certainly is administrative record-keeping required to process rebates, it can't be much more than admini-trivia required to sell items in the first place. For a wholesaler, retail rebates of course mean a greater volume, but the process can largely be automated.
But your company manages to do the work required to sell the item in the first place, and it doesn't take you weeks to process those orders, does it? Your comapny could process rebates as quickly, if it had teh will to do so. But it's to the company's advantage to make the rebate process as inconvenient as it feasibly can., to discourage rebates and to keep earning interest on the money it eventually must rebate.
So don't tell me it's too hard: if you can sell the product in the first place, you can also do the rebate efficient. You choose not to, and so I choose not to do be taken in by rebates.
Other reason: price differentiation (Score:5, Insightful)
That reason is price differentiation. If the company charges a high price, they sell few units at a high margin; a low price means more units a lower margin. By introducing these coupon schemes, they can charge different prices for the same product. Price-sensitive customers go through the trouble of filling in the coupons, insensitive ones don't. It is the best of both worlds!
Another example of price differentiation is university tuition. There it is called "financial aid" - a scheme clearly designed to make everyone pay exactly what they can afford (note: I am not saying that there is something wrong with financial aid; I am just pointing out that it is very much in the financial interest of the universities).
Tor
At what cost?? (Score:2, Insightful)
That's rather enlightening information
It should be illegal (Score:2, Insightful)
As much of a scam rebates appear to be, at least in most cases you have a chance to develop an inkling of the crap you're getting yourself into prior to buying the product.
But here's the scam: Products that are advertised in ways that do not make the fact part of the "deal" includes a rebate. For example: products listed as purchase price minus rebate with insufficient indication of the rebate figured into the price. Even worse (and this pissed me of in a major way): I bought tax software a year ago that included "free" state income tax filing software. After I had purchased the original bundle, I learned that I actually had to spend more money to buy the state software and then wait 6 f ucking months for a rebate check to arrive.
A total fuc king scam. That should be illegal.
Re:rebates are a total waste of time (Score:2, Insightful)
Why should nobody be buying them? Do they have a shorter shelf life than other CDR's?
I might concede that they have a higher initial failure rate, but that just means you sometimes have do two burns instead of one. Unless the initial failure rate is very high, they're still cheaper than the ones whose packaging you don't have to dust.
Re:Some links (Score:5, Insightful)
It called Marketing. As the resident evil capitalist, please allow me to explain...
1. They can be used to 'not' lower the price for price matching policies. "Yea, you bought it last week but the price is still $100, we just have a rebate. We can't give you the rebate if you bought then."
2. They can be used to make people think that the factory is giving us this money, its not that we are overcharging you the rest of the time. "Its $100, before a $50 rebate, but we would lose money if we sold it for $50" Really, Im not making it up. I get paid for this stuff.
3. Sense of urgency. Its for a limited time only. This is true for all sales, but with rebates, the message, and response is stronger. "act now or miss out".
4. Convenience. Rebates are dubious at best, but with an 'instant rebate' you know you can't get ripped off. So its a better value, because there is no risk. Even though it IS the same as reducing the price, it is called "transfering the risk" to the seller, instead of to you. It works.
5. Its a different kind of sale. All sales are good. Very often, an instant rebate is used on NEW items at their introductory price. IE: This item is $150 with a $50 instant rebate. After the rebate is gone, we put it on sale for $100.
Its all marketing, thats all. The above may not make sense to some of you. Good. Thats the idea. Many of you will smugly say that the above is stupid. Thats good, too. The more 'stupid' you think these sales tricks are, the more likely you are to fall for them. I'm not making it up either, it REALLY does work that way. But that is why they (we) do instant rebates: Because it works very very well, especially for quazi impulse purchases.
Remember boys and girls, you do NOT have to be evil to be in Marketing, but it helps.
I don't understand the point (Score:2, Insightful)
Re:Some links (Score:2, Insightful)
Re:rebates are a total waste of time (Score:4, Insightful)
3. Rebate promotions always require you to cut out the UPC barcode from the original box. Many people throw the box away. Also, when you remove the barcode, it's a guarantee to the store that the merchandise WILL NOT BE RETURNED. I wonder if it lowers their insurance rates.
I'm not sure what stores you shop in, but usually the ones I shop in will take it back and refund all my money minus what I would be getting on the rebate. So once you receive your rebate, you've recouped your losses...Of course except if you don't depend on rebates, but then if you don't, you wouldn't go off tearing off UPC barcodes.
5. Who guarantees that rebates will ever be honored? A company can use rebates according to their cash flow. Lean times? Just delay (or throw-away) some rebate coupons. A quick way to make cash. If consumers complain, blame it on the postal office or some other force of nature.
Yeah, that's something to think about, but the *great* majority of the time, I get my rebates.
6. Did you notice that your rebate checks look just like ordinary printed propaganda? This is done on purpose, to increase the probability of the check being thrown away together with all the other bulk mail people receive. Moreover, those checks have a fairly short expiration date (Sometimes, one or two weeks after the date you receive the check).
...like ordinary printed propaganda...What in the world are you talking about? Rebate checks usually come in smaller than 4 1/8" x 9 1/2" (No. 10) envelopes, thick paper (and not see-through because of the "security sheet" that has a dark patterns), and perforated in 3 of the sides. As for the expiration date, 2 weeks? WTF? Yes I know the rebates take a long time to arrive, but when they do arrive, they are dated a few (4-5 days) prior and are usually valid for up to 90 days.
