Competing with the big boxes, a retailer finds itself considering every tool in the shed to keep prices at a minimum, and that includes rebates. But consumer rebates can act as a double-edged sword. They represent an excellent opportunity to drop prices with usually only the manufacturer taking the hit. But if only a few customers experience unreasonable problems attempting to (heaven forbid!) cash in the rebate, you may find your brand the villain at various parties and Internet forums. There’s no sale worth that.
Like extended service plans, the word on the street concerning rebates can be negative at times. Consumers are often told they didn’t send the right UPC code, or that they purchased the product outside of the official dates of the rebate offer. The Federal Trade Commission urges consumers not to shop based on rebate offers, while ConsumerAffairs.com reports that one out of five attempts to redeem a rebate are unsuccessful. Because of the high-ticket nature of the industry, CE is a common source of rebates, and rebate problems. So much so that many manufacturers and retailers have phased out—or heavily overhauled—their rebate programs, such as Dell, Best Buy, OfficeMax and CompUSA.
Jerry Weiss argues that rebates themselves aren’t the problem, but rather the dishonest or unprepared clearinghouse or manufacturer offering them. The director of sales and marketing for consumer rebate provider DataMatrix said the number of those in the business who are outright dishonest are in the extreme minority. Rather, it is more likely the manufacturer offering the rebate didn’t prepare well enough, and therefore doesn’t have the funds to redeem the rebates by the date promised.