Rebates Leave, But Prices Remain

Rebates are falling out of fashion, but, as Edgar Dworsky notes,

You may naively think if stores stopped offering rebates, they will lower prices for everyone. That is not necessarily case, particularly because of the economics of rebates. Since only 40% of consumers follow through with rebates, stores and manufacturers could never afford to pass on the equivalent in savings to all buyers.

… but will anything comparable replace them? Probably not.

Basically you would need something that attracts increased purchases by promising delayed discounts, and hen uses confusing rules and regulations to prevent customers from receiving that money.

Only a mind of greatest acuity would be up to the task. — BEN POPKEN

When Rebates Disappear, Prices Don’t Fall [Consumer World Blog]
(Comic: Toothpaste For Dinner)

Comments

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  1. homerjay says:

    Good riddance. Nuff said…

  2. coopjust says:

    Rebates are up and down, it depends on the honesty of the rebate house.

    In the case of Costco and BJ’s, rebates are great, if you follow through with them. Enter the reciept online, confirm, arrives in mailbox a week later. Staples Easy Rebates, while not quite as easy, are generally easy to obtain and reliable.

    MIRs are a hit or a miss, and it really depends on the rebate house. Panasonic is a company that was deliberately slow and rejecting rebates, as well as eVGA (rejected a completed rebate). Onrebate.com is a scam- I ordered items through TigerDirect (parent company) and my rebate was rejected as invalid. Cingular was slow, but did process my two rebates. DLink is a very reliable company for rebates (1 week, no hassles) on 3 occasions).

    I did get my rebate for eVGA in the end. I just complained to the BBB with a scanned copy of all of my rebate documentation, and eVGA called and agreed to give me the rebate. So, if you don’t get your rebate, complain against the rebate company, not the rebate house.

  3. Saeculorum says:

    For everything said about rebates, I have just one thing to say:

    I have never not received a rebate that has been properly filled out, submitted, and kept track of (I missed one $2 rebate for forgetting a UPC – I didn’t pursue that one). As a customer, I know I will pay more for goods if rebates are elimited. That annoys me.

    That is all.

  4. Coder4Life says:

    Very true, look at BEST BUY, they now offer upto $150 – 250 instant off any computer. Usually $150. That is all they can afford to do, and that is because they are below their cost most of the time.

    I am sure there is a kick back from the manf. But the employees are only allowed to sell a few of those, and then they are told to not sell them or overtime it could affect their employment.

    What they need to do is move it all to E Rebates. Even the ones that are from HP or Microsoft or whatever. Those are usually the ones you have to send in. If they can do that, then they are on a roll.

    Or maybe they could say when you file a rebate you are entitled to have your informaton passed around and that way they can make profit off of advertisement and your information.

  5. Basically you would need something that attracts increased purchases by promising delayed discounts, and hen uses confusing rules and regulations to prevent customers from receiving that money.

    How about a series of progressively-harder Sudoku?

  6. HawkWolf says:

    how would you lure people in?

    I went to a Best Buy and was forcibly handed a coupon for 10% off anything.

    So, my partner and I picked out a bunch of DVDs, a PC game, and a CD.

    Guess what? The coupon good for anything wasn’t good for anything we bought.

    The guy at the register looked at it and said, “that doesn’t make any sense.” But apparently he wasn’t able to override it even though he tried.

    I still bought the stuff. We wanted to watch movies. What were we gonna do, go buy them on amazon and watch movies “in a few days” ? Plan our movie watching around a NetFlix sub we don’t have?

  7. Jesse in Japan says:

    Why not have a middle ground? If 40% of people don’t claim their rebates, then just outright lower prices by 40% of the amount of the rebate.

  8. Hirayuki says:

    Can you please provide credit for that graphic? “You may display TFD comics on any personal, educational, or non-profit website, provided you link to toothpastefordinner.com.”

    Here, I’ll do it for you.

  9. Ben Popken says:

    @Hirayuki: It was already at the bottom of the post.

  10. Hirayuki says:

    @Ben Popken: Oops–sorry about that. This is why friends don’t let friends post before coffee.

    One type of incentive you don’t hear as much about is the send-in-UPCs-get-something-free deal. I used to have pretty good results with that, but this post reminded me I have a free bra that’s something like a year late in coming. :/ Cash rebates have been good to me, though.

  11. kip says:

    Maybe it is just dumb luck, but I have never had a problem with mail in rebates.

    I’m not sure if it helps, but I usually include a little note for the rebate processor. First, I list the items that I have enclosed in the envelope just to make it clear that I have met the rebate criteria.

    Second, I issue some kind of thank you to the person processing my rebate. It is probably a pretty thankless job, and if they are going to arbitrarily reject someone’s rebate, I figure a cheerful thank you will lessen the chances that they pick me.

  12. ‘hen uses confusing rules’

    Who’d a thunk chickens were behind rebates?

  13. elljay says:

    I bought a brand new iMac from the local Apple store. It had a built in rebate for a ‘free’ printer. I passed since I don’t trust rebates.

    A day later I went back since I needed a printer anyhow. They sold me the printer at full price and gave me the recepit.

    Believe it or not! Less than two weeks later (week and a half I believe) I had the apple check in hand paying for the entire cost of the printer.

    This is my first mail in rebate. But I can say that Apple kept their word!

  14. P1h3r1e3d13 says:

    And you thought the graphic was an exaggeration:

    Once, in the Sunday newspaper-insert ads, I saw advertised a computer (budget, granted, but better than mine at the time) for a price, after rebates, of:

    $0.00

    Unfortunately, I was reading the newspaper out of town, and so was unable to pay several hundred dollars for this free computer.