7. Loss. Yes, you can lose the checks after you get them. I've lost two (total = $70, ouch!).
How are rebates bad for consumers due to loss? I would say that's the customer's fault...stupid ones at that. If you loose your keys, is it too the dealership's fault?
Tax (Score:4, Insightful)
When you buy an item for $1,000 (which includes a $100 rebate), you're actually paying the tax on the $1,000, not on $900.
So, make sure you factor in the tax factor before committing to a rebate sale. Actually better yet, everyone should just boycott any and ALL items with rebates. It's all just a scam. If they wanted to give you the money they would've discounted it at the counter.
Re:rebates are a total waste of time (Score:2, Insightful)
I just can't stand rebates either, because they make me feel like I'm begging for money they owe me. If the companies really must insist on their damnable rebates, then I'd like to see some legistlation forcing standardization and penalties.
Re:rebates are NOT a total waste of time (Score:5, Insightful)
Also, how to prevent information from being sold ? You can't, but how do you deal with potential SPAM ? Each company gets their own rebate address. Also the only company that really seems to sell information is Staples.
I've gone out now 3 years now, and spent over 1500 and gotten 1200 of it back. (and I DO track my rebates).
What people are probably doing (not doing ?) is following the instructions EXACTLY so of course they get screwed.
The only products I won't buy now are Mad Dog (they keep screwing my rebates claiming a problem).
Re:rebates are a total waste of time (Score:4, Insightful)
In both cases you get $2, why is this scale factor involved? There's really no obvious logical reason to prefer one vs the other.
Re:rebates are a total waste of time (Score:1, Insightful)
I have used rebates from BEST and OFFICE MAX for years, and have never failed to receive the offered rebate.
The only drawback are the 'hidden costs' involved in the rebate scheme:
1) you pay TAXES on the full price
2) you pay for the stamp, envelope, time-to-fill-in-&-mail
3) delay on recovery of monies - which draws interest for the rebating firms
Basically, deduct approx. 10% from the rebates to cover these costs, then determine if you come out ahead with them, or without them.
(I fill them out, send them in, and generally do a seriously good deal on the items I purchase)
Re:rebates are a total waste of time (Score:2, Insightful)
Any time you're issued something that doesn't have immediate value, or requires you to take one more step to gain value from, companies gain breakage. The model for Airmiles, Malborough Bucks, and hundreds of other "point systems" rely heavily on breakage as part of their success. Something like only 20% of Skymiles issued are ever redeemed for free flights.
This is also the reason you won't see "easy online redemption" any time soon... it would drastically decrease the breakage on rebates and cost the companies a ton more money.
Re:rebates are a total waste of time (Score:3, Insightful)
Sent in both rebates with 1 receipt in 1 envelope.
Got 2 checks in 2 envelopes about 6 months later. Little late, but no hassle. I haven't even recieved any snail-spam from them either. Definately a plus for them when I look to buy more hard drives in the future [assuming it's not to replace the ones I bought that've been running well for 3 years now]
OK! OK! I confess... (Score:2, Insightful)
They even gave us a little checklist for things to look for (ie: 9's that look like 4's, copies of receipts (they wanted the originals), forms filled in pencil or red ink (on the form in fine print it said: only use black or blue ink), etc) and other little technicalities that made it so that the people who sent them in would not get their money.
It really sucked because the forms themselves were from CD spindle packs, and so they were coated with a layer of like wax or plastic or something that made it very difficult for ink to stay on. sometimes people who would write with a ball point pen would leave only the "engraved" writing on the form, because the ink would smudge onto the inside of the envelope, and so those would obviously get put into the DENIED pile.
I guess they were afraid of a class-action lawsuit or something, because forms that had the ink smudged off had to be 'destroyed' and the only record of it was a little slip that had the person's name/address from the envelope they sent it in and the reason why it was denied (illegible) that way, no one (like a lawyer) takes a second look at the forms and says "hey, look! if you angle it just right, you can see what they wrote!"
needless to say, I am now very careful not to commit the same mistakes when I submit rebates!
Re:rebates are a total waste of time (Score:5, Insightful)
Re:rebates are NOT a total waste of time (Score:4, Insightful)
No. I think he was trying to say, in return for loaning those companies $1200, he has received discounts on goods and services.
Just suppose that he spent all of his money in year 1, and he could get a rate of 4.00% a month on this money, had he kept it:
Nominal Rate of Return: 4.00%
Investment Duration (Years): 3 years
Compounding Frequency: Monthly
Compounded Rate of Return: 12.73%
$1200 * 12.73% = $152.76 opportunity cost.
He obviously thought that $152.76 + $1500-$1200 = $452.76, was worth $1500 worth of goods and services.
Re:rebates are NOT a total waste of time (Score:3, Insightful)
Either it's "In order to purchase something here, you need to give us a $200 loan for 3 months" (the exact opposite of interest-free-credit, which is what most shops use)
Or, it's "Here's a computer for $1200, and by the way, we're lying about that price" which should certainly have the retailer shut-down by trading standards. The evidence in this article certainly indicates that they have little intention of paying this money back (what's the interest rate on a borrower who defaults on 30% of loans?)
If an advert says $1200 (inc rebate), I think the correct reponse should be " you can fsck off, and I'll choose a more reputable place to buy ". Does that sound reasonable to anyone?
More requirements are making it harder. (Score:3, Insightful)