Buy.com And Webloyalty Reservation Rewards – Say It Isn't So!

CNET has a great article today about sneak attack merchants Webloyalty/Webvertrue/Reservation Rewards. It focuses on the relationship between Buy.com and the company that is suspect enough that the federal government is now interested.

Reservation Rewards, as you may recall, pays otherwise respected Web merchants like Buy.com, Orbitz, and Fandango for the right to market to their customers after transactions are completed. Customers enter their e-mail addresses, don’t read the fine print, and are billed for a coupon service they weren’t particularly interested in. After a colleague fell for the scam, CNET’s Greg Sandoval talked to Buy.com to see exactly why they’ve hooked up with this shady merchant.

An Orbitz representative declined to comment. Representatives for Buy.com and Fandango say they are doing their customers a favor.

“We have a longstanding relationship with WebLoyalty because we think they provide value to our customers,” said Jeff Wisot, vice president of marketing at Buy.com. “They are a company that has millions of customers who are happy with them and they provide valuable discounts and other services to their customers.”

What he didn’t say is that WebLoyalty pays Buy.com and other retailers for the right to market to their customers. Adam Sarner, a marketing analyst for research firm Gartner, said he is skeptical that these kinds of relationships between marketers and retailers are good for consumers.

“If you demonstrate value and a benefit for both sides,” Sarner said, “customers shouldn’t be complaining about being tricked into accepting your offer. Obviously, companies that bury terms in fine print or get (credit card information from someone other than the customer) already know consumers don’t want their products.”

Exactly! Be sure to check out the annotated version of a WebLoyalty popup provided by the company, where they label all of the pieces of the ad and very carefully explain how it’s not a scam.

But if a product provides real value, you can sell it without sneaking into people’s wallets.

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Buy.com, Orbitz linked to controversial marketers [CNET